Form 10-Q - Quarterly report [Sections 13 or 15(d)]

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission File Number: 001-39641

 

 

Offerpad Solutions Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware	85-2800538
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
2150 E. Germann Road, Suite 1, Chandler, Arizona	85286
(Address of principal executive offices)	(Zip Code)
[phone]
(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A common stock, $0.0001 par value per share		OPAD		The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer		☐		Accelerated filer		☒
Non-accelerated filer		☐		Smaller reporting company		☒
Emerging growth company		☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 29, 2024, there were 27,353,992 shares of Offerpad’s Class A common stock outstanding.

 

 

 

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OFFERPAD SOLUTIONS INC.

FORM 10-Q

FOR THE QUARTER ENDED June 30, 2024

TABLE OF CONTENTS

 

		Page
Cautionary Note Regarding Forward-Looking Statements		3
PART I.	FINANCIAL INFORMATION	4
Item 1.	Financial Statements	4
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Operations	5
	Condensed Consolidated Statements of Changes in Stockholders’ Equity	6
	Condensed Consolidated Statements of Cash Flows	8
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	35
Item 4.	Controls and Procedures	36
PART II.	OTHER INFORMATION	37
Item 1.	Legal Proceedings	37
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults Upon Senior Securities	37
Item 4.	Mine Safety Disclosures	37
Item 5.	Other Information	37
Item 6.	Exhibits	38
SIGNATURES		39

 

 

 

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Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q includes statements that express Offerpad Solutions Inc.’s (“Offerpad,” the “Company,” “we,” “us,” and “our,” and similar references) opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results and therefore are, or may be deemed to be, forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements can generally be identified by the use of forward-looking terminology, including the terms “believes,” “estimates,” “anticipates,” “expects,” “seeks,” “projects,” “intends,” “plans,” “may” or “should” or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. They may appear in a number of places throughout this Quarterly Report on Form 10-Q, including Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our future results of operations, financial condition and liquidity, our prospects, potential growth or expansion evaluations, strategies, including product and service offerings, macroeconomic trends, geopolitical concerns, and the markets in which Offerpad operates.

The forward-looking statements in this Quarterly Report on Form 10-Q are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to:

•

our ability to respond to general economic conditions;

•

the health of the U.S. residential real estate industry;

•

our ability to grow market share in our existing markets or any new markets we may enter;

•

our ability to grow effectively;

•

our ability to accurately value and manage real estate inventory, and to maintain an adequate and desirable supply of real estate inventory;

•

our ability to successfully launch new product and service offerings, and to manage, develop and refine our technology platform;

•

our ability to maintain and enhance our products and brand, and to attract customers;

•

our ability to achieve and maintain profitability in the future; and

•

the success of strategic relationships with third parties.

The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and other risks and uncertainties discussed in Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

The forward-looking statements in this Quarterly Report on Form 10-Q are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed as exhibits to this Quarterly Report on Form 10-Q with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q.

 

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 3

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

OFFERPAD SOLUTIONS INC.

Condensed Consolidated Balance Sheets

 

				June 30,				December 31,
(in thousands, except par value per share) (Unaudited)				2024				2023
ASSETS
Current assets:
Cash and cash equivalents				$	56,906			$	75,967
Restricted cash					16,092				3,967
Accounts receivable					6,745				9,935
Real estate inventory					307,750				276,500
Prepaid expenses and other current assets					3,545				5,236
Total current assets					391,038				371,605
Property and equipment, net					4,492				4,517
Other non-current assets					11,095				3,572
TOTAL ASSETS		(1)		$	406,625			$	379,694
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable				$	2,838			$	4,946
Accrued and other current liabilities					13,095				13,859
Secured credit facilities and other debt, net					271,887				227,132
Secured credit facilities and other debt - related party					31,899				30,092
Total current liabilities					319,719				276,029
Warrant liabilities					136				471
Other long-term liabilities					9,203				1,418
Total liabilities		(2)			329,058				277,918
Commitments and contingencies (Note 16)
Stockholders’ equity:
Class A common stock, $0.0001 par value; 2,000,000 shares authorized; 27,329 and 27,233 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively					3				3
Additional paid in capital					506,748				499,660
Accumulated deficit					(429,184	)			(397,887	)
Total stockholders’ equity					77,567				101,776
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY				$	406,625			$	379,694

________________

(1)

Our consolidated assets as of June 30, 2024 and December 31, 2023 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $16,092 and $3,867; Accounts receivable, $3,203 and $6,782; Real estate inventory, $307,750 and $276,500; Prepaid expenses and other current assets, $407 and $1,588; Total assets of $327,452 and $288,737, respectively.

(2)

Our consolidated liabilities as of June 30, 2024 and December 31, 2023 include the following liabilities for which the VIE creditors do not have recourse to Offerpad: Accounts payable, $1,903 and $1,798; Accrued and other current liabilities, $1,757 and $2,027; Secured credit facilities and other debt, net, $303,786 and $257,224; Total liabilities, $307,446 and $261,049, respectively.

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 4

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OFFERPAD SOLUTIONS INC.

Condensed Consolidated Statements of Operations

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
(in thousands, except per share data) (Unaudited)		2024				2023				2024				2023
Revenue		$	251,122			$	230,147			$	536,480			$	839,726
Cost of revenue			229,251				207,916				492,014				810,210
Gross profit			21,871				22,231				44,466				29,516
Operating expenses:
Sales, marketing and operating			20,230				29,040				42,682				71,391
General and administrative			10,538				12,713				22,493				27,192
Technology and development			964				2,312				2,737				4,553
Total operating expenses			31,732				44,065				67,912				103,136
Loss from operations			(9,861	)			(21,834	)			(23,446	)			(73,620	)
Other income (expense):
Change in fair value of warrant liabilities			(9	)			435				335				46
Interest expense			(4,581	)			(1,867	)			(9,486	)			(9,299	)
Other income, net			615				965				1,369				1,247
Total other expense			(3,975	)			(467	)			(7,782	)			(8,006	)
Loss before income taxes			(13,836	)			(22,301	)			(31,228	)			(81,626	)
Income tax benefit (expense)			54				(43	)			(69	)			(165	)
Net loss		$	(13,782	)		$	(22,344	)		$	(31,297	)		$	(81,791	)
Net loss per share, basic		$	(0.50	)		$	(0.82	)		$	(1.14	)		$	(3.21	)
Net loss per share, diluted		$	(0.50	)		$	(0.82	)		$	(1.14	)		$	(3.21	)
Weighted average common shares outstanding, basic			27,385				27,258				27,362				25,470
Weighted average common shares outstanding, diluted			27,385				27,258				27,362				25,470

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 5

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OFFERPAD SOLUTIONS INC.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

 

		Common Stock								Additional Paid in				Accumulated				Total Stockholders’
(in thousands) (Unaudited)		Shares				Amount				Capital				Deficit				Equity
Balance at March 31, 2024			27,300			$	3			$	503,500			$	(415,402	)		$	88,101
Issuance of common stock upon vesting of restricted stock units			29				—				(1	)			—				(1	)
Stock-based compensation expense			—				—				3,249				—				3,249
Net loss			—				—				—				(13,782	)			(13,782	)
Balance at June 30, 2024			27,329			$	3			$	506,748			$	(429,184	)		$	77,567

 

		Common Stock								Additional Paid in				Accumulated				Total Stockholders’
(in thousands) (Unaudited)		Shares				Amount				Capital				Deficit				Equity
Balance at March 31, 2023			26,507			$	3			$	493,614			$	(340,116	)		$	153,501
Issuance of common stock upon exercise of stock options			1				—				4				—				4
Issuance of common stock upon vesting of restricted stock units			3				—				(5	)			—				(5	)
Exercise of pre-funded warrants			714				—				—				—				—
Stock-based compensation expense			—				—				2,055				—				2,055
Net loss			—				—				—				(22,344	)			(22,344	)
Balance at June 30, 2023			27,225			$	3			$	495,668			$	(362,460	)		$	133,211

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 6

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OFFERPAD SOLUTIONS INC.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

 

		Common Stock								Additional Paid in				Accumulated				Total Stockholders’
(in thousands) (Unaudited)		Shares				Amount				Capital				Deficit				Equity
Balance at December 31, 2023			27,233			$	3			$	499,660			$	(397,887	)		$	101,776
Issuance of common stock upon exercise of stock options			5				—				16				—				16
Issuance of common stock upon vesting of restricted stock units			91				—				(44	)			—				(44	)
Stock-based compensation expense			—				—				7,116				—				7,116
Net loss			—				—				—				(31,297	)			(31,297	)
Balance at June 30, 2024			27,329			$	3			$	506,748			$	(429,184	)		$	77,567

 

		Common Stock								Additional Paid in				Accumulated				Total Stockholders’
(in thousands) (Unaudited)		Shares				Amount				Capital				Deficit				Equity
Balance at December 31, 2022			16,479			$	2			$	402,544			$	(280,669	)		$	121,877
Issuance of common stock upon exercise of stock options			14				—				53				—				53
Issuance of common stock upon vesting of restricted stock units			17				—				(53	)			—				(53	)
Issuance of pre-funded warrants, net			—				—				89,216				—				89,216
Exercise of pre-funded warrants			10,715				1				10				—				11
Stock-based compensation expense			—				—				3,898				—				3,898
Net loss			—				—				—				(81,791	)			(81,791	)
Balance at June 30, 2023			27,225			$	3			$	495,668			$	(362,460	)		$	133,211

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 7

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OFFERPAD SOLUTIONS INC.

Condensed Consolidated Statements of Cash Flows

 

		Six Months Ended
		June 30,
($ in thousands) (Unaudited)		2024				2023
Cash flows from operating activities:
Net loss		$	(31,297	)		$	(81,791	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation			314				380
Amortization of debt financing costs			1,153				1,980
Real estate inventory valuation adjustment			1,168				7,454
Stock-based compensation			7,116				3,898
Change in fair value of warrant liabilities			(335	)			(46	)
Change in fair value of derivative instruments			—				715
Loss on disposal of property and equipment			29				30
Changes in operating assets and liabilities:
Accounts receivable			3,190				871
Real estate inventory			(32,418	)			446,124
Prepaid expenses and other assets			2,091				313
Accounts payable			(2,108	)			1,693
Accrued and other liabilities			(902	)			(10,126	)
Net cash (used in) provided by operating activities			(51,999	)			371,495
Cash flows from investing activities:
Purchases of property and equipment			(362	)			(90	)
Proceeds from sale of property and equipment			44				—
Purchases of derivative instruments			—				(1,872	)
Net cash used in investing activities			(318	)			(1,962	)
Cash flows from financing activities:
Borrowings from credit facilities and other debt			495,955				411,990
Repayments of credit facilities and other debt			(450,546	)			(889,773	)
Payment of debt financing costs			—				(172	)
Proceeds from exercise of stock options			16				53
Payments for taxes related to stock-based awards			(44	)			(52	)
Borrowings from warehouse lending facility			—				18,488
Repayments of warehouse lending facility			—				(17,336	)
Proceeds from issuance of pre-funded warrants			—				90,000
Proceeds from exercise of pre-funded warrants			—				11
Issuance cost of pre-funded warrants			—				(784	)
Net cash provided by (used in) financing activities			45,381				(387,575	)
Net change in cash, cash equivalents and restricted cash			(6,936	)			(18,042	)
Cash, cash equivalents and restricted cash, beginning of period			79,934				140,299
Cash, cash equivalents and restricted cash, end of period		$	72,998			$	122,257
Reconciliation of cash, cash equivalents and restricted cash to the condensed consolidated balance sheet:
Cash and cash equivalents		$	56,906			$	115,599
Restricted cash			16,092				6,658
Total cash, cash equivalents and restricted cash		$	72,998			$	122,257
Supplemental disclosure of cash flow information:
Cash payments for interest		$	12,624			$	13,932

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 8

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1. Nature of Operations and Significant Accounting Policies

Description of Business

Offerpad, dedicated to simplifying the process of buying and selling homes, is committed to providing comprehensive solutions that remove the friction from real estate. Our advanced real estate platform offers a range of services, from consumer cash offers to B2B renovation solutions and industry partnership programs, all tailored to meet the unique needs of our clients. Since 2015, we’ve leveraged local expertise in residential real estate alongside proprietary technology to guide homeowners at every step.

The Company is currently headquartered in Chandler, Arizona and operates in over 1,800 cities and towns in 27 metropolitan markets across 17 states as of June 30, 2024.

Basis of Presentation and Interim Financial Information

The accompanying unaudited interim condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to GAAP and SEC rules and regulations. Accordingly, the unaudited interim condensed consolidated financial statements do not include all of the information and note disclosures required by GAAP for complete financial statements. Therefore, this information should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s audited consolidated financial statements as of and for the year ended December 31, 2023 included in the Company’s 2023 Annual Report on Form 10-K as filed with the SEC on February 27, 2024.

The accompanying financial information reflects all adjustments which are, in the opinion of the Company’s management, of a normal recurring nature and necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim periods. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).

Reverse Stock Split

On June 12, 2023, the Company filed a certificate of amendment to its Third Restated Certificate of Incorporation (as amended from time to time, the “Certificate of Incorporation”) with the Secretary of State of the State of Delaware to effect a 1-for-15 reverse stock split (the “Reverse Stock Split”). The Company’s Class A common stock began trading on a split-adjusted basis at market open on June 13, 2023 under the existing symbol “OPAD”.

Use of Estimates

The preparation of the Company’s condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements. Significant estimates include those related to the net realizable value of real estate inventory, among others. Actual results could differ from those estimates.

Principles of Consolidation

The Company’s condensed consolidated financial statements include the assets, liabilities, revenues and expenses of the Company, its wholly-owned operating subsidiaries and variable interest entities where the Company is the primary beneficiary. All intercompany accounts and transactions have been eliminated in consolidation.

Real Estate Inventory

Real estate inventory consists of acquired homes and is stated at the lower of cost or net realizable value, with cost and net realizable value determined by the specific identification of each home. Costs include initial purchase costs and renovation costs, as well as holding costs and interest incurred during the renovation period, prior to the listing date. Selling costs, including commissions and holding costs incurred after the listing date, are expensed as incurred and included in sales, marketing and operating expenses.

The Company reviews real estate inventory for valuation adjustments on a quarterly basis, or more frequently if events or changes in circumstances indicate that the carrying value of real estate inventory may not be recoverable. The Company evaluates real estate inventory for indicators that net realizable value is lower than cost at the individual home level. The

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 9

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Company generally considers multiple factors in determining net realizable value for each home, including recent comparable home sale transactions in the specific area where the home is located, the residential real estate market conditions in both the local market in which the home is located and in the U.S. in general, the impact of national, regional or local economic conditions and expected selling costs. When evidence exists that the net realizable value of real estate inventory is lower than its cost, the difference is recognized as a real estate inventory valuation adjustment in cost of revenue and the related real estate inventory is adjusted to its net realizable value.

For individual homes or portfolios of homes under contract to sell as of the real estate inventory valuation assessment date, if the carrying value exceeds the contract price less expected selling costs, the carrying value of these homes are adjusted to the contract price less expected selling costs. For all other homes, if the carrying value exceeds the expected sale price less expected selling costs, the carrying value of these homes are adjusted to the expected sale price less expected selling costs. Changes in the Company’s pricing assumptions may lead to a change in the outcome of the real estate inventory valuation analysis, and actual results may differ from the Company’s assumptions.

