Buy

A $13.5 Billion SPAC Sensation Will Buy Your House

Opendoor buys houses, refurbishes them and sells them a few months later. Essentially, it flips homes. The company rejects that description, however, and would prefer you called it an “iBuyer” — a technology-enabled, one-stop shop for homeowners who want to sell quickly with as little friction as possible. You enter your home address on the website, and some details about the state of the property and its features, and it makes you an offer.

In fairness, Opendoor makes most of its money from charging the seller a 6%-9% levy on the gross purchase price — not from buying low and selling high. (In the U.S. someone selling a house the old-fashioned way might pay 5%-6% in broker fees.) It sold almost 19,000 homes last year in 21 U.S. cities, although Phoenix, Dallas, Atlanta and Raleigh account for almost half of its revenue. Rival real-estate websites such as Zillow Group Inc. have also jumped aboard the iBuying bandwagon.

This is a very good moment to go public. America’s housing market is booming, thanks to rock-bottom interest rates and a pandemic-induced urge for more space and bigger gardens. Covid-19 infection concerns also validate Opendoor’s business model. Sellers who accept its algorithm-generated cash offer avoid human house-hunters traipsing through their living rooms. 

So far, investors have been willing to overlook Opendoor’s $900 million or so of losses since it was founded in 2014. They’ve also accepted that revenue may halve this year because the company paused the buying of properties during the pandemic and laid off a third of its staff. While it has restarted home purchases, revenue isn’t expected to recover until 2022. That’s an odd look for a high-growth company. 

When the Vision Fund last invested in 2019, it valued Opendoor at just $3.8 billion. This year, Social Capital Hedosophia Holdings

A $13 Billion SoftBank-Backed SPAC That Will Buy Your House

Opendoor buys houses, refurbishes them and sells them a few months later. Essentially, it flips homes. The company rejects that description, however, and would prefer you called it an “iBuyer” — a technology-enabled, one-stop shop for homeowners who want to sell quickly with as little friction as possible. You enter your home address on the website, and some details about the state of the property and its features, and it makes you an offer.

In fairness, Opendoor makes most of its money from charging the seller a 6%-9% levy on the gross purchase price — not from buying low and selling high. (In the U.S. someone selling a house the old-fashioned way might pay 5%-6% in broker fees.) It sold almost 19,000 homes last year in 21 U.S. cities, although Phoenix, Dallas, Atlanta and Raleigh account for almost half of its revenue. Rival real-estate websites such as Zillow Group Inc. have also jumped aboard the iBuying bandwagon.

This is a very good moment to go public. America’s housing market is booming, thanks to rock-bottom interest rates and a pandemic-induced urge for more space and bigger gardens. Covid-19 infection concerns also validate Opendoor’s business model. Sellers who accept its algorithm-generated cash offer avoid human house-hunters traipsing through their living rooms. 

So far, investors have been willing to overlook Opendoor’s $900 million or so of losses since it was founded in 2014. They’ve also accepted that revenue may halve this year because the company paused the buying of properties during the pandemic and laid off a third of its staff. While it has restarted home purchases, revenue isn’t expected to recover until 2022. That’s an odd look for a high-growth company. 

When the Vision Fund last invested in 2019, it valued Opendoor at just $3.8 billion. This year, Social Capital Hedosophia Holdings

Prime Day 2020 Deal: AeroGarden products up to 40% off at Best Buy

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AeroGarden Harvest Grey



Amazon


Winter is fast approaching, but an AeroGarden makes it easy to take your garden indoors. Select models are currently up to 40% off at Best Buy as part of their early Black Friday sale, a two-day event happening right now in tandem with Amazon Prime Day 2020.

AeroGarden’s Bounty is now only $249.99, a savings of $150 from its usual price of $399.99. It holds up to nine of your favorite crops with dimmable lights to mimic sunrise and sunset for natural growth, while vacation mode keeps plants healthy when you’re away from home.

