Knock

@seanblack @daveambrose As someone who recently sold a house, this is a great idea. I'm curious - How do you decide what market price is for a house if you can't sell it in 6 weeks?

Thanks @sbyrnes! The data science that determines the market price is part of our IP. We obviously put a lot of resources into automated valuation models (AVMs) at Trulia and Zillow (aka the Zestimate). But those models are limited by the fact that they never put eyes on the property. At Knock, we do an in-person inspection of every home that provides 200 proprietary data points never before used to price homes. If our algorithm is wrong we buy the property after 6 weeks, so we are very motivated to make it world class:-)

@seanblack eh, "not in your neighborhood yet". I've got a big expensive house I'd be happy to sell through you. Any ETA on Greenwich, CT?

@arlogilbert Kicking off with homes in Atlanta, where an amazing home is still close to the national median. Stay tuned for CT

@sam__cash I think you mean OpenDoor, as Nextdoor is the social network. First, Knock pays to promote your home on the open market for 6 weeks to attract multiple offers and maximize your price. This gives the seller confidence they got the highest price possible driven by the market, not us. This ensures we are aligned with the sellers' best interest. With Opendoor you can only consider their price in isolation without running a competitive process that oftentimes drives the price higher. Opendoor ultimately takes 15-20% of the sale price in order to buy the house outright: 6% Service Cost, 3-6% Market Risk Charge and they purchase the home 5-10% below the price they ultimately sell it for if you look at public records. We charge a flat 6% success fee, equal to the traditional listing commission. Most homeowners aren't so desperate to sell that they need to give up 15-20% of the value of their home. Most homeowners just need a guaranteed price and sale date for their home so they can make an offer a new one, put deposits down on schools, furniture, the moving truck etc without worrying their house won't sell in time. We believe the current cost of selling a home is already way too expensive. But we are offering a lot more convenience and certainty than traditional listings while building the technology necessary to put this incredibly laborious, inefficient and mostly offline process completely online and make it as automated as possible. As we do, we will attack more of the cost of selling a home at every point in the transaction.

@seanblack founder of Opendoor here. This is not true. Our average total service charge is 8.5% with over 1/3 of our homes having 6-7% total fees, and that proportion is increasing. On top of that, we don't offer below market price (we track very closely). Our resale delta you cite is likely accounted for in repairs and upgrades we invest.

@justindross thanks for clarifying. Congrats on the progress!

@seanblack Thanks. Was admittedly surprised you'd get those numbers so off given the amount of time your team spent on Opendoor.com getting inspiration 😂

@justindross we are actually going by public record data, which doesn't jive with the numbers you mentioned or publish on Opendoor.com. Public records show Opendoor selling homes for a pretty decent premium above the price at which it buys them from homeowners. It's only fair to assume that homeowners are giving up the difference.