The Company recorded real estate inventory valuation adjustments of $0.6 million and $0.2 million during the three months ended June 30, 2024 and 2023, respectively, and $1.2 million and $7.5 million during the six months ended June 30, 2024 and 2023, respectively. Refer to Note 2. Real Estate Inventory, for further details.

Recent Accounting Standards

Income Tax Disclosures

In December 2023, the FASB issued a new standard which is intended to improve an entity’s income tax disclosures, primarily through disaggregated information about an entity’s effective income tax rate reconciliation and additional disclosures about income taxes paid. The new standard is effective for annual periods beginning after December 15, 2024. Accordingly, the new standard is effective for the Company on January 1, 2025 on a prospective basis. The Company is currently evaluating the impact that the standard will have on its condensed consolidated financial statements.

Segment Reporting

In November 2023, the FASB issued a new standard which is intended to improve disclosures about an entity’s reportable segments, primarily through enhanced disclosures about significant segment expenses. The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. Accordingly, the new standard is effective for the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and subsequent interim periods, using a retrospective approach. The Company is currently evaluating the impact that the standard will have on its condensed consolidated financial statements.

Note 2. Real Estate Inventory

The components of real estate inventory, net of applicable lower of cost or net realizable value adjustments, consist of the following as of the respective period ends:

		June 30,				December 31,
($ in thousands)		2024				2023
Homes preparing for and under renovation		$	87,383			$	53,116
Homes listed for sale			158,953				148,648
Homes under contract to sell			61,414				74,736
Real estate inventory		$	307,750			$	276,500

 

Note 3. Derivative Financial Instruments

During 2023, the Company entered into derivative arrangements pursuant to which the Company acquired options on U.S. Treasury futures. These options provided the Company with the right, but not the obligation, to purchase U.S. Treasury futures at a predetermined notional amount and stated term in the future.

During the six months ended June 30, 2023, the Company purchased $1.9 million of derivative instruments. During the three and six months ended June 30, 2023, the Company recorded changes in the fair value of the derivative instruments of ($0.1) million and ($0.7) million, respectively, in Other income, net in the condensed consolidated statements of operations.

The Company sold all of its outstanding derivative arrangements during October 2023 and no derivative arrangements remain outstanding.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 10

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 4. Property and Equipment

Property and equipment consist of the following as of the respective period ends:

		June 30,				December 31,
($ in thousands)		2024				2023
Rooftop solar panel systems		$	4,999			$	5,075
Leasehold improvements			1,071				1,130
Office equipment and furniture			833				837
Software systems			386				386
Computers and equipment			265				265
Construction in progress			394				32
Property and equipment, gross			7,948				7,725
Less: accumulated depreciation			(3,456	)			(3,208	)
Property and equipment, net		$	4,492			$	4,517

Depreciation expense was $0.1 million and $0.2 million during the three months ended June 30, 2024 and 2023, respectively, and $0.3 million and $0.4 million during the six months ended June 30, 2024 and 2023, respectively.

Note 5. Leases

The Company’s operating lease arrangements consist of its existing corporate headquarters in Chandler, Arizona, its future corporate headquarters in Tempe, Arizona, and field office facilities in most of the metropolitan markets in which the Company operates in the United States. These leases typically have original lease terms of 1 year to 10 years, and some leases contain multiyear renewal options. The Company does not have any finance lease arrangements.

The Company’s operating lease costs are included in operating expenses in the accompanying condensed consolidated statements of operations. During the three months ended June 30, 2024 and 2023, operating lease costs were $0.9 million and $0.6 million, respectively, and variable and short-term lease costs were less than $0.1 million during each of the respective periods. During the six months ended June 30, 2024 and 2023, operating lease costs were $1.8 million and $1.2 million, respectively, and variable and short-term lease costs were less than $0.1 million during each of the respective periods.

Cash payments for amounts included in the measurement of operating lease liabilities were $0.6 million during each of the three months ended June 30, 2024 and 2023, and $0.9 million and $1.2 million during the six months ended June 30, 2024 and 2023, respectively. There were no right-of-use assets obtained in exchange for new or acquired operating lease liabilities during three months ended June 30, 2024. Right-of-use assets obtained in exchange for new or acquired operating lease liabilities were $7.9 million during the six months ended June 30, 2024. There were no right-of-use assets obtained in exchange for new or acquired operating lease liabilities during both of the three and six months ended June 30, 2023.

As of June 30, 2024 and December 31, 2023, the Company’s operating leases had a weighted-average remaining lease term of 8.8 years and 1.8 years, respectively, and a weighted-average discount rate of 7.1% and 4.3%, respectively.

The Company’s operating lease liability maturities as of June 30, 2024 are as follows:

($ in thousands)
Remainder of 2024		$	1,165
2025			2,898
2026			2,089
2027			1,949
2028			1,922
2029			1,974
Thereafter			11,862
Total future lease payments			23,859
Less: Imputed interest			(7,105	)
Less: Tenant incentive receivable			(5,532	)
Total lease liabilities		$	11,222

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 11

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The Company’s operating lease right-of-use assets and operating lease liabilities, and the associated financial statement line items, are as follows as of the respective period ends:

				June 30,				December 31,
($ in thousands)		Financial Statement Line Items		2024				2023
Right-of-use assets		Other non-current assets		$	9,934			$	3,338
Lease liabilities:
Current liabilities		Accrued and other current liabilities			2,019				2,271
Non-current liabilities		Other long-term liabilities			9,203				1,418
Total lease liabilities				$	11,222			$	3,689

 

Note 6. Accrued and Other Liabilities

Accrued and other current liabilities consist of the following as of the respective period ends:

		June 30,				December 31,
($ in thousands)		2024				2023
Home renovation		$	3,318			$	3,534
Payroll and other employee related expenses			2,352				3,200
Operating lease liabilities			2,019				2,271
Marketing			1,894				999
Interest			1,729				1,989
Legal and professional obligations			604				392
Other			1,179				1,474
Accrued and other current liabilities		$	13,095			$	13,859

 

The Company incurred advertising expenses of $3.5 million and $10.9 million during the three months ended June 30, 2024 and 2023, respectively, and $7.9 million and $18.9 million during the six months ended June 30, 2024 and 2023, respectively.

Other long-term liabilities consists of the non-current portion of our operating lease liabilities as of June 30, 2024 and December 31, 2023.

Note 7. Credit Facilities and Other Debt

The carrying value of the Company’s credit facilities and other debt consists of the following as of the respective period ends:

	June 30,				December 31,
($ in thousands)	2024				2023
Credit facilities and other debt, net
Senior secured credit facilities with financial institutions	$	246,396			$	216,654
Senior secured credit facility with a related party		10,284				6,289
Mezzanine secured credit facilities with financial institutions		26,564				12,704
Mezzanine secured credit facilities with a related party		21,615				23,803
Debt issuance costs		(1,073	)			(2,226	)
Total credit facilities and other debt, net		303,786				257,224
Current portion - credit facilities and other debt, net
Total credit facilities and other debt, net		271,887				227,132
Total credit facilities and other debt - related party		31,899				30,092
Total credit facilities and other debt, net	$	303,786			$	257,224

The Company utilizes inventory financing facilities consisting of senior secured credit facilities, mezzanine secured credit facilities and other senior secured borrowing arrangements to provide financing for the Company’s real estate inventory purchases and renovation. Borrowings under the Company’s credit facilities and other debt are classified as current liabilities

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 12

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

on the accompanying condensed consolidated balance sheets as amounts drawn to purchase and renovate homes are required to be repaid as the related real estate inventory is sold, which is expected to be within 12 months.

As of June 30, 2024, the Company had a total borrowing capacity of $1,052.0 million under its senior secured credit facilities and mezzanine secured credit facilities, of which $512.2 million was committed. Any borrowings above the committed amounts are subject to the applicable lender’s discretion.

Under the Company’s senior secured credit facilities and mezzanine secured credit facilities, amounts can be borrowed, repaid and borrowed again during the revolving period. The borrowing capacity is generally available until the end of the applicable revolving period as reflected in the tables below. Outstanding amounts drawn under each senior secured credit facility and mezzanine secured credit facility are required to be repaid on the facility maturity date or earlier if accelerated due to an event of default or other mandatory repayment event.

The Company’s senior secured credit facilities and mezzanine secured credit facilities have aggregated borrowing bases, which increase or decrease based on the cost and value of the properties financed under a given facility and the time that those properties are in the Company’s possession. When the Company resells a home, the proceeds are used to reduce the corresponding outstanding balance under the related senior and mezzanine secured revolving credit facilities. The borrowing base for a given facility may be reduced as properties age beyond certain thresholds or the performance of the properties financed under that facility declines, and any borrowing base deficiencies may be satisfied through contributions of additional properties or partial repayment of the facility.

Senior Secured Credit Facilities

The following summarizes certain details related to the Company’s senior secured credit facilities (in thousands, except interest rates):

	Borrowing Capacity						Outstanding		Weighted- Average Interest		End of Revolving / Withdrawal		Final Maturity
As of June 30, 2024	Committed		Uncommitted		Total		Amount		Rate		Period		Date
Senior financial institution 1	$150,000		$250,000		$400,000		$112,927		8.13%		December 2025		June 2026
Senior financial institution 2	100,000		100,000		200,000		54,537		8.07%		January 2025		July 2025
Senior financial institution 3	100,000		50,000		150,000		59,337		8.58%		January 2025		April 2025
Related party	30,000		20,000		50,000		10,284		10.33%		March 2025		September 2025
Senior financial institution 4	30,000		45,000		75,000		19,595		9.83%		August 2024		February 2025
Senior secured credit facilities	$410,000		$465,000		$875,000		$256,680

 

	Borrowing Capacity												Outstanding				Weighted- Average Interest
As of December 31, 2023	Committed				Uncommitted				Total				Amount				Rate
Senior financial institution 1	$	200,000			$	200,000			$	400,000			$	135,676				7.91	%
Senior financial institution 2		100,000				100,000				200,000				55,541				7.61	%
Senior financial institution 3		100,000				50,000				150,000				6,453				7.11	%
Related party		30,000				20,000				50,000				6,289				10.05	%
Senior financial institution 4		30,000				45,000				75,000				18,984				8.42	%
Senior secured credit facilities	$	460,000			$	415,000			$	875,000			$	222,943

As of June 30, 2024, the Company had five senior secured credit facilities, four with separate financial institutions and one with a related party, which holds more than 5% of our Class A common stock. Borrowings under the senior secured credit facilities accrue interest at a rate based on a Secured Overnight Financing Rate (“SOFR”) reference rate, plus a margin which varies by facility. Each of the Company’s senior secured credit facilities also have interest rate floors. The Company may also pay fees on its senior secured credit facilities, including a commitment fee and fees on certain unused portions of the committed borrowing capacity under the respective credit agreements.

Borrowings under the Company’s senior secured credit facilities are collateralized by the real estate inventory financed by the senior secured credit facility. The lenders have legal recourse only to the assets securing the debt and do not have general recourse against the Company with limited exceptions. The Company has, however, provided limited non-recourse carve-out guarantees under its senior and mezzanine secured credit facilities for certain of the SPEs’ obligations. Each senior secured credit facility contains eligibility requirements that govern whether a property can be financed.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 13

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Mezzanine Secured Credit Facilities

The following summarizes certain details related to the Company’s mezzanine secured credit facilities (in thousands, except interest rates):

	Borrowing Capacity						Outstanding		Weighted- Average Interest		End of Revolving / Withdrawal		Final Maturity
As of June 30, 2024	Committed		Uncommitted		Total		Amount		Rate		Period		Date
Related party facility 1	$45,000		$25,000		$70,000		$19,111		13.83%		June 2025		December 2025
Mezzanine financial institution 1	22,500		22,500		45,000		10,714		13.92%		January 2025		July 2025
Mezzanine financial institution 2	26,667		13,333		40,000		15,850		12.58%		January 2025		April 2025
Related party facility 2	8,000		14,000		22,000		2,504		13.83%		March 2025		September 2025
Mezzanine secured credit facilities	$102,167		$74,833		$177,000		$48,179

 

	Borrowing Capacity						Outstanding		Weighted- Average Interest
As of December 31, 2023	Committed		Uncommitted		Total		Amount		Rate
Related party facility 1	$45,000		$25,000		$70,000		$22,250		11.56%
Mezzanine financial institution 1	22,500		22,500		45,000		11,198		12.79%
Mezzanine financial institution 2	26,667		13,333		40,000		1,506		9.55%
Related party facility 2	8,000		14,000		22,000		1,553		13.05%
Mezzanine secured credit facilities	$102,167		$74,833		$177,000		$36,507

As of June 30, 2024, the Company had four mezzanine secured credit facilities, two with separate financial institutions and two with a related party, which holds more than 5% of our Class A common stock. Borrowings under the Company’s mezzanine secured credit facilities accrue interest at a rate based on a SOFR reference rate, plus a margin which varies by facility. Each of the Company’s mezzanine secured credit facilities also have interest rate floors. The Company may also pay fees on its mezzanine secured credit facilities, including a commitment fee and fees on certain unused portions of the committed borrowing capacity under the respective credit agreements.

Borrowings under the Company’s mezzanine secured credit facilities are collateralized by a second lien on the real estate inventory financed by the relevant credit facility. The lenders have legal recourse only to the assets securing the debt, and do not have general recourse to Offerpad with limited exceptions.

The Company’s mezzanine secured credit facilities are structurally and contractually subordinated to the related senior secured credit facilities.

Maturities

Certain of the Company’s secured credit facilities mature within the next twelve months following the date these condensed consolidated financial statements are issued. The Company expects to enter into new financing arrangements or amend existing arrangements to meet its obligations as they come due, which the Company believes is probable based on its history of prior credit facility renewals. The Company believes cash on hand, together with proceeds from the resale of homes and cash from future borrowings available under each of the Company’s existing credit facilities or the entry into new financing arrangements, will be sufficient to meet its obligations as they become due in the ordinary course of business for at least 12 months following the date these condensed consolidated financial statements are issued.

Covenants for Senior Secured Credit Facilities and Mezzanine Secured Credit Facilities

The Company’s secured credit facilities include customary representations and warranties, covenants and events of default. Financed properties are subject to customary eligibility criteria and concentration limits. The terms of these facilities and related financing documents require the Company to comply with a number of customary financial and other covenants, such as maintaining certain levels of liquidity, tangible net worth or leverage (ratio of debt to tangible net worth).

As of June 30, 2024, the Company was in compliance with all covenants and no event of default had occurred.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 14

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 8. Warrant Liabilities

As of June 30, 2024, the Company had 16.1 million public warrants outstanding and 5.7 million private placement warrants outstanding, with every 15 warrants being exercisable to purchase one share of Class A common stock at an exercise price of $172.50 per share.

Public Warrants

The public warrants became exercisable on October 23, 2021. A holder may exercise its warrants only for a whole number of shares of Class A common stock. The public warrants will expire September 1, 2026, or earlier upon redemption or liquidation. Pursuant to the terms of the warrant agreements, the Company may call the public warrants for redemption for cash or redeem the outstanding warrants for shares of Class A common stock under certain scenarios. The public warrants are traded on an over-the-counter market.

Private Placement Warrants

The private placement warrants have terms and provisions that are substantially identical to those of the public warrants, with the exception of certain redemption rights, options to exercise and registration rights when the private placement warrants are owned by specified holders.

