Opendoor Labs, an online home-buying platform, agreed on Monday to pay the Federal Trade Commission $ 62 million to resolve allegations that it used misleading marketing techniques to persuade people to sell their homes on the site. Did.
The FTC said Monday that homeowners could sell their homes faster than brokers, tricking customers into offering Opendoor at a lower price than offering real estate on the market. In a news release.. The agency said Opendoor has presented homeowners with a chart showing that they can make thousands of dollars more by selling real estate on the platform compared to traditional markets.
Opendoor said in statement On Monday, the company said it disagreed with FTC’s allegations that it was related to its business activities from 2017 to 2019.
In a statement, the company said, “We strongly oppose FTC’s allegations, but by deciding to settle with the committee, we can solve the problem and allow consumers to buy, sell and move easily, reliably and quickly. You will be able to focus on helping. “
The turmoil in the housing market is under increasing pressure as consumers tackle rising inflation, slumping home prices and rising mortgage rates. The average 30-year mortgage rate rose to 5.3 percent in July, According to Freddie MacA sharp increase from 2.87% in the previous year.
According to Zillow, home prices rose more than 20% year-on-year in May, but the market has cooled as mortgage rates have begun to rise. In June, real estate agents Redfin and Compass announced that they would dismiss employees because of falling demand and signs of a “housing recession.”
Opendoor is one of several services in the “iBuying” space that includes companies that use algorithms to determine the value of a home and buy it in cash. In September, iBuying accounted for 1% of US home sales.
“Opendoor has promised to revolutionize the real estate market, but has built a business using old-fashioned deception about how much consumers can make by selling homes on the platform,” FTC’s consumer protection said. Says Samuel Levine, director of the bureau. “There is nothing innovative about deceiving consumers.”
