<i>OpenDoor is unique in that it owns all the homes it lists for sale, countering the prevailing trend in Silicon Valley of solely running a marketplace that matches buyers and sellers. As a result, OpenDoor’s strategy is steeped with risk, potentially backfiring if the economy tailspins...The company uses mostly debt financing to buy homes, improving returns. Mr. Wu declined to disclose OpenDoor’s debt terms but said they are superior to what a typical home buyer gets on a mortgage.</i><p>The combination of high leverage and complete property ownership seems incredibly risky to me. If the country-wide housing market turns sour, not only is the company left with swiftly depreciating assets on their balance sheet as real estate values drop and people stop buying homes, but they are also left paying (probably 1-2%) interest on houses that they &quot;bought&quot; with these loans for $300k, but that are now worth $200k.<p>But the overall concept of increasing liquidity in the market by cutting out the broker and his&#x2F;her available hours, &quot;automating&quot; the valuation and bid process, using low short-term interest rates to flip houses, and pricing for volume and quick turnover is pretty cool. The key is sticking to &quot;commodity&quot; housing (cheap-mid range) and timing the market correctly.