Note 9. Fair Value Measurements

The fair values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and certain prepaid and other current assets and accrued expenses approximate carrying values because of their short-term nature. The Company’s credit facilities are carried at amortized cost and the carrying value approximates fair value because of their short-term nature.

The Company’s liabilities that are measured at fair value on a recurring basis consist of the following (in thousands):

As of June 30, 2024		Quoted Prices in Active Markets for Identical Liabilities (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Public warrant liabilities		$	58			$	—			$	—
Private placement warrant liabilities		$	—			$	—			$	78

As of December 31, 2023		Quoted Prices in Active Markets for Identical Liabilities (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
Public warrant liabilities		$	305			$	—			$	—
Private placement warrant liabilities		$	—			$	—			$	166

Public Warrants

The public warrants are traded on an over-the-counter market. The fair value of the public warrants is estimated based on the quoted market price of such warrants on the valuation date. The Company recorded changes in the fair value of the public warrants of less than $0.1 million and $(0.3) million during the three months ended June 30, 2024 and 2023, respectively, and $(0.3) million and $(0.02) million during the six months ended June 30, 2024 and 2023, respectively. These changes are recorded in Change in fair value of warrant liabilities in our condensed consolidated statements of operations.

Private Placement Warrants

The following summarizes the changes in the Company’s private placement warrant liabilities, which are measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the respective periods:

		Three Months Ended June 30,								Six Months Ended June 30,
($ in thousands)		2024				2023				2024				2023
Beginning balance		$	75			$	285			$	166			$	196
Change in fair value of private placement warrants included in net loss			3				(114	)			(88	)			(25	)
Ending balance		$	78			$	171			$	78			$	171

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 15

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The Company generally uses the Black-Scholes-Merton option-pricing model to determine the fair value of the private placement warrants, with assumptions including expected volatility, expected life of the warrants, associated risk-free interest rate, and expected dividend yield.

There were no transfers between Levels 1, 2, and 3 during the three and six months ended June 30, 2024 and 2023.

Note 10. Stockholders’ Equity

Authorized Capital Stock

The Company’s is authorized to issue 2,100,000,000 shares of capital stock, which consists of 2,000,000,000 shares of Class A common stock and 100,000,000 shares of preferred stock, both of which have a par value $0.0001 per share.

Class A Common Stock

Our Class A common stock trades on the New York Stock Exchange under the symbol “OPAD” and our public warrants trade on the OTC Markets Group Pink Market under the symbol “OPADW.”

As of June 30, 2024, we had 27,329,264 shares of Class A common stock issued and outstanding.

We also have outstanding private placement warrants to purchase shares of our Class A common stock. Refer to Note 8. Warrant Liabilities.

During January 2023, we sold and issued pre-funded warrants to purchase shares of our Class A common stock, resulting in gross proceeds of approximately $90.0 million. The pre-funded warrants became exercisable during March 2023. All of the pre-funded warrants were subsequently exercised during 2023, upon which, 10.7 million shares of our Class A common stock were issued.

Preferred Stock

As of June 30, 2024, there were no shares of preferred stock issued and outstanding.

Dividends

Our Class A common stock is entitled to dividends if and when any dividend is declared by our Board, subject to the rights of all classes of stock outstanding having priority rights to dividends. We have not paid any cash dividends on common stock to date. We may retain future earnings, if any, for the further development and expansion of our business and have no current plans to pay cash dividends for the foreseeable future. Any future determination to pay dividends will be made at the discretion of our Board and will depend on, among other things, our financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as our Board may deem relevant.

Note 11. Stock-Based Awards

2021 Equity Incentive Plans

Incentive Award Plan

As of December 31, 2023, there were 1,755,548 shares of Class A common stock reserved for issuance under the Offerpad Solutions Inc. 2021 Incentive Award Plan (the “2021 Plan”).

Pursuant to the terms of the 2021 Plan, the number of shares of the Company’s Class A common stock available for issuance under the 2021 Plan automatically increased by 122,360 shares of Class A common stock on January 1, 2024. Following this increase, there were 1,877,908 shares reserved for issuance under the 2021 Plan as of June 30, 2024.

As of June 30, 2024, the Company has granted stock options, restricted stock units (“RSUs”), performance-based RSUs (“PSUs”) and other stock or cash-based awards under the 2021 Plan.

Employee Stock Purchase Plan

As of December 31, 2023, there were 175,554 shares of Class A common stock reserved for issuance under the Offerpad Solutions Inc. 2021 Employee Stock Purchase Plan (“ESPP”).

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 16

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Pursuant to the terms of the ESPP, the number of shares of the Company’s Class A common stock available for issuance under the ESPP automatically increased by 111,248 shares of Class A common stock on January 1, 2024. Following this increase, there were 286,802 shares reserved for issuance under the ESPP as of June 30, 2024.

As of June 30, 2024, no shares have been issued under the ESPP.

Restricted Stock Units

During the six months ended June 30, 2024, the Company granted RSUs with service vesting conditions to employees and non-employee members of our Board. The vesting period for RSUs granted to employees is generally three years, subject to continued employment, and the vesting period for RSUs granted to non-employee members of our Board generally ranges from three months to three years, subject to continued service on the Board.

The following summarizes RSU award activity during the six months ended June 30, 2024:

	Number of RSUs (in thousands)				Weighted Average Grant Date Fair Value
Outstanding as of December 31, 2023		250			$	29.77
Granted		900				5.23
Vested and settled		(96	)			24.60
Forfeited		(20	)			23.97
Outstanding as of June 30, 2024		1,034				9.00

As of June 30, 2024, 0.1 million RSUs have vested, but have not yet been settled in shares of the Company’s Class A common stock, pursuant to elections made by certain non-employee members of our Board to defer settlement thereof under the Offerpad Solutions Inc. Deferred Compensation Plan for Directors.

As of June 30, 2024, the Company had $5.7 million of unrecognized stock-based compensation expense related to unvested RSUs. This expense is expected to be recognized over a weighted average period of 2.59 years. The fair value of RSUs that vested and settled during the six months ended June 30, 2024 and 2023 was $1.8 million and $2.5 million, respectively.

Performance-Based Restricted Stock Units

The following summarizes PSU award activity during the six months ended June 30, 2024:

	Number of PSUs (in thousands)				Weighted Average Grant Date Fair Value
Outstanding as of December 31, 2023		119			$	70.81
Granted		—				—
Vested		—				—
Forfeited		—				—
Outstanding as of June 30, 2024		119				70.81

As of June 30, 2024, the Company had $1.9 million of unrecognized stock-based compensation expense related to unvested PSUs. This expense is expected to be recognized over a weighted average period of 0.67 years.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 17

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Other Cash or Stock-Based Awards

During the six months ended June 30, 2024, the Company granted long-term incentive awards, which include both a service vesting condition and a performance vesting condition that is associated with the share price of the Company’s Class A common stock (“LTI Award”). The Company also amended certain terms and conditions associated with the LTI Awards granted in 2023. Both the newly amended and granted LTI Awards will become earned during a three-year performance period based on the appreciation in the price of the Company’s Class A common stock over pre-determined price per share goals set forth in the LTI Award agreements. The portion of the LTI Award that will become earned will be determined based on the average share price over the 60 consecutive calendar-day period ending on (and including) the end of the performance period, the total number of shares of the Company’s Class A common stock outstanding as of the last day of the performance period and the participant sharing rates as set forth in the LTI Award agreements. To the extent that an LTI Award is earned during the performance period, half of the earned LTI Award will vest at the end of the three-year performance period, and the remaining half of the earned LTI Award will vest one year after the end of the performance period, in each case, subject to the employee’s continued service through the applicable vesting date. If the LTI Award does not become earned as of the last day of the performance period, each LTI Award automatically will be forfeited and terminated without consideration.

The Company determined the fair value of the LTI awards using a Monte Carlo simulation model that determines the probability of satisfying the market condition stipulated in the award. The assumptions used in the Monte Carlo simulation model to determine the fair value of the LTI Awards during the six months ended June 30, 2024 are as follows:

Risk-free interest rate		4.36%
Expected stock price volatility		95.0%
Expected dividend yield		0.0%
Fair value on grant date		$5.08

The LTI Awards, to the extent vested, can be settled in cash or shares of Company Class A common stock (as determined by the Compensation Committee of the Board in its discretion). As of June 30, 2024, the Company has the intent and ability to settle the LTI Awards in shares of the Company’s Class A common stock.

As of June 30, 2024, the Company had $3.4 million of unrecognized stock-based compensation expense related to the LTI Awards. This expense is expected to be recognized over a weighted average period of 3.45 years.

Stock Options

The following summarizes stock option activity during the six months ended June 30, 2024:

		Number of Shares  (in thousands)				Weighted- Average Exercise Price Per Share				Weighted Average Remaining Contractual Term (in years)				Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 2023			1,078			$	12.04				4.26			$	1,686
Granted			—				—
Exercised			(5	)			2.95
Forfeited, canceled or expired			(34	)			18.29
Outstanding as of June 30, 2024			1,039				11.89				3.71				314
Exercisable as of June 30, 2024			1,000				11.57				3.59				314
Vested and expected to vest as of June 30, 2024			1,039				11.89				3.71				314

The total intrinsic value of stock options exercised during the six months ended June 30, 2024 and 2023 was less than $0.1 million and $0.1 million, respectively.

As of June 30, 2024, the Company had unrecognized stock-based compensation expense related to unvested stock options of $0.6 million. This expense is expected to be recognized over a weighted average period of 0.87 years. The fair value of stock options that vested during the six months ended June 30, 2024 and 2023 was $0.6 million and $1.1 million, respectively.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 18

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Stock-based Compensation Expense

The following details stock-based compensation expense for the respective periods:

		Three Months Ended June 30,								Six Months Ended June 30,
($ in thousands)		2024				2023				2024				2023
Sales, marketing and operating		$	1,129			$	501			$	2,305			$	829
General and administrative			1,995				1,469				4,395				2,913
Technology and development			125				85				416				156
Stock-based compensation expense		$	3,249			$	2,055			$	7,116			$	3,898

 

Note 12. Variable Interest Entities

The Company formed certain special purpose entities (each, an “SPE”) to purchase and sell residential properties. Each SPE is a wholly-owned subsidiary of the Company and a separate legal entity, and neither the assets nor credit of any such SPE are available to satisfy the debts and other obligations of any affiliate or other entity. The credit facilities are secured by the assets and equity of one or more SPEs. These SPEs are variable interest entities, and the Company is the primary beneficiary as it has the power to control the activities that most significantly impact the SPEs’ economic performance and the obligation to absorb losses of the SPEs or the right to receive benefits from the SPEs that could potentially be significant to the SPEs. The SPEs are consolidated within the Company’s condensed consolidated financial statements.

The following summarizes the assets and liabilities related to the VIEs as of the respective period ends:

		June 30,				December 31,
($ in thousands)		2024				2023
Assets
Restricted cash		$	16,092			$	3,867
Accounts receivable			3,203				6,782
Real estate inventory			307,750				276,500
Prepaid expenses and other current assets			407				1,588
Total assets		$	327,452			$	288,737
Liabilities
Accounts payable		$	1,903			$	1,798
Accrued and other current liabilities			1,757				2,027
Secured credit facilities and other debt, net			303,786				257,224
Total liabilities		$	307,446			$	261,049

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 19

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 13. Earnings Per Share

Basic earnings per share is calculated based on the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated based on the weighted average number of common shares plus the incremental effect of dilutive potential common shares outstanding during the period. In periods when losses are reported, the weighted average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive.

The components of basic and diluted earnings per share are as follows:

		Three Months Ended June 30,								Six Months Ended June 30,
(In thousands, except per share data)		2024				2023				2024				2023
Numerator:
Net loss		$	(13,782	)		$	(22,344	)		$	(31,297	)		$	(81,791	)
Denominator:
Weighted average common shares outstanding, basic			27,385				27,258				27,362				25,470
Dilutive effect of stock options (1)			—				—				—				—
Dilutive effect of restricted stock units (1)			—				—				—				—
Weighted average common shares outstanding, diluted			27,385				27,258				27,362				25,470
Net loss per share, basic		$	(0.50	)		$	(0.82	)		$	(1.14	)		$	(3.21	)
Net loss per share, diluted		$	(0.50	)		$	(0.82	)		$	(1.14	)		$	(3.21	)
Anti-dilutive securities excluded from diluted loss per share:
Anti-dilutive stock options (1)			927				1,029				950				1,048
Anti-dilutive restricted stock units (1)			138				69				134				75
Anti-dilutive performance-based restricted stock units			119				127				119				127
Anti-dilutive warrants			1,452				1,452				1,452				1,452

(1) Due to the net loss during each of the three and six months ended June 30, 2024 and 2023, no dilutive securities were included in the calculation of diluted loss per share because they would have been anti-dilutive.

Note 14. Income Taxes

The Company determines its interim tax provision by applying the estimated effective income tax rate expected to be applicable for the full fiscal year to its income (loss) before income taxes for the period. The Company’s effective tax rate is dependent on several factors, such as tax rates in state jurisdictions and the relative amount of income the Company earns in the respective jurisdiction.

The Company recorded an income tax benefit of $0.1 million during the three months ended June 30, 2024 and income tax expense of less than $0.1 million during the three months ended June 30, 2023, and income tax expense of $0.1 million and $0.2 million during the six months ended June 30, 2024 and 2023, respectively. The Company’s effective tax rate was a benefit of 0.4% and an expense of 0.2% for the three months ended June 30, 2024 and 2023, respectively, and an expense of 0.2% for each of the six months ended June 30, 2024 and 2023, respectively. The Company’s effective tax rate during the three and six months ended June 30, 2024 differed from the federal statutory rate of 21% primarily due to net operating loss carryforwards and state taxes. The valuation allowance recorded against our net deferred tax assets was $111.0 million as of June 30, 2024.

As of June 30, 2024, we continue to have a full valuation allowance recorded against all deferred tax assets and will continue to evaluate our valuation allowance in future periods for any change in circumstances that causes a change in judgment about the realizability of the deferred tax assets. The amount of the deferred tax assets considered realizable, however, could be adjusted in future periods if estimates of future taxable income during the carryforward period are increased, if objective negative evidence in the form of cumulative losses is no longer present, and if we employ tax planning strategies in the future.

The Internal Revenue Code contains provisions that limit the utilization of net operating loss carryforwards and tax credit carryforwards if there has been an ownership change. Such ownership change, as described in Section 382 of the Internal Revenue Code, may limit the Company’s ability to utilize its net operating loss carryforwards and tax credit carryforwards on a yearly basis. To the extent that any single-year limitation is not utilized to the full amount of the limitation, such unused amounts are carried over to subsequent years until the earlier of utilization or the expiration of the relevant carryforward period. The Company determined that an ownership change occurred on February 10, 2017. An analysis was performed and while utilization of net operating losses would be limited in years prior to December 31, 2020, subsequent to that date, there is

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 20

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

no limitation on the Company’s ability to utilize its net operating losses. As such, the ownership change has no impact to the carrying value of the Company’s net operating loss carryforwards or ability to use them in future years.

