- Brett and Jason Oppenheim are stars of “Selling Sunset” and owners of the show’s real estate group.
- They buy properties based on “perception,” buying poorly presented homes where they can add value.
Brett and Jason Oppenheim, the owners of The Oppenheim Group brokerage, might be better known for their appearances as peacemakers and romantic interests for the employees of the breakout Netflix show “Selling Sunset.”
But underneath lies a ruthless brokerage that handles hundreds of millions of dollars’ worth of properties each year and has estimated total sales of almost $2 billion since starting operations in 2014.
From a bedroom office to Sunset Boulevard
Despite hailing from a legacy of real estate dating back to their great-great-grandfather, who sold ranches in the 1800s, Jason started The Oppenheim Group brokerage in his spare bedroom with one intern. They eventually moved to Sunset Boulevard in Los Angeles, California, and now have another California office in Newport Beach.
He said the brokerage had seen revenue growth of 20-25% each year since, and that its smaller model allowed it to build partnerships with agents and maintain quality with only a handful of employees, which they argued protected them more from economic downturns than a typical, large-scale company.
“If there was a recession you’re going to see a lot of the major brokerages go bankrupt, or at least close to it,” Jason said. “Whereas our model can survive.”
Look for ‘hidden value’ and ignore ‘staging’
Brett and Jason always look for hidden value in a listing. While their standards and expectations are likely incredibly different from the average US resident, they argue it’s a strategy that scales down to first-time buyers who are increasingly priced out of a highly competitive market.
First-time buyers, Jason said, should first find a good agent in the area where they want to own a home, then focus on the detail of a property.
Jason described residential real estate as “emotional”, and that beyond the “intrinsic value” found in square footage, lot sizes and location, the presentation of a home could markedly change its valuation.
“You can turn a $300,000 home into a $330,000 home with the right framing,” Brett said.
Taking photos of your home on an iPhone, failing to tidy up, and bad “staging” — the presentation of a home — were red flags that the brothers said could devalue a home for a seller, and where buyers might find a bargain.
“I would try to pretend that the place is not furnished, and look at the views, how bright it is, the floor plan, the size, the location, and don’t be tricked by staging and paint and carpets,” Brett said.
Jason and Brett said they almost always buy poorly presented properties as they have the biggest potential to appreciate in value.
But Brett said these issues were mostly irrelevant if a buyer was prepared to sit on a house for at least 10 years.
It’s almost impossible to lose money in real estate if you can hold it for 10 years, according to Jason.
“The only time you get hurt in real estate is if you’re in a situation where you’re forced to sell,” Jason said. “If you are financially capable of holding the real estate through a downturn you will inevitably, at some point, have financial success with your asset.”
Why a housing crash is ‘unlikely’
The potential for that downturn has divided analysts, as annual price growth exceeds 15%, much higher than in the build-up to the crash of 2007-08. Brett and Jason, perhaps inevitably, fall on the bullish side.
Brett argued the last bubble was a result of too many buyers being accepted for a mortgage, which isn’t the case now. Meanwhile, Jason highlighted the lack of supply of homes, around half the rate of that at the time of the housing crash, as a major difference now.
“You have record equity in properties right now, and record low supply, and that’s going to continue,” Jason said. “So I think the market will continue to be stable for the foreseeable future.”