What happened
The S&P 500 index was modestly higher for most of Thursday morning, but real estate technology company Opendoor Technologies (OPEN 3.38%) was a major standout. As of 12:30 p.m. EDT, Opendoor's share price had rocketed higher by more than 17%.
So what
There are a couple of potential reasons for Opendoor's move today.
For one thing, iBuying stocks had largely taken a hit in recent days after Zillow (Z 1.68%) (ZG 1.70%) announced its decision to exit the business entirely. However, with Opendoor's business reportedly going quite well (we'll get actual earnings results next week), it appears these fears are overblown. In fact, with the second-largest iBuying company calling it quits, it reduces Opendoor's competition and creates an even larger growth opportunity.
Image source: Getty Images.
Second, Opendoor announced a new product called Opendoor Complete that aims to combine the entire home selling and buying process into one experience. According to Opendoor, 60% of sellers are also planning to buy another home, so the company aims to capture both sides of the transaction. Opendoor Complete allows people who sell their home to Opendoor to also place an offer on their next home that is backed by Opendoor's cash they'll receive upon closing the sale.
Now what
To be sure, the iBuying business has quite a way to go. It currently makes up about 1% of the U.S. real estate market by sales volume, and no company has figured out how to do it profitably just yet. However, Opendoor is the clear leader in the space, and if you're a fan of the iBuying business, the company could be worth a look, especially with a major competitive bowing out.