Note 15. Related-Party Transactions

LL Credit Facilities

As of June 30, 2024, we have one senior secured credit facility with a related party and two mezzanine secured credit facilities with a related party (the “LL Credit Facilities”). The following summarizes certain details related to these facilities:

		As of June 30, 2024								As of December 31, 2023
($ in thousands)		Borrowing Capacity				Outstanding Amount				Borrowing Capacity				Outstanding Amount
Senior secured credit facility with a related party		$	50,000			$	10,284			$	50,000			$	6,289
Mezzanine secured credit facilities with a related party		$	92,000			$	21,615			$	92,000			$	23,803

Since October 2016, we have been party to a loan and security agreement (the “LL Funds Loan Agreement”), with LL Private Lending Fund, L.P. and LL Private Lending Fund II, L.P., both of which are affiliates of LL Capital Partners I, L.P., which holds more than 5% of our Class A common stock. Additionally, Roberto Sella, who is a member of our Board and holds more than 5% of our Class A common stock, is the managing partner of LL Funds. The LL Funds Loan Agreement is comprised of a senior secured credit facility and a mezzanine secured credit facility, under which we may borrow funds up to a maximum principal amount of $50.0 million and $22.0 million, respectively. The LL Funds Loan Agreement also provides us with the option to borrow above the fully committed borrowing capacity, subject to the lender’s discretion. Refer to Note 7. Credit Facilities and Other Debt, for further details about the facilities under the LL Funds Loan Agreement.

Since March 2020, we have also been party to a mezzanine loan and security agreement (the “LL Mezz Loan Agreement”), with LL Private Lending Fund II, L.P., which is an affiliate of LL Capital Partners I, L.P. Under the LL Mezz Loan Agreement, we may borrow funds up to a maximum principal amount of $70.0 million. Refer to Note 7. Credit Facilities and Other Debt, for further details about the mezzanine facility under the LL Mezz Loan Agreement.

We paid interest for borrowings under the LL Credit Facilities of $0.8 million and $0.7 million during the three months ended June 30, 2024 and 2023, respectively, and $1.8 million and $2.2 million during the six months ended June 30, 2024 and 2023, respectively.

Use of First American Financial Corporation’s Services

First American Financial Corporation (“First American”), which holds more than 5% of our Class A common stock, through its subsidiaries is a provider of title insurance and settlement services for real estate transactions and a provider of property data services. Additionally, Kenneth DeGiorgio, who is a member of the Company’s Board, is the chief executive officer of First American. We use First American’s services in the ordinary course of our home-buying and home-selling activities. We paid First American $1.5 million and $1.6 million during the three months ended June 30, 2024 and 2023, respectively, and $3.2 million and $4.3 million during the six months ended June 30, 2024 and 2023, respectively, for its services, inclusive of the fees for property data services.

Compensation of Immediate Family Members of Brian Bair

Offerpad employs two of Brian Bair’s brothers, along with Mr. Bair’s sister-in-law. The following details the total compensation paid to Mr. Bair’s brothers and Mr. Bair’s sister-in-law, which includes both base salary and annual performance-based cash incentives during each of the respective periods:

		Three Months Ended June 30,								Six Months Ended June 30,
($ in thousands)		2024				2023				2024				2023
Mr. Bair’s brother 1		$	99			$	99			$	262			$	468
Mr. Bair’s brother 2			92				92				245				440
Mr. Bair’s sister-in-law			31				29				67				80
		$	222			$	220			$	574			$	988

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 21

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OFFERPAD SOLUTIONS INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

During the six months ended June 30, 2024, Mr. Bair’s brothers and Mr. Bair’s sister-in-law received the following restricted stock unit awards:

Mr. Bair’s brother 1			42,500
Mr. Bair’s brother 2			40,000
Mr. Bair’s sister-in-law			6,000
			88,500

During the six months ended June 30, 2024, the Company amended certain terms and conditions associated with the LTI Awards granted to Mr. Bair’s brothers and Mr. Bair’s sister-in-law in 2023, including the performance period, price per share goals and sharing rates.

Refer to Note 11. Stock-Based Awards, for further details.

Warehouse Lending Facility with FirstFunding, Inc.

During 2022, Offerpad Mortgage, LLC (“Offerpad Home Loans” or “OPHL”), a wholly-owned subsidiary of the Company, entered into a warehouse lending facility with FirstFunding, Inc., a wholly-owned subsidiary of First American, which holds more than 5% of our Class A common stock. Offerpad Home Loans used the warehouse lending facility to fund mortgage loans it originated and then sold to third-party mortgage servicers. During April 2024, the warehouse lending facility expired and was not renewed. The fees paid under the facility were immaterial during the periods in which the facility was used.

Pre-Funded Warrants

During January 2023, the Company sold and issued pre-funded warrants to purchase shares of the Company’s Class A common stock. The investors included Brian Bair, Roberto Sella, First American, and Kenneth DeGiorgio. Refer to Note 10. Stockholders’ Equity, for further details.

 

Note 16. Commitments and Contingencies

Homes Purchase Commitments

As of June 30, 2024, the Company was under contract to purchase 359 homes for an aggregate purchase price of $102.7 million.

Lease Commitments

The Company has entered into operating lease agreements for its existing corporate headquarters in Chandler, Arizona, its future corporate headquarters in Tempe, Arizona, and field office facilities in most of the metropolitan markets in which the Company operates in the United States. Refer to Note 5. Leases, for further details.

Legal and Other Matters

The Company is subject to various actions, claims, suits and other legal proceedings that arise in the ordinary course of business, including, without limitation, assertions by third parties relating to intellectual property infringement, breaches of contract or warranties or employment-related matters. The Company records accruals for loss contingencies when it is probable that a loss will occur, and the amount of such loss can be reasonably estimated. The Company is not currently a party to any actions, claims, suits or other legal proceedings, the outcome of which, if determined adversely to the Company, would individually or in the aggregate have a material adverse effect on the Company’s condensed consolidated financial statements.

 

Note 17. Subsequent Events

The Company has determined that there have been no events that have occurred that would require recognition in the condensed consolidated financial statements or additional disclosure herein.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 22

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis provides information that Offerpad’s management believes is relevant to an assessment and understanding of Offerpad’s consolidated results of operations and financial condition. The discussion should be read together with the unaudited interim condensed consolidated financial statements and accompanying notes included in Part I, Item 1 of this Quarterly Report on Form 10-Q and our audited consolidated financial statements and accompanying notes included in Item 8 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on February 27, 2024.

This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. See “Cautionary Note Regarding Forward-Looking Statements” in this Form 10-Q. Offerpad’s actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Risk Factors” in Part I, Item 1A of Offerpad’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Overview

Our Business

Offerpad, dedicated to simplifying the process of buying and selling homes, is committed to providing comprehensive solutions that remove the friction from real estate. Our advanced real estate platform offers a range of services, from consumer cash offers to B2B renovation solutions and industry partnership programs, all tailored to meet the unique needs of our clients. Since 2015, we’ve leveraged local expertise in residential real estate alongside proprietary technology to guide homeowners at every step, and have transacted on homes representing approximately $11.3 billion of aggregate revenue through June 30, 2024.

We are currently headquartered in Chandler, Arizona and operate in over 1,800 cities and towns in 27 metropolitan markets across 17 states as of June 30, 2024.

Current Economic Conditions and Health of the U.S. Residential Real Estate Industry

Our business and operating results are impacted by the general economic conditions and the health of the U.S. residential real estate industry, particularly the single-family home resale market. Our business model primarily depends on a high volume of residential real estate transactions throughout the markets in which we operate. This transaction volume affects substantially all of the ways that we generate revenue, including our ability to acquire new homes and generate associated fees, and our ability to sell homes that we own.

During the first half of 2024, the residential real estate market conditions continued to evolve and present challenges, with the mortgage interest rate environment remaining volatile during the period, along with sustained elevated levels of inflation in the broader economy, a limited supply of single-family homes and various other macroeconomic and geopolitical concerns. The average thirty-year fixed mortgage rate generally increased throughout the first half of the year, peaking in the mid-7% range in April 2024, before decreasing to around 7% at the end of June 2024. This elevated and volatile mortgage interest rate environment has continued to negatively impact housing affordability and create uncertainty for home buyers, which has challenged consumer demand for residential real estate. As a result of these conditions, we have remained focused on proactively optimizing our capital allocation across our highest performing and most efficient markets and balancing our real estate inventory acquisition pace to optimize our return.

Against this backdrop, we achieved year-over-year improvements in our revenue and net loss during the second quarter of 2024, and our gross profit margin improved on a quarter-over-quarter basis for the second consecutive quarter, reflecting our continued progress toward improving the stability of our gross profit margin. Further, we slightly increased our real estate inventory acquisition pace during the second quarter of 2024 as compared to the first quarter of 2024 and we had $307.8 million of homes in real estate inventory as of June 30, 2024.

While we generated solid operating results during the first half of 2024, the ongoing challenging residential real estate market conditions continued to have an impact on our operating results. These conditions have required us to use pricing adjustments and other incentives in recent periods, which had a negative impact on our operating results during the first half of 2024. Further, there continues to be uncertainty regarding the near-term macroeconomic conditions, including the path of ongoing inflation in the broader economy, the direction of mortgage interest rates and the impact of geopolitical conflicts. We anticipate that the ongoing higher mortgage interest rate environment, economic uncertainties and affordability pressures will continue to impact consumer demand for residential real estate during the third quarter of 2024. As a result of these market dynamics, we may be required to use similar pricing adjustments and incentives in the future.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 23

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Factors Affecting Our Performance

We believe that our performance and future success depend on a variety of factors that present significant opportunities for our business but also present risks and challenges that could adversely impact our growth and profitability, including those discussed below.

Market Penetration in Existing Markets

Residential real estate is one of the largest industries, with roughly $1.9 trillion in value of homes transacted in 2023 in the United States, and is highly fragmented with over 100,000 real estate brokerages, according to the National Association of Realtors (NAR). In 2023, we estimate that we captured roughly 0.5% market share of real estate transactions across our 25 active markets as of December 31, 2023. Given this high degree of fragmentation, we believe that bringing a solutions-oriented approach to the market with multiple buying and selling services to meet the unique needs of customers could lead to continued market share growth and accelerated adoption of the digital model. We have demonstrated higher market share in certain markets, providing the backdrop to grow our overall market penetration as our offerings expand and evolve. By providing a consistent, transparent, and unique experience, we expect to continue to build upon our past success and further strengthen our brand and consumer adoption.

We are also increasing our focus on our partner network, which includes our homebuilder services, our agent partnership program and our agent referral network, to drive growth in our existing markets by expanding our reach and serving a greater number of customers. Our agent partnership program provides referral fees to agents who sell or select our cash offer. This program is designed to enable customers to utilize our services in a way that best suits their home-selling situation, while also serving as a valuable resource for real estate agents.

In order to drive additional value from our agent partnership program, we implemented various enhancements to the program during the first half of 2024. Under the enhanced program, our partner agents can continue to request a cash offer on behalf of their clients, and now also have the ability to list an acquired home and ready for resale. Additionally, partner agents in the top tier of the program have access to sellers in defined zones and have the potential to list other Offerpad-owned homes in their zone.

Further, during the second quarter of 2024, we launched a new integration with Realtor.com, allowing customers to request a cash offer from Offerpad directly through the Realtor.com website. We anticipate this integration will further expand our reach and diversify our lead sources.

Expansion into New Markets

Since our launch in 2015, we have expanded into 25 markets as of December 31, 2023, which covered roughly 22% of the 4.7 million homes sold in the United States in 2023. Given this current coverage, we believe there is significant opportunity to both increase market penetration in our existing markets and to grow our business through new market expansion over the long-term. Also, because of our strategic approach to our asset-light platform offerings, which include our listing and renovation services, and our agent partnership program, we believe a significant portion of the total addressable market is serviceable with our business model. As we expand our reach through these other service offerings, we expect to continue to serve customers in markets beyond our direct service area. Further, this strategic approach has enabled us to enter into new markets to offer certain of our service offerings, without offering all of our buying and selling services in such markets. In connection with this approach, we began offering renovation services in two additional markets during the first half of 2024, bringing our total markets served to 27 as of June 30, 2024.

Although we recently expanded into two new markets, we have decelerated our market expansion plans in recent years given the challenging residential real estate market conditions and the uncertainty regarding the near-term macroeconomic conditions, including the path of ongoing inflation in the broader economy, the direction of mortgage interest rates and the impact of geopolitical conflicts. We intend to continue evaluating expansion plans on an ongoing basis in order to maintain our flexibility in assessing the overall timing of our expansion plan and appropriate market entry points in the future.

Renovation Services

Our renovation services represent an important component of our asset-light platform offerings. Through our renovation services offering, we are able to leverage our existing logistics, operations, technology and skill-sets to provide renovation services to other businesses, allowing other companies and homeowners to utilize our renovations team to update their portfolio of homes for rent or to sell. When providing renovation services, we receive a renovation project fee, and are also typically compensated with a service fee that is based on a percentage of the overall renovation project fee. Although our renovation services offering is in the early stages, representing approximately 2% of our total consolidated revenue during each of the three and six months ended June 30, 2024, we believe these services could be a more significant component of our business over time.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 24

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Expand Relationships with Home Buyers

Another component of our asset-light platform offerings includes our program that allows investors and single-family rental companies an opportunity to purchase homes from homeowners, matching investors with sellers. These transactions occur in several forms, including assigning the original purchase contract to the end buyer and collecting a fee at closing. We expect this program will allow us to help more homeowners sell their home and expand our ability to reach more customers, while also providing customers with the benefit of receiving an optimized offer for their home. This offering represented less than 1% of our total consolidated revenue during each of the three and six months ended June 30, 2024.

Ancillary Products and Services

We aim to deliver other additional products and services to customers in a smooth, efficient, digital driven platform, focused on transparency and ease of use. The primary goal is to be able to offer multiple services tied to the core real estate transaction, allowing customers to bundle and save. Although further developing these products and services will require significant investment, growing our current offerings and offering additional ancillary products and services, potentially including energy efficiency solutions, smart home technology, insurance, and home warranty services, we believe will strengthen our unit economics and allow us to better optimize pricing. Generally, the revenue and margin profiles of our ancillary products and services are different from our cash offering service that accounts for the vast majority of our revenue, with most ancillary products and services having a smaller average revenue per transaction than our cash offering service, but a higher margin.

Below is a summary of our current ancillary products and services:

•

Title and Escrow: We have a national relationship with a leading title and escrow company, through which we are able to leverage our size and scale to provide exceptional title and escrow closing services with favorable economics.

•

Offerpad Home Loans (“OPHL”): We have historically provided access to mortgage services through either our in-house mortgage solution, OPHL, or a third-party lending partner.

•

Bundle Rewards: The Offerpad Bundle Rewards program allows customers to receive discounts when combining multiple Offerpad products and services, including selling and buying a home.

Our ancillary products and services represented less than 1% of our total consolidated revenue during each of the three and six months ended June 30, 2024.

Unit Economics

We view Contribution Margin and Contribution Margin after Interest (see “—Non-GAAP Financial Measures”) as key performance indicators for unit economic performance, which are currently primarily driven by our cash offer transactions. Future financial performance improvements are expected to be driven by expanding unit level margins through initiatives such as:

•

Continued optimization of acquisition, renovation, and resale processes and strategies, as we increase our market penetration in existing markets;

•

Effectively increasing and expanding our listing service business alongside the cash offer business, optimizing customer and agent community engagement and increasing conversion of requests for home purchases; and

•

Introducing and scaling additional ancillary products and services to complement our core cash offer and listing service products.

