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Lennar makes investment in home "trade-in" start-up

Published 01/24/2018, 11:34 AM
© Reuters.  Lennar makes investment in home "trade-in" start-up
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  • "Trading in a car is second nature to Americans, but no one thinks about that relative to a home,” says Lennar (NYSE:LEN) COO Jon Jaffe.
  • Opendoor is trying to do just that, offering sellers the ability to fill out a form online and receive an offer within hours. An inspector later confirms the home's condition, and adjusts the offer if needed. Opendoor then buys the home, makes repairs, and puts the property back on the market. For this service, Opendoor typically adds 100-150 basis points on top of the typical 6% broker commission
  • Lennar has been doing a test run of the service in Las Vegas, and is impressed enough be part of a group investing $135M in the start-up. Lennar's investment consists of $100M in debt through its Rialto Capital subsidiary.
  • Now read: Why The Real Estate Boom Has A Decade To Run


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