Or, grow 12 plants of up to three feet in height with the AeroGarden Farm 12XL for just $419.99. Typically priced at $699.99, that’s 40% off for fresh produce all year long.

To use an Aerogarden, you simply pop in the seed pods and watch them sprout. A simple control panel reminds you when to add water and plant food, and the gardens are Wi-Fi enabled and Alexa-compatible, so no green thumb is required.

For more information on Best Buy deals, follow our coverage here. These deals will run parallel to Amazon Prime Day and shoppers will likely see a lot of comparable bargains and some overlap between the two. However, unlike Amazon, Best Buy is also offering curbside or store pickup and in-store shopping on their deals.

 

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Disclosure: This post is brought to you by the Insider Reviews team. We highlight products and services you might find interesting. If you buy them, we get a small share of the revenue from the sale from our commerce partners. We frequently receive products free of charge from

Is Home Insurance Required When You Buy a House?

If you’re buying a home, one question you might wonder is this: Is home insurance required when you own a house?

In many cases, homeowners insurance is indeed mandatory—and even in cases where it isn’t absolutely necessary, it’s still a good idea. To help you understand why, we’ve put together this Home Buyer’s Guide to Home Insurance, which will help walk you through what you need to know from beginning to end.

In this first article, we’ll introduce you to what homeowners insurance is, why it’s often essential, and what can go wrong if you don’t have it.

What is homeowners insurance?

With home insurance, as with other types of coverage (including health insurance), you pay a relatively small amount of money either monthly or annually in exchange for the promise that your provider will help you pay for unexpected costs you might incur as a homeowner.

What can go wrong? So much, including natural disasters, fires, crimes, accidents, and other emergencies, many of which can be expensive to fix. Without home insurance, you run the risk of getting stuck with a bill that could be in the tens of thousands of dollars. Home insurance offers protection and peace of mind that you won’t get hit with expenses that might be hard to pay on your own.

Why you need home insurance with a mortgage

If you need a mortgage on your home, most lenders will require you to get home insurance before they approve your loan and close the deal.

The reason: By loaning you money for the house, lenders are also investing in your property. If this investment suddenly plummets in value—since, say, a tornado turned it into a pile of rubble—it’s in your lender’s interests for you to have a home insurance plan that will rebuild

AutoZone and Three Other Retailers to Buy for the Election

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AutoZone is on Wells Fargo analyst Zachary Fadem’s list of best ideas..


Justin Sullivan/Getty Images

With the presidential election just over three weeks away,

Wells Fargo

took a look at what the results could mean for the retail sector. The bank found that the best bets are in home improvement and auto parts.

Analyst Zachary Fadem noted that Democratic nominee Joe Biden, now leading in the polls, has pledged to return corporate taxes to their level before the 2017 tax cuts, at around 28%. While that might be a concern for investors, he said retailers have advantages that could help offset the pain.

If limits on state and local tax deductions are also removed, he said, many consumers may spend more. Potential new tax credits, such as for child care, could also put more money into the pockets of low- and middle-class consumers, funds they might use for more shopping.

Ultimately, he said risks linked to the election are “relatively low for our coverage,” making it likely that recent trends will continue. He listed

AutoZone

(ticker: AZO),

O’Reilly Automotive

(ORLY),

Home Depot

(HD), and

Lowe’s

(LOW) as his best ideas, as he has previously.

In the five most recent election years, Fadem said, so-called hardline retailers, selling durable goods, outperformed the broader market in the three-, six-, and 12-month periods post-election.

Tractor Supply

(TSCO), O’Reilly,

Best Buy

(BBY), and

Williams-Sonoma

(WSM) were “notable standouts,” he said.

The pattern also held true in the final two months of presidential election years, which could bode well for the group going into the end of 2020.

With current tariffs remaining in place, the 28% tax rate Biden favors would chip away about 9% from the group’s earnings per share, on average, he says. Retailers with exposure to the highest-tax states, such