Operating Leverage

We utilize our technology and product teams to design systems and workflows to make our operations teams more efficient and able to support and scale with the business. Many positions are considered volume based, and as our business grows, we focus on developing more automation tools to gain additional leverage. Additionally, in periods when our business is growing, we expect to be able to gain operating leverage on portions of our cost structure that are more fixed in nature as opposed to purely variable. These types of costs include general and administrative expenses and certain marketing and information technology expenses, which grow at a slower pace than proportional to revenue growth.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 25

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Real Estate Inventory Financing

Our business model requires significant capital to purchase real estate inventory. Real estate inventory financing is a key enabler to our growth and we rely on our non-recourse asset-backed financing facilities, which primarily consist of senior and mezzanine secured credit facilities to finance our home purchases. The loss of adequate access to these types of facilities, or the inability to maintain these types of facilities on favorable terms, would impair our performance. See “—Liquidity and Capital Resources—Financing Activities.”

Seasonality

The residential real estate market is seasonal and varies from market to market. Typically, the greatest number of transactions occur in the spring and summer, with fewer transactions occurring in the fall and winter. Our financial results, including revenue, margins, real estate inventory, and financing costs, have historically had seasonal characteristics generally consistent with the residential real estate market, a trend we expect to continue in the future, subject to the market conditions discussed above.

Risk Management

Our business model is based upon acquiring homes at a price which will allow us to provide a competitive offer to the consumer, while being able to add value through the renovation process, and relist the home so that it sells at a profit and in a relatively short period of time. We have invested significant resources into our underwriting and asset management systems. Our real estate operations team, including our pricing team, together with our software engineering and data science teams are responsible for underwriting accuracy, portfolio health, and workflow optimization. Our underwriting tools are constantly updated to adjust to the latest market conditions, leveraging inputs from our internal data systems, as well as third-party and other proprietary data sources. This allows us to assess and adjust to changes in the local housing market conditions based on our technology, analysis and local real estate experience, in order to mitigate our risk exposure. Further, our listed homes are typically in market-ready and move-in ready condition following the repairs and renovations we conduct.

Historically, we have been able to manage our portfolio risk in part by our ability to manage holding periods for our real estate inventory. Traditionally, resale housing pricing moves gradually through cycles; therefore, shorter real estate inventory holding periods limit pricing exposure. As we increased our scale and improved our workflow optimization in prior years, our average real estate inventory holding period of homes sold improved from 138 days in 2016 to 97 days during the fourth quarter of 2023, which is consistent with our expected average real estate inventory holding period and our historical norm. The average holding period of homes sold increased to 113 days during the first quarter of 2024, reflecting the anticipated, normal seasonal increase.

During the second quarter of 2024, the average holding period of homes sold decreased to 106 days, as we increased our home acquisition pace for the second consecutive quarter and our overall real estate inventory mix shifted to include a greater composition of newer acquired homes. Based on current residential real estate market conditions, we anticipate our average real estate inventory holding period in the third quarter of 2024 will remain consistent at around 110 days.

Non-GAAP Financial Measures

In addition to our results of operations below, we report certain financial measures that are not required by, or presented in accordance with, U.S. generally accepted accounting principles (“GAAP”). These measures have limitations as analytical tools when assessing our operating performance and should not be considered in isolation or as a substitute for GAAP measures, including gross profit and net income. We may calculate or present our non-GAAP financial measures differently than other companies who report measures with similar titles and, as a result, the non-GAAP financial measures we report may not be comparable with those of companies in our industry or in other industries.

Adjusted Gross Profit, Contribution Profit, and Contribution Profit After Interest (and related margins)

To provide investors with additional information regarding our margins, we have included Adjusted Gross Profit, Contribution Profit, and Contribution Profit After Interest (and related margins), which are non-GAAP financial measures. We believe that Adjusted Gross Profit, Contribution Profit, and Contribution Profit After Interest are useful financial measures for investors as they are used by management in evaluating unit level economics and operating performance across our markets. Each of these measures is intended to present the economics related to homes sold during a given period. We do so by including revenue generated from homes sold (and ancillary services) in the period and only the expenses that are directly attributable to such home sales, even if such expenses were recognized in prior periods, and excluding expenses related to homes that remain in real estate inventory as of the end of the period presented. Contribution Profit provides investors a measure to assess Offerpad’s ability to generate returns on homes sold during a reporting period after considering home acquisition costs, renovation and repair costs, and adjusting for holding costs and selling costs. Contribution Profit After Interest further impacts gross profit by including interest costs (including senior and mezzanine secured credit facilities) attributable to homes sold

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 26

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during a reporting period. We believe these measures facilitate meaningful period over period comparisons and illustrate our ability to generate returns on assets sold after considering the costs directly related to the assets sold in a presented period.

Adjusted Gross Profit, Contribution Profit and Contribution Profit After Interest (and related margins) are supplemental measures of our operating performance and have limitations as analytical tools. For example, these measures include costs that were recorded in prior periods under GAAP and exclude, in connection with homes held in real estate inventory at the end of the period, costs required to be recorded under GAAP in the same period.

Accordingly, these measures should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. We include a reconciliation of these measures to the most directly comparable GAAP financial measure, which is gross profit.

Adjusted Gross Profit / Margin

We calculate Adjusted Gross Profit as gross profit under GAAP adjusted for (1) net real estate inventory valuation adjustment plus (2) interest expense associated with homes sold in the presented period and recorded in cost of revenue. Net real estate inventory valuation adjustment is calculated by adding back the real estate inventory valuation adjustment charges recorded during the period on homes that remain in real estate inventory at period end and subtracting the real estate inventory valuation adjustment charges recorded in prior periods on homes sold in the current period. We define Adjusted Gross Margin as Adjusted Gross Profit as a percentage of revenue.

We view this metric as an important measure of business performance, as it captures gross margin performance isolated to homes sold in a given period and provides comparability across reporting periods. Adjusted Gross Profit helps management assess performance across the key phases of processing a home (acquisitions, renovations, and resale) for a specific resale cohort.

Contribution Profit / Margin

We calculate Contribution Profit as Adjusted Gross Profit, minus (1) direct selling costs incurred on homes sold during the presented period, minus (2) holding costs incurred in the current period on homes sold during the period recorded in sales, marketing, and operating, minus (3) holding costs incurred in prior periods on homes sold in the current period recorded in sales, marketing, and operating, plus (4) other income, net which is primarily composed of interest income earned on our cash and cash equivalents and fair value adjustments of derivative financial instruments. The composition of our holding costs is described in the footnotes to the reconciliation table below. We define Contribution Margin as Contribution Profit as a percentage of revenue.

We view this metric as an important measure of business performance as it captures the unit level performance isolated to homes sold in a given period and provides comparability across reporting periods. Contribution Profit helps management assess inflows and outflow directly associated with a specific resale cohort.

Contribution Profit / Margin After Interest

We define Contribution Profit After Interest as Contribution Profit, minus (1) interest expense associated with homes sold in the presented period and recorded in cost of revenue, minus (2) interest expense associated with homes sold in the presented period, recorded in costs of sales, and previously excluded from Adjusted Gross Profit, and minus (3) interest expense under our senior and mezzanine secured credit facilities incurred on homes sold during the period. This includes interest expense recorded in prior periods in which the sale occurred. Our senior and mezzanine secured credit facilities are secured by our homes in real estate inventory and drawdowns are made on a per-home basis at the time of purchase and are required to be repaid at the time the homes are sold. See “—Liquidity and Capital Resources—Financing Activities.” We define Contribution Margin After Interest as Contribution Profit After Interest as a percentage of revenue.

We view this metric as an important measure of business performance. Contribution Profit After Interest helps management assess Contribution Margin performance, per above, when fully burdened with costs of financing.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 27

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The following table presents a reconciliation of our Adjusted Gross Profit, Contribution Profit and Contribution Profit After Interest to our Gross Profit, which is the most directly comparable GAAP measure, for the periods indicated:

		Three Months Ended June 30,								Six Months Ended June 30,
(in thousands, except percentages and homes sold, unaudited)		2024				2023				2024				2023
Gross profit (GAAP)		$	21,871			$	22,231			$	44,466			$	29,516
Gross margin			8.7	%			9.7	%			8.3	%			3.5	%
Homes sold			742				650				1,589				2,259
Gross profit per home sold		$	29.5			$	34.2			$	28.0			$	13.1
Adjustments:
Real estate inventory valuation adjustment - current period (1)			544				169				683				290
Real estate inventory valuation adjustment - prior period (2)			(540	)			(13,679	)			(701	)			(58,030	)
Interest expense capitalized (3)			1,420				1,358				3,089				6,035
Adjusted gross profit (loss)		$	23,295			$	10,079			$	47,537			$	(22,189	)
Adjusted gross margin			9.3	%			4.4	%			8.9	%			(2.6	)%
Adjustments:
Direct selling costs (4)			(6,461	)			(5,743	)			(13,430	)			(23,804	)
Holding costs on sales - current period (5)(6)			(622	)			(269	)			(1,869	)			(1,811	)
Holding costs on sales - prior period (5)(7)			(443	)			(567	)			(566	)			(2,158	)
Other income, net (8)			615				965				1,369				1,247
Contribution profit (loss)		$	16,384			$	4,465			$	33,041			$	(48,715	)
Contribution margin			6.5	%			1.9	%			6.2	%			(5.8	)%
Homes sold			742				650				1,589				2,259
Contribution profit (loss) per home sold		$	22.1			$	6.9			$	20.8			$	(21.6	)
Adjustments:
Interest expense capitalized (3)			(1,420	)			(1,358	)			(3,089	)			(6,035	)
Interest expense on homes sold - current period (9)			(2,103	)			(1,292	)			(6,313	)			(8,631	)
Interest expense on homes sold - prior period (10)			(2,133	)			(3,709	)			(2,870	)			(13,899	)
Contribution profit (loss) after interest		$	10,728			$	(1,894	)		$	20,769			$	(77,280	)
Contribution margin after interest			4.3	%			(0.8	)%			3.9	%			(9.2	)%
Homes sold			742				650				1,589				2,259
Contribution profit (loss) after interest per home sold		$	14.5			$	(2.9	)		$	13.1			$	(34.2	)

(1)

Real estate inventory valuation adjustment – current period is the real estate inventory valuation adjustments recorded during the period presented associated with homes that remain in real estate inventory at period end.

(2)

Real estate inventory valuation adjustment – prior period is the real estate inventory valuation adjustments recorded in prior periods associated with homes that sold in the period presented.

(3)

Interest expense capitalized represents all interest related costs, including senior and mezzanine secured credit facilities, incurred on homes sold in the period presented that were capitalized and expensed in cost of sales at the time of sale.

(4)

Direct selling costs represents selling costs incurred related to homes sold in the period presented. This primarily includes broker commissions and title and escrow closing fees.

(5)

Holding costs primarily include insurance, utilities, homeowners association dues, property taxes, cleaning, and maintenance costs.

(6)

Represents holding costs incurred on homes sold in the period presented and expensed to Sales, marketing, and operating on the Condensed Consolidated Statements of Operations.

(7)

Represents holding costs incurred in prior periods on homes sold in the period presented and expensed to Sales, marketing, and operating on the Condensed Consolidated Statements of Operations.

(8)

Other income, net principally represents interest income earned on our cash and cash equivalents and fair value adjustments of derivative financial instruments.

(9)

Represents both senior and mezzanine interest expense incurred on homes sold in the period presented and expensed to interest expense on the Condensed Consolidated Statements of Operations.

(10)

Represents both senior and mezzanine secured credit facilities interest expense incurred in prior periods on homes sold in the period presented and expensed to interest expense on the Condensed Consolidated Statements of Operations.

Adjusted Net Income (Loss) and Adjusted EBITDA

We also present Adjusted Net Income (Loss) and Adjusted EBITDA, which are non-GAAP financial measures, which our management team uses to assess our underlying financial performance. We believe these measures provide insight into period over period performance, adjusted for non-recurring or non-cash items.

 

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We calculate Adjusted Net Income (Loss) as GAAP Net Income (Loss) adjusted for the change in fair value of warrant liabilities. We define Adjusted Net Income (Loss) Margin as Adjusted Net Income (Loss) as a percentage of revenue.

We calculate Adjusted EBITDA as Adjusted Net Income (Loss) adjusted for interest expense, amortization of capitalized interest, taxes, depreciation and amortization and stock-based compensation expense. We define Adjusted EBITDA Margin as Adjusted EBITDA as a percentage of revenue.

Adjusted Net Income (Loss) and Adjusted EBITDA are supplemental to our operating performance measures calculated in accordance with GAAP and have important limitations. For example, Adjusted Net Income (Loss) and Adjusted EBITDA exclude the impact of certain costs required to be recorded under GAAP and could differ substantially from similarly titled measures presented by other companies in our industry or companies in other industries. Accordingly, these measures should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP.

The following table presents a reconciliation of our Adjusted Net Income (Loss) and Adjusted EBITDA to our GAAP Net Income (Loss), which is the most directly comparable GAAP measure, for the periods indicated:

		Three Months Ended June 30,								Six Months Ended June 30,
(in thousands, except percentages, unaudited)		2024				2023				2024				2023
Net loss (GAAP)		$	(13,782	)		$	(22,344	)		$	(31,297	)		$	(81,791	)
Change in fair value of warrant liabilities			9				(435	)			(335	)			(46	)
Adjusted net loss		$	(13,773	)		$	(22,779	)		$	(31,632	)		$	(81,837	)
Adjusted net loss margin			(5.5	)%			(9.9	)%			(5.9	)%			(9.7	)%
Adjustments:
Interest expense			4,581				1,867				9,486				9,299
Amortization of capitalized interest (1)			1,420				1,358				3,089				6,035
Income tax (benefit) expense			(54	)			43				69				165
Depreciation and amortization			148				178				314				380
Amortization of stock-based compensation			3,249				2,055				7,116				3,898
Adjusted EBITDA		$	(4,429	)		$	(17,278	)		$	(11,558	)		$	(62,060	)
Adjusted EBITDA margin			(1.8	)%			(7.5	)%			(2.2	)%			(7.4	)%

(1)

Amortization of capitalized interest represents all interest related costs, including senior and mezzanine interest related costs, incurred on homes sold in the period presented that were capitalized and expensed in cost of sales at the time of sale.

Results of Operations

The following details our consolidated results of operations and includes a discussion of our operating results and significant items explaining the material changes in our operating results during the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023.

Three Months Ended June 30, 2024 Compared to Three Months Ended June 30, 2023

		Three Months Ended June 30,
(in thousands, except percentages)		2024				2023				$ Change				% Change
Revenue		$	251,122			$	230,147			$	20,975				9.1	%
Cost of revenue			229,251				207,916				21,335				10.3	%
Gross profit			21,871				22,231				(360	)			(1.6	)%
Operating expenses:
Sales, marketing and operating			20,230				29,040				(8,810	)			(30.3	)%
General and administrative			10,538				12,713				(2,175	)			(17.1	)%
Technology and development			964				2,312				(1,348	)			(58.3	)%
Total operating expenses			31,732				44,065				(12,333	)			(28.0	)%
Loss from operations			(9,861	)			(21,834	)			11,973				(54.8	)%
Other income (expense)
Change in fair value of warrant liabilities			(9	)			435				(444	)			(102.1	)%
Interest expense			(4,581	)			(1,867	)			(2,714	)			145.4	%
Other income, net			615				965				(350	)			(36.3	)%
Total other expense			(3,975	)			(467	)			(3,508	)			751.2	%
Loss before income taxes			(13,836	)			(22,301	)			8,465				(38.0	)%
Income tax benefit (expense)			54				(43	)			97				(225.6	)%
Net loss		$	(13,782	)		$	(22,344	)		$	8,562				(38.3	)%

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 29

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Revenue

Revenue increased by $21.0 million, or 9.1%, to $251.1 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The increase was primarily attributable to higher sales volumes. We sold 742 homes during the three months ended June 30, 2024 compared to 650 homes during the three months ended June 30, 2023, representing an increase of 14.2%. This increase was primarily due to the impact of the considerable softening in consumer demand for residential real estate during the early stages of 2023, causing a significant reduction in home acquisition pace to allow us to manage overall real estate inventory levels. This, in turn, resulted in a lower number of homes sold in the second quarter of 2023 as compared to the second quarter of 2024. The increase in homes sold was partially offset by a decrease in the average resale home price from $357,000 in the three months ended June 30, 2023 to $335,000 in the three months ended June 30, 2024. This decrease was primarily due to our continued increased focus on geographic markets that tend to share relatively lower median price points as higher mortgage interest rates and sustained elevated levels of inflation in the broader economy have continued to negatively impact the residential real estate market conditions. We have also continued to refine our target home purchase price range to focus on acquiring homes with the greatest price stability within each market.

Cost of Revenue and Gross Profit

Cost of revenue increased by $21.3 million, or 10.3%, to $229.3 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. This increase was primarily attributable to higher sales volumes, which was partially offset by a lower average home acquisition price.

Gross profit margin was 8.7% for the three months ended June 30, 2024 compared to 9.7% for the three months ended June 30, 2023. The decrease in gross profit margin was primarily due to the wider than normal underwritten spreads associated with real estate inventory acquired towards the end of 2022 and in the early stages of 2023 in response to the considerable softening in consumer demand for residential real estate. This decrease in gross profit margin was partially offset by an increase in the difference between the average home resale price and the average home acquisition price during the three months ended June 30, 2024 compared to the three months ended June 30, 2023.

Sales, Marketing and Operating

Sales, marketing and operating expense decreased by $8.8 million, or 30.3%, to $20.2 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The decrease in expense was primarily attributable to a $7.4 million decrease in advertising expense as we repositioned and optimized our marketing efforts in response to the ongoing challenging residential real estate market conditions, and decreased average employee headcount. These decreases were partially offset by an increase in variable costs associated with the increase in homes sold.

General and Administrative

General and administrative expense decreased by $2.2 million, or 17.1%, to $10.5 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The decrease in expense was primarily attributable to a decrease in fees associated with our credit facilities and decreased average employee headcount.

Technology and Development

Technology and development expense decreased by $1.3 million, or 58.3%, to $1.0 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The decrease in expense was primarily attributable to decreased average employee headcount.

Change in Fair Value of Warrant Liabilities

Change in fair value of warrant liabilities represents a loss of less than $0.1 million for the three months ended June 30, 2024 and a gain of $0.4 million for the three months ended June 30, 2023, as a result of the fair value adjustment of our warrant liabilities.

Interest Expense

Interest expense increased by $2.7 million, or 145.4%, to $4.6 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The increase in expense was primarily attributable to an increase of $127.8 million in the average outstanding balance of our senior and mezzanine secured credit facilities, from $152.6 million during the three months ended June 30, 2023 to $280.4 million during the three months ended June 30, 2024. The increase was also due to a 0.6% increase in the weighted average variable interest rates associated with these senior and mezzanine secured credit facilities.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 30

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Other Income, Net

Other income, net during the three months ended June 30, 2024 principally represents interest income earned on our cash and cash equivalents. Other income, net during the three months ended June 30, 2023 principally represents interest income earned on our cash and cash equivalents, which was partially offset by the loss that was recorded as a result of the fair value adjustment of the derivative financial instruments that were entered into to manage risks that were principally associated with interest rate fluctuations.

Income Tax Expense

We recorded an income tax benefit of $0.1 million and income tax expense of less than $0.1 million during the three months ended June 30, 2024 and 2023, respectively, and our effective tax rate was a benefit of 0.4% and an expense of 0.2% for the respective periods. Our effective tax rate during the three months ended June 30, 2024 differed from the federal statutory rate of 21% primarily due to net operating loss carryforwards and state taxes.

Six Months Ended June 30, 2024 Compared to Six Months Ended June 30, 2023

		Six Months Ended June 30,
(in thousands, except percentages)		2024				2023				$ Change				% Change
Revenue		$	536,480			$	839,726			$	(303,246	)			(36.1	)%
Cost of revenue			492,014				810,210				(318,196	)			(39.3	)%
Gross profit			44,466				29,516				14,950				50.7	%
Operating expenses:
Sales, marketing and operating			42,682				71,391				(28,709	)			(40.2	)%
General and administrative			22,493				27,192				(4,699	)			(17.3	)%
Technology and development			2,737				4,553				(1,816	)			(39.9	)%
Total operating expenses			67,912				103,136				(35,224	)			(34.2	)%
Loss from operations			(23,446	)			(73,620	)			50,174				(68.2	)%
Other income (expense)
Change in fair value of warrant liabilities			335				46				289				628.3	%
Interest expense			(9,486	)			(9,299	)			(187	)			2.0	%
Other income, net			1,369				1,247				122				9.8	%
Total other expense			(7,782	)			(8,006	)			224				(2.8	)%
Loss before income taxes			(31,228	)			(81,626	)			50,398				(61.7	)%
Income tax expense			(69	)			(165	)			96				(58.2	)%
Net loss		$	(31,297	)		$	(81,791	)		$	50,494				(61.7	)%

Revenue

Revenue decreased by $303.2 million, or 36.1%, to $536.5 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The decrease was primarily attributable to lower sales volumes and a lower average sales price per home. We sold 1,589 homes during the six months ended June 30, 2024 compared to 2,259 during the six months ended June 30, 2023, representing a decrease of 29.7%. Additionally, the average resale home price decreased from $374,000 in the six months ended June 30, 2023 to $333,000 in the six months ended June 30, 2024. During the early stages of 2023, we focused on selling our existing inventory of homes acquired prior to the significant market transition that occurred in the middle of 2022, resulting in a higher number of homes sold during the first half of 2023 as compared to the first half of 2024. This was partially offset by the increase in homes sold in the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The decrease in average sales price per home during the six months ended June 30, 2024 was primarily due to our increased focus on geographic markets that tend to share relatively lower median price points as higher mortgage interest rates and sustained elevated levels of inflation in the broader economy have continued to negatively impact the residential real estate market conditions. We have also continued to refine our target home purchase price range to focus on acquiring homes with the greatest price stability within each market.

Cost of Revenue and Gross Profit

Cost of revenue decreased by $318.2 million, or 39.3%, to $492.0 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. This decrease was primarily attributable to lower sales volumes, a lower average home acquisition price, and a decrease in the real estate inventory valuation adjustment.

Gross profit margin was 8.3% for the six months ended June 30, 2024 compared to 3.5% for the six months ended June 30, 2023. The increase in gross profit margin was primarily due to an increase in the difference between the average home resale price and the average home acquisition price during the six months ended June 30, 2024 compared to the six months ended June 30, 2023, and a $6.3 million decrease in the real estate inventory valuation adjustment during the six months ended

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 31

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June 30, 2024 compared to the six months ended June 30, 2023. These changes were primarily due to our focus on selling our existing inventory of homes acquired prior to the significant market transition that occurred in the middle of 2022 during the early stages of 2023, resulting in a lower gross profit margin during the first half of 2023 as compared to the first half of 2024.

Sales, Marketing and Operating

Sales, marketing and operating expense decreased by $28.7 million, or 40.2%, to $42.7 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The decrease in expense was primarily attributable an $11.0 million decrease in advertising expense as we repositioned and optimized our marketing efforts in response to the ongoing challenging residential real estate market conditions, a decrease in variable costs associated with the decrease in homes sold and decreased average employee headcount.

General and Administrative

General and administrative expense decreased by $4.7 million, or 17.3%, to $22.5 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The decrease in expense was primarily attributable to a decrease in fees associated with our credit facilities and decreased average employee headcount.

Technology and Development

Technology and development expense decreased by $1.8 million, or 39.9%, to $2.7 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The decrease in expense was primarily attributable to decreased average employee headcount.

Change in Fair Value of Warrant Liabilities

Change in fair value of warrant liabilities for the six months ended June 30, 2024 and 2023 represents gains of $0.3 and less than $0.1 million, respectively, as a result of the fair value adjustment of our warrant liabilities.

Interest Expense

Interest expense decreased by $0.2 million, or 2.0%, to $9.5 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The decrease in expense was primarily attributable to a $104.8 million decrease in the average outstanding balance of our senior and mezzanine secured credit facilities, from $386.9 million during the six months ended June 30, 2023 to $282.1 million during the six months ended June 30, 2024. This decrease was partially offset by a 0.8% increase in the weighted average variable interest rates associated with these senior and mezzanine secured credit facilities.

Other Income, Net

Other income, net during the six months ended June 30, 2024 principally represents interest income earned on our cash and cash equivalents. Other income, net during the six months ended June 30, 2023 principally represents interest income earned on our cash and cash equivalents, which was partially offset by the loss that was recorded as a result of the fair value adjustment of the derivative financial instruments that were entered into to manage risks that were principally associated with interest rate fluctuations.

Income Tax Expense

We recorded income tax expense of $0.1 million and $0.2 million during the six months ended June 30, 2024 and 2023, respectively, and our effective tax rate was an expense of 0.2% for each of the respective periods. Our effective tax rate during the six months ended June 30, 2024 differed from the federal statutory rate of 21% primarily due to net operating loss carryforwards and state taxes.

Liquidity and Capital Resources

Overview

Cash and cash equivalents balances consist of operating cash on deposit with financial institutions. Our principal sources of liquidity have historically consisted of cash generated from our operations and financing activities. As of June 30, 2024, we had cash and cash equivalents of $56.9 million and had a total undrawn borrowing capacity under our senior and mezzanine secured credit facilities of $747.1 million, $207.3 million of which is committed and $539.8 million uncommitted.

With the exception of the year ended December 31, 2021, during which we generated net income, we have incurred losses each year from inception and during the three and six months ended June 30, 2024, and may incur additional losses in the future. Since our launch in 2015, we have invested in the development and expansion of our operations. These investments include improvements in infrastructure and a continual improvement to our software and technology platform. We have also invested in sales and marketing as we have increased our market penetration in existing markets, and grown our business through new market expansion and the increased offering of asset-light platform services.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 32

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We expect our working capital requirements to continue to increase over the long term, as we seek to increase our real estate inventory and expand our operations. We believe our cash on hand, together with proceeds from the resale of homes and cash from future borrowings available under each of our existing credit facilities, or the entry into new debt financing arrangements or the issuance of equity instruments, will be sufficient to meet our short-term working capital and capital expenditure requirements for at least the next twelve months. However, our ability to fund our working capital and capital expenditure requirements will depend in part on the residential real estate market conditions in the markets in which we operate and in the U.S. in general, and various other general economic, financial, competitive, legislative, regulatory, geopolitical and other conditions that may be beyond our control. Depending on these and other market conditions, we may seek additional financing. Volatility in the credit markets, rising interest rates and softened consumer demand for residential real estate may have an adverse effect on our ability to obtain debt financing on favorable terms or at all. If we raise additional funds through the issuance of equity, equity-linked or debt securities, those securities may have rights, preferences or privileges senior to the rights of our common stock, or may require us to agree to unfavorable terms, and our existing stockholders may experience significant dilution.

Pre-Funded Warrants

During January 2023, we sold and issued pre-funded warrants to purchase shares of our Class A common stock, resulting in gross proceeds of approximately $90.0 million. The pre-funded warrants became exercisable during March 2023. All of the pre-funded warrants were subsequently exercised during 2023, upon which, 10.7 million shares of our Class A common stock were issued. Participating investors included Brian Bair, our founder, chief executive officer and chairman of our Board; Roberto Sella, a member of our Board; First American Financial Corporation (“First American”), a holder of more than 10% of our outstanding Class A common stock; and Kenneth DeGiorgio, a member of our Board and chief executive officer of First American.

Financing Activities

Our financing activities primarily include borrowing under our senior secured credit facilities, mezzanine secured credit facilities and new issuances of equity (including the issuance of the pre-funded warrants, as discussed above). Historically, we have required access to external financing resources in order to fund growth, increase penetration in existing markets, expansion into new markets and other strategic initiatives, and we expect this to continue in the future. Our access to capital markets can be impacted by factors outside our control, including economic conditions.

Buying and selling high-valued assets, such as single-family residential homes, is very cash intensive and has a significant impact on our liquidity and capital resources. We use non-recourse secured credit facilities, consisting of both senior secured credit facilities and mezzanine secured credit facilities, to finance a significant portion of our real estate inventory and related home renovations. Our senior and mezzanine secured credit facilities, however, are not fully committed, meaning the applicable lender may not be obligated to advance new loan funds if they choose not to do so. Our ability to obtain and maintain access to these or similar kinds of credit facilities is significant for us to operate the business.

Senior Secured Credit Facilities

The following summarizes certain details related to our senior secured credit facilities (in thousands, except interest rates):

	Borrowing Capacity												Outstanding				Weighted- Average Interest				End of Revolving / Withdrawal		Final Maturity
As of June 30, 2024	Committed				Uncommitted				Total				Amount				Rate				Period		Date
Senior financial institution 1	$	150,000			$	250,000			$	400,000			$	112,927				8.13	%		December 2025		June 2026
Senior financial institution 2		100,000				100,000				200,000				54,537				8.07	%		January 2025		July 2025
Senior financial institution 3		100,000				50,000				150,000				59,337				8.58	%		January 2025		April 2025
Related party		30,000				20,000				50,000				10,284				10.33	%		March 2025		September 2025
Senior financial institution 4		30,000				45,000				75,000				19,595				9.83	%		August 2024		February 2025
Senior secured credit facilities	$	410,000			$	465,000			$	875,000			$	256,680

As of June 30, 2024, we had five senior secured credit facilities that we use to fund the purchase of homes and build our real estate inventory, four with separate financial institutions and one with a related party, which holds more than 5% of our Class A common stock. Borrowings under the senior secured credit facilities accrue interest at a rate based on a SOFR reference rate, plus a margin which varies by facility. Each of our senior secured credit facilities also have interest rate floors. We may also pay fees on our senior secured credit facilities, including a commitment fee and fees on certain unused portions of the committed borrowing capacity under the respective credit agreements.

Borrowings under our senior secured credit facilities are collateralized by the real estate inventory financed by the senior secured credit facility. The lenders have legal recourse only to the assets securing the debt and do not have general recourse against us with limited exceptions. We have, however, provided limited non-recourse carve-out guarantees under our senior

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 33

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and mezzanine secured credit facilities for certain of the SPEs’ obligations. Each senior secured credit facility contains eligibility requirements that govern whether a property can be financed. When we resell a home, the proceeds are used to reduce the corresponding outstanding balance under the related senior and mezzanine secured revolving credit facilities.

Mezzanine Secured Credit Facilities

In addition to the senior secured credit facilities, we use mezzanine secured credit facilities which are structurally and contractually subordinated to the related senior secured credit facilities. The following summarizes certain details related to our mezzanine secured credit facilities (in thousands, except interest rates):

	Borrowing Capacity												Outstanding				Weighted- Average Interest				End of Revolving / Withdrawal		Final Maturity
As of June 30, 2024	Committed				Uncommitted				Total				Amount				Rate				Period		Date
Related party facility 1	$	45,000			$	25,000			$	70,000			$	19,111				13.83	%		June 2025		December 2025
Mezzanine financial institution 1		22,500				22,500				45,000				10,714				13.92	%		January 2025		July 2025
Mezzanine financial institution 2		26,667				13,333				40,000				15,850				12.58	%		January 2025		April 2025
Related party facility 2		8,000				14,000				22,000				2,504				13.83	%		March 2025		September 2025
Mezzanine secured credit facilities	$	102,167			$	74,833			$	177,000			$	48,179

As of June 30, 2024, we had four mezzanine secured credit facilities, two with separate financial institutions and two with a related party, which holds more than 5% of our Class A common stock. Borrowings under the mezzanine secured credit facilities accrue interest at a rate based on a SOFR reference rate, plus a margin which varies by facility. Each of our mezzanine secured credit facilities also have interest rate floors. We may also pay fees on our mezzanine secured credit facilities, including a commitment fee and fees on certain unused portions of the committed borrowing capacity under the respective credit agreements.

Borrowings under our mezzanine secured credit facilities are collateralized by a second lien on the real estate inventory financed by the relevant credit facility. The lenders have legal recourse only to the assets securing the debt, and do not have general recourse against us with limited exceptions. When we resell a home, the proceeds are used to reduce the corresponding outstanding balance under the related senior and mezzanine secured revolving credit facilities.

Covenants for Senior Secured Credit Facilities and Mezzanine Secured Credit Facilities

Our secured credit facilities include customary representations and warranties, covenants and events of default. Financed properties are subject to customary eligibility criteria and concentration limits. The terms of these facilities and related financing documents require the Company to comply with a number of customary financial and other covenants, such as maintaining certain levels of liquidity, tangible net worth or leverage (ratio of debt to tangible net worth).

As of June 30, 2024, we were in compliance with all covenants and no event of default had occurred.

Cash Flows

The following summarizes our cash flows for the six months ended June 30, 2024 and 2023:

		Six Months Ended June 30,
($ in thousands)		2024				2023
Net cash (used in) provided by operating activities		$	(51,999	)		$	371,495
Net cash used in investing activities			(318	)			(1,962	)
Net cash provided by (used in) financing activities			45,381				(387,575	)
Net change in cash, cash equivalents and restricted cash		$	(6,936	)		$	(18,042	)

Operating Activities

Net cash (used in) provided by operating activities was ($52.0) million and $371.5 million for the six months ended June 30, 2024 and 2023, respectively. For the six months ended June 30, 2024, net cash used in operating activities primarily resulted from a $32.4 million increase in real estate inventory as a result of home acquisitions increasing at a higher rate compared to sales volumes. Net cash used in operating activities during the six months ended June 30, 2024 was also impacted by the $31.3 million net loss during the period, which included $7.1 million of non-cash stock-based compensation expense.

For the six months ended June 30, 2023, net cash provided by operating activities primarily resulted from a $446.1 million decrease in real estate inventory due to an intentional reduction in real estate inventory levels given the dramatic decline in consumer demand for residential real estate, which began toward the end of the second quarter of 2022 and continued through the first quarter of 2023. During this period of time, we focused on selling our existing real estate inventory of homes acquired in the first half of 2022 and significantly reduced the number of new homes acquired in the second half of 2022 and throughout

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 34

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the first quarter of 2023. Net cash provided by operating activities during the six months ended June 30, 2023 was also impacted by the $81.8 million net loss during the period, which included a $7.5 million non-cash real estate inventory valuation adjustment as a result of the softening consumer demand for residential real estate.

Investing Activities

Net cash used in investing activities was $0.3 million and $2.0 million during the six months ended June 30, 2024 and 2023, respectively. Net cash used in investing activities during the six months ended June 30, 2024 principally represents purchases of property and equipment.

Net cash used in investing activities during the six months ended June 30, 2023 principally represents purchases of derivative instruments.

Financing Activities

Net cash provided by (used in) financing activities was $45.4 million and ($387.6) million during the six months ended June 30, 2024 and 2023, respectively. Net cash provided by financing activities during the six months ended June 30, 2024 primarily consisted of $495.9 million of borrowings from credit facilities and other debt, which was partially offset by $450.5 million of repayments of credit facilities and other debt. This net increase in credit facility funding of $45.4 million was directly related to the increase in financed real estate inventory during the period.

Net cash used in financing activities during the six months ended June 30, 2023 primarily consisted of $889.8 million of repayments of credit facilities and other debt, which was partially offset by $412.0 million of borrowings from credit facilities and other debt. This net decrease in credit facility funding of $477.8 million was directly related to the decrease in financed real estate inventory during the period. This was partially offset by $90.0 million of proceeds from the issuance of pre-funded warrants, net of issuance costs of $0.8 million.

Material Cash Requirements and Other Obligations

Information regarding our material cash requirements and other obligations is provided in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

There have been no material changes in our material cash requirements and other obligations since December 31, 2023 through June 30, 2024.

Critical Accounting Estimates

We prepare our consolidated financial statements in accordance with GAAP. In doing so, we make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenues and expenses during the periods presented. Although we believe our estimates, judgments and assumptions are reasonable, actual results may differ from our estimates under different assumptions, judgments or conditions given the inherent uncertainty involved with such matters, which would impact our financial statements. We base our estimates on historical experience and various other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis.

There have been no material changes to the critical accounting estimates included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Our significant accounting policies and methods used in the preparation of our condensed consolidated financial statements are described in Note 1. Nature of Operations and Significant Accounting Policies in the Notes to Condensed Consolidated Financial Statements in Part I, Item 1, of this Quarterly Report on Form 10-Q and in the Notes to Consolidated Financial Statements in Part II, Item 8, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Recent Accounting Pronouncements

For a discussion of recent accounting pronouncements, refer to Note 1. Nature of Operations and Significant Accounting Policies in the Notes to Condensed Consolidated Financial Statements in Part I, Item 1, of this Quarterly Report on Form 10-Q.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

There have been no material changes to our exposure to market risk since December 31, 2023. For a discussion of our exposure to market risk, refer to our market risk disclosures set forth in Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 35

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Item 4. Controls and Procedures.

Limitations on Effectiveness of Disclosure Controls and Procedures

In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of the disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and our principal financial officer, evaluated, as of the end of the period covered by this Quarterly Report on Form 10-Q, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, our principal executive officer and our principal financial officer have concluded that, as of June 30, 2024, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting, as identified in connection with the evaluation required by Rules 13a-15(e) and 15d-15(e) under the Exchange Act, that occurred during the three months ended June 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 36

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we may become involved in actions, claims, suits and other legal proceedings arising in the ordinary course of our business, including assertions by third parties relating to intellectual property infringement, breaches of contract or warranties or employment-related matters. We are not currently a party to any actions, claims, suits or other legal proceedings the outcome of which, if determined adversely to us, would individually or in the aggregate have a material adverse effect on our business, financial condition, results of operations and cash flows.

The outcome of litigation is inherently uncertain. If one or more legal matters were resolved against us in a reporting period for amounts above management’s expectations, our financial condition, results of operations or cash flows for that reporting period could be adversely impacted, perhaps materially.

Item 1A. Risk Factors.

The Company’s risk factors are described in Part I, Item 1A, “Risk Factors”, of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023. There have been no material changes to the Company’s risk factors since the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Sales of Unregistered Equity Securities

None.

Purchase of Equity Securities

We did not repurchase shares of our Class A common stock during the three months ended June 30, 2024.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

(a) None.

(b) None.

(c) During the three months ended June 30, 2024, no director or “officer” (as defined in Rule 16a-1(f) of the Exchange Act) of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 37

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Item 6. Exhibits.

				Incorporated by Reference
Exhibit Number		Exhibit Description		Form		File No.		Exhibit		Filing Date
3.1		Fourth Restated Certificate of Incorporation, dated June 13, 2023		8-K		001-39641		3.1		6/13/23
3.2		Amended and Restated Bylaws		8-K		001-39641		3.3		6/13/23
10.1		Employment Agreement, effective as of June 5, 2024, by and between Peter Knag and Offerpad Solutions Inc.		8-K		001-39641		10.1		5/23/23
10.2		Form of Amended and Restated Long Term Incentive Award Agreement (under the 2021 Incentive Award Plan)		8-K		001-39641		10.1		6/20/24
10.3*		Amendment Number Four, dated November 28, 2023, to Third Amended and Restated Master Loan and Security Agreement dated as of June 7, 2022, by and among Citibank, N.A., OP SPE Borrower Parent, LLC, OP SPE PHX1, LLC, OP SPE TPA1, LLC and Wells Fargo Bank, N.A
10.4		Amendment Number Five, dated June 28, 2024, to Third Amended and Restated Master Loan and Security Agreement dated as of June 7, 2022, by and among Citibank, N.A., OP SPE Borrower Parent, LLC, OP SPE PHX1, LLC, OP SPE TPA1, LLC and Wells Fargo Bank, N.A.		8-K		001-39641		10.1		7/2/24
31.1*		Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)
31.2*		Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a)
32.1**		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350
32.2**		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350
101*		Inline XBRL Document Set for the condensed consolidated financial statements and accompanying notes in Part I, Item 1. Financial Statements of this Quarterly Report on Form 10-Q
104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Filed herewith.

** Furnished herewith.

 

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 38

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		OFFERPAD SOLUTIONS INC.
Date: August 5, 2024		By:	/s/ Brian Bair
			Brian Bair
			Chief Executive Officer and Chairman of the Board (Principal Executive Officer)
Date: August 5, 2024		By:	/s/ Peter Knag
			Peter Knag
			Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

 

 

Offerpad Solutions Inc. | Second Quarter 2024 Form 10-Q | 39

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Exhibit 10.3

 

AMENDMENT NUMBER FOUR

to the

THIRD AMENDED AND RESTATED MASTER LOAN AND SECURITY AGREEMENT

Dated as of June 7, 2022,

among

OP SPE BORROWER PARENT, LLC,

OP SPE PHX1, LLC,

OP SPE TPA1, LLC,

WELLS FARGO BANK, N.A.

and

CITIBANK, N.A.

 

 

This AMENDMENT NUMBER FOUR (this “Amendment Number Four”) is made this 28th day of November, 2023 (the “Amendment Effective Date”), among OP SPE BORROWER PARENT, LLC (“Parent Borrower”), OP SPE PHX1, LLC and OP SPE TPA1, LLC; (each, a “Borrower” and collectively with Parent Borrower, “Borrowers”) and CITIBANK, N.A. (“Lender”), and acknowledged by WELLS FARGO BANK, N.A. (“Calculation Agent” and “Paying Agent”), to the Third Amended and Restated Master Loan and Security Agreement, dated as of June 7, 2022 (as may be amended, restated, supplemented or otherwise modified from time to time, the “Loan Agreement”), among Borrowers, Lender and Calculation Agent and Paying Agent. Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Loan Agreement.

RECITALS

WHEREAS, Borrowers and Lender have agreed to amend the Loan Agreement as more specifically set forth herein; and

WHEREAS, as of the date hereof, Borrowers represent to Lender that the Relevant Parties are in full compliance with all of the terms and conditions of the Loan Agreement and each other Loan Document and no Default or Event of Default has occurred and is continuing under the Loan Agreement or any other Loan Document.

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and for the mutual covenants herein contained, the parties hereto hereby agree as follows:

Section 1.

Amendment. Effective as of the Amendment Effective Date, Section 7.01(a) of the Loan Agreement is hereby amended by deleting such Section in its entirety and replacing it with the following:

(a) [Reserved];

 

Section 2.

Scrivener’s Error in the Loan Agreement. Pursuant to Amendment Number Two (the “Previous Amendment Number Two”), dated as of October 22, 2021, among Borrowers and Lender, to the Second Amended and Restated Master Loan and Security Agreement, dated as of June 23, 2021, among Borrowers, Lender Calculation Agent and Paying Agent (as amended by the Previous Amendment Number Two and as may be further amended, restated, supplemented or otherwise modified prior to the date hereof, the “Previous Loan Agreement”), Section 7.01 of the Previous Loan Agreement was amended by deleting the covenant set forth in paragraph (a) of such Section 7.01 in its entirety and

125361798V-3

---

 

replacing it with “Reserved”. Borrowers and Lender hereby acknowledge that consistent with the Previous Loan Agreement, Section 7.01(a) of this Loan Agreement was not intended to be included, but due to scrivener’s error, such Section 7.01(a) was re-inserted at the time this Loan Agreement amended and restated the Previous Loan Agreement, and Borrowers were not required to deliver the items specified in such Section 7.01(a) for any calendar quarter that occurred after October 21, 2021. Lender hereby acknowledges that Borrowers are not required to and will not be required to deliver the financial statements referenced in Section 7.01(a) of this Loan Agreement, including, but not limited to the consolidated balance sheets of Guarantor and its consolidated Subsidiaries for each calendar month, the related unaudited consolidated statements of income and retained earnings and of cash flows for Guarantor and its consolidated Subsidiaries for such period or a certificate of a Responsible Office of Guarantor related thereto.

Section 3.

Effectiveness. This Amendment Number Four shall become effective as of the date that Lender shall have received counterparts of this Amendment Number Four duly executed by each of the parties hereto.

Section 4.

Fees and Expenses. Borrowers jointly and severally agree to pay to Lender all reasonable out of pocket costs and expenses incurred by Lender in connection with this Amendment Number Four (including all reasonable fees and out of pocket costs and expenses of Lender’s legal counsel) in accordance with Section 14.03 of the Loan Agreement.

Section 5.

Representations. Borrowers hereby represent to Lender that as of the date hereof, the Relevant Parties are in full compliance with all of the terms and conditions of the Loan Agreement and each other Loan Document and no Default or Event of Default has occurred and is continuing under the Loan Agreement or any other Loan Document.

Section 6.

Binding Effect; Governing Law. This Amendment Number Four shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. THIS AMENDMENT NUMBER FOUR SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF (EXCEPT FOR SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW WHICH SHALL GOVERN).

Section 7.

Counterparts. This Amendment Number Four may be executed by each of the parties hereto on any number of separate counterparts, each of which shall be an original and all of which taken together shall constitute one and the same instrument. The parties agree this Amendment Number Four, any documents to be delivered pursuant to this Amendment Number Four and any notices hereunder may be transmitted between them by e-mail and/or by facsimile. The parties intend that faxed signatures and electronically imaged signatures such as .pdf files and signatures executed using third party electronic signature capture service providers, which comply with the Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act or any other similar state law based on the Uniform Electronic Transactions Act, shall constitute original signatures and are binding on all parties. The original documents shall be promptly delivered, if requested.

Section 8.

Limited Effect. Except as amended hereby, the Loan Agreement shall continue in full force and effect in accordance with its terms. Reference to this Amendment Number Four need not be made in the Loan Agreement or any other instrument or document executed in connection therewith, or in any certificate, letter or communication issued or made pursuant to, or with respect to, the Loan Agreement, any reference in any of such items to the Loan Agreement being sufficient to refer to the Loan Agreement as amended hereby.

125361798V-3

---

 

[Signature Page Follows]

 

125361798V-3

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IN WITNESS WHEREOF, Borrowers and Lender have caused this Amendment Number Four to be executed and delivered by their duly authorized officers as of the Amendment Effective Date.

 

 

OP SPE BORROWER PARENT, LLC,

as Parent Borrower

 

 

By: /s/ Benjamin Aronovitch

Name: Benjamin Aronovitch

Title: Chief Legal Officer

 

 

 

[Amendment Number Four to Third A&R MLSA (Citi-Offerpad) (2023)]

---

 

 

OP SPE PHX1, LLC,

as a Borrower

 

 

By: /s/ Benjamin Aronovitch

Name: Benjamin Aronovitch

Title: Chief Legal Officer

 

[Amendment Number Four to Third A&R MLSA (Citi-Offerpad) (2023)]

---

 

 

OP SPE TPA1, LLC,

as a Borrower

 

 

By: /s/ Benjamin Aronovitch

Name: Benjamin Aronovitch

Title: Chief Legal Officer

 

 

[Amendment Number Four to Third A&R MLSA (Citi-Offerpad) (2023)]

---

 

 

CITIBANK, N.A.,

as Lender

 

 

By: /s/ Arunthathi Theivakumaran

Name: Arunthathi Theivakumaran

Title: Vice President

 

 

[Amendment Number Four to Third A&R MLSA (Citi-Offerpad) (2023)]

---

 

Acknowledged as of the date first above written:

WELLS FARGO BANK, N.A., as Calculation Agent and Paying Agent

By: Computershare Trust Company, N.A., as Agent

By: /s/ Barry Akers .

Name: Barry Akers .

Title: Vice President

 

 

 

[Amendment Number Four to Third A&R MLSA (Citi-Offerpad) (2023)]

---

 

Exhibit 31.1

CERTIFICATION

I, Brian Bair, certify that:

1.

I have reviewed this Quarterly Report on Form 10-Q of Offerpad Solutions Inc.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: August 5, 2024		By:	/s/ Brian Bair
			Brian Bair
			Chief Executive Officer and Chairman of the Board (Principal Executive Officer)

 

 

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Exhibit 31.2

CERTIFICATION

I, Peter Knag, certify that:

1.

I have reviewed this Quarterly Report on Form 10-Q of Offerpad Solutions Inc.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: August 5, 2024		By:	/s/ Peter Knag
			Peter Knag
			Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

 

 

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Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report on Form 10-Q of Offerpad Solutions Inc. (the “Company”) for the period ended June 30, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: August 5, 2024		By:	/s/ Brian Bair
			Brian Bair
			Chief Executive Officer and Chairman of the Board (Principal Executive Officer)

 

 

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Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report on Form 10-Q of Offerpad Solutions Inc. (the “Company”) for the period ended June 30, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: August 5, 2024		By:	/s/ Peter Knag
			Peter Knag
			Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

 

 

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Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2024	Jul. 29, 2024
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2024
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Entity Registrant Name	Offerpad Solutions Inc.
Entity Central Index Key	0001825024
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Title of 12(b) Security	Class A common stock, $0.0001 par value per share
Trading Symbol	OPAD
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Incorporation, State or Country Code	DE
Entity File Number	001-39641
Entity Tax Identification Number	85-2800538
Entity Address, Address Line One	2150 E. Germann Road
Entity Address, Address Line Two	Suite 1
Entity Address, City or Town	Chandler
Entity Address, State or Province	AZ
Entity Address, Postal Zip Code	85286
City Area Code	844
Local Phone Number	388-4539
Document Quarterly Report	true
Document Transition Report	false
Entity Common Stock, Shares Outstanding		27,353,992

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands		Jun. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents		$ 56,906	$ 75,967
Restricted cash		16,092	3,967
Accounts receivable		6,745	9,935
Real estate inventory		307,750	276,500
Prepaid expenses and other current assets		3,545	5,236
Total current assets		391,038	371,605
Property and equipment, net		4,492	4,517
Other non-current assets		11,095	3,572
Total assets	[1]	406,625	379,694
Current liabilities:
Accounts payable		2,838	4,946
Accrued and other current liabilities		13,095	13,859
Secured credit facilities and other debt, net		271,887	227,132
Secured credit facilities and other debt - related party		31,899	30,092
Total current liabilities		319,719	276,029
Warrant liabilities		136	471
Other long-term liabilities		9,203	1,418
Total liabilities	[2]	329,058	277,918
Commitments and contingencies (Note 16)
Stockholders' equity:
Additional paid in capital		506,748	499,660
Accumulated deficit		(429,184)	(397,887)
Total stockholders' equity		77,567	101,776
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		406,625	379,694
Class A Common Stock
Stockholders' equity:
Common stock value		$ 3	$ 3
[1] Our consolidated assets as of June 30, 2024 and December 31, 2023 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $16,092 and $3,867; Accounts receivable, $3,203 and $6,782; Real estate inventory, $307,750 and $276,500; Prepaid expenses and other current assets, $407 and $1,588; Total assets of $327,452 and $288,737, respectively. [2] Our consolidated liabilities as of June 30, 2024 and December 31, 2023 include the following liabilities for which the VIE creditors do not have recourse to Offerpad: Accounts payable, $1,903 and $1,798; Accrued and other current liabilities, $1,757 and $2,027; Secured credit facilities and other debt, net, $303,786 and $257,224; Total liabilities, $307,446 and $261,049, respectively.

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands		Jun. 30, 2024	Dec. 31, 2023
Restricted cash		$ 16,092	$ 3,967
Accounts receivable		6,745	9,935
Real estate inventory		307,750	276,500
Prepaid expenses and other current assets		3,545	5,236
Property and equipment, net		4,492	4,517
Total assets	[1]	406,625	379,694
Accounts payable		2,838	4,946
Accrued and other current liabilities		13,095	13,859
Secured credit facilities and notes payable		271,887	227,132
Total liabilities	[2]	329,058	277,918
Variable Interest Entity [Member]
Accounts receivable		3,203	6,782
Real estate inventory		307,750	276,500
Prepaid expenses and other current assets		407	1,588
Total assets		327,452	288,737
Accounts payable		1,903	1,798
Accrued and other current liabilities		1,757	2,027
Total liabilities		$ 307,446	$ 261,049
Class A Common Stock
Common stock, par value		$ 0.0001	$ 0.0001
Common stock, shares authorized		2,000,000,000	2,000,000,000
Common stock, shares issued		27,329,264	27,233,000
Common stock, shares outstanding		27,329,264	27,233,000
[1] Our consolidated assets as of June 30, 2024 and December 31, 2023 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $16,092 and $3,867; Accounts receivable, $3,203 and $6,782; Real estate inventory, $307,750 and $276,500; Prepaid expenses and other current assets, $407 and $1,588; Total assets of $327,452 and $288,737, respectively. [2] Our consolidated liabilities as of June 30, 2024 and December 31, 2023 include the following liabilities for which the VIE creditors do not have recourse to Offerpad: Accounts payable, $1,903 and $1,798; Accrued and other current liabilities, $1,757 and $2,027; Secured credit facilities and other debt, net, $303,786 and $257,224; Total liabilities, $307,446 and $261,049, respectively.

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Statement [Abstract]
Revenue	$ 251,122	$ 230,147	$ 536,480	$ 839,726
Cost of revenue	229,251	207,916	492,014	810,210
Gross profit	21,871	22,231	44,466	29,516
Operating expenses:
Sales, marketing and operating	20,230	29,040	42,682	71,391
General and administrative	10,538	12,713	22,493	27,192
Technology and development	964	2,312	2,737	4,553
Total operating expenses	31,732	44,065	67,912	103,136
Loss from operations	(9,861)	(21,834)	(23,446)	(73,620)
Other income (expense):
Change in fair value of warrant liabilities	(9)	435	335	46
Interest expense	(4,581)	(1,867)	(9,486)	(9,299)
Other income, net	615	965	1,369	1,247
Total other expense	(3,975)	(467)	(7,782)	(8,006)
Loss before income taxes	(13,836)	(22,301)	(31,228)	(81,626)
Income tax benefit (expense)	54	(43)	(69)	(165)
Net loss	$ (13,782)	$ (22,344)	$ (31,297)	$ (81,791)
Net loss per share, basic	$ (0.5)	$ (0.82)	$ (1.14)	$ (3.21)
Net loss per share, diluted	$ (0.5)	$ (0.82)	$ (1.14)	$ (3.21)
Weighted average common shares outstanding, basic	27,385	27,258	27,362	25,470
Weighted average common shares outstanding, diluted	27,385	27,258	27,362	25,470

Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit
Beginning balance at Dec. 31, 2022	$ 121,877	$ 2	$ 402,544	$ (280,669)
Beginning balance, shares at Dec. 31, 2022		16,479
Issuance of common stock upon exercise of stock options	53		53
Issuance of common stock upon exercise of stock options, shares		14
Issuance of common stock upon early exercise of stock options, shares		17
Issuance of common stock upon vesting of restricted stock units	(53)		(53)
Issuance of pre-funded warrants, net	89,216		89,216
Exercise of pre-funded warrants	11	$ 1	10
Exercise of pre-funded warrants, shares		10,715
Stock-based compensation expense	3,898		3,898
Net loss	(81,791)			(81,791)
Ending balance at Jun. 30, 2023	133,211	$ 3	495,668	(362,460)
Ending balance, shares at Jun. 30, 2023		27,225
Beginning balance at Mar. 31, 2023	153,501	$ 3	493,614	(340,116)
Beginning balance, shares at Mar. 31, 2023		26,507
Issuance of common stock upon exercise of stock options	4		4
Issuance of common stock upon exercise of stock options, shares		1
Issuance of common stock upon vesting of restricted stock units	(5)		(5)
Issuance of common stock upon vesting of restricted stock units, shares		3
Exercise of pre-funded warrants, shares		714
Stock-based compensation expense	2,055		2,055
Net loss	(22,344)			(22,344)
Ending balance at Jun. 30, 2023	133,211	$ 3	495,668	(362,460)
Ending balance, shares at Jun. 30, 2023		27,225
Beginning balance at Dec. 31, 2023	101,776	$ 3	499,660	(397,887)
Beginning balance, shares at Dec. 31, 2023		27,233
Issuance of common stock upon exercise of stock options	16		16
Issuance of common stock upon exercise of stock options, shares		5
Issuance of common stock upon early exercise of stock options, shares		91
Issuance of common stock upon vesting of restricted stock units	(44)		(44)
Stock-based compensation expense	7,116		7,116
Net loss	(31,297)			(31,297)
Ending balance at Jun. 30, 2024	77,567	$ 3	506,748	(429,184)
Ending balance, shares at Jun. 30, 2024		27,329
Beginning balance at Mar. 31, 2024	88,101	$ 3	503,500	(415,402)
Beginning balance, shares at Mar. 31, 2024		27,300
Issuance of common stock upon vesting of restricted stock units	(1)		(1)
Issuance of common stock upon vesting of restricted stock units, shares		29
Stock-based compensation expense	3,249		3,249
Net loss	(13,782)			(13,782)
Ending balance at Jun. 30, 2024	$ 77,567	$ 3	$ 506,748	$ (429,184)
Ending balance, shares at Jun. 30, 2024		27,329

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Cash flows from operating activities:
Net loss	$ (31,297)	$ (81,791)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation	314	380
Amortization of debt financing costs	1,153	1,980
Real estate inventory valuation adjustment	1,168	7,454
Stock-based compensation	7,116	3,898
Change in fair value of warrant liabilities	(335)	(46)
Change in fair value of derivative instrument	0	715
Loss on disposal of property and equipment	29	30
Changes in operating assets and liabilities:
Accounts receivable	3,190	871
Real estate inventory	(32,418)	446,124
Prepaid expenses and other assets	2,091	313
Accounts payable	(2,108)	1,693
Accrued and other liabilities	(902)	(10,126)
Net cash (used in) provided by operating activities	(51,999)	371,495
Cash flows from investing activities:
Purchases of property and equipment	(362)	(90)
Proceeds from sales of property and equipment	44	0
Purchase of derivative instrument	0	(1,872)
Net cash used in investing activities	(318)	(1,962)
Cash flows from financing activities:
Borrowings from credit facilities and other debt	495,955	411,990
Repayments of credit facilities and other debt	(450,546)	(889,773)
Payment of debt financing costs	0	(172)
Proceeds from exercise of stock options	16	53
Payments for taxes related to stock-based awards	(44)	(52)
Borrowings from warehouse lending facility	0	18,488
Repayments of warehouse lending facility	0	(17,336)
Proceeds from issuance of pre-funded warrants	0	90,000
Proceeds from exercise of pre-funded warrants	0	11
Issuance cost of pre-funded warrants	0	(784)
Net cash provided by (used in) financing activities	45,381	(387,575)
Net change in cash, cash equivalents and restricted cash	(6,936)	(18,042)
Cash, cash equivalents and restricted cash, beginning of period	79,934	140,299
Cash, cash equivalents and restricted cash, end of period	72,998	122,257
Reconciliation of cash, cash equivalents and restricted cash to the condensed consolidated balance sheet:
Cash and cash equivalents	56,906	115,599
Restricted Cash	16,092	6,658
Total cash, cash equivalents and restricted cash	72,998	122,257
Supplemental disclosure of cash flow information:
Cash payments for interest	$ 12,624	$ 13,932

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (13,782)	$ (22,344)	$ (31,297)	$ (81,791)

Insider Trading Arrangements	3 Months Ended
	Jun. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Nature of Operations and Significant Accounting Policies	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Nature of Operations and Significant Accounting Policies	Note 1. Nature of Operations and Significant Accounting Policies Description of Business Offerpad, dedicated to simplifying the process of buying and selling homes, is committed to providing comprehensive solutions that remove the friction from real estate. Our advanced real estate platform offers a range of services, from consumer cash offers to B2B renovation solutions and industry partnership programs, all tailored to meet the unique needs of our clients. Since 2015, we’ve leveraged local expertise in residential real estate alongside proprietary technology to guide homeowners at every step. The Company is currently headquartered in Chandler, Arizona and operates in over 1,800 cities and towns in 27 metropolitan markets across 17 states as of June 30, 2024. Basis of Presentation and Interim Financial Information The accompanying unaudited interim condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to GAAP and SEC rules and regulations. Accordingly, the unaudited interim condensed consolidated financial statements do not include all of the information and note disclosures required by GAAP for complete financial statements. Therefore, this information should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s audited consolidated financial statements as of and for the year ended December 31, 2023 included in the Company’s 2023 Annual Report on Form 10-K as filed with the SEC on February 27, 2024. The accompanying financial information reflects all adjustments which are, in the opinion of the Company’s management, of a normal recurring nature and necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim periods. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). Reverse Stock Split On June 12, 2023, the Company filed a certificate of amendment to its Third Restated Certificate of Incorporation (as amended from time to time, the “Certificate of Incorporation”) with the Secretary of State of the State of Delaware to effect a 1-for-15 reverse stock split (the “Reverse Stock Split”). The Company’s Class A common stock began trading on a split-adjusted basis at market open on June 13, 2023 under the existing symbol “OPAD”. Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements. Significant estimates include those related to the net realizable value of real estate inventory, among others. Actual results could differ from those estimates. Principles of Consolidation The Company’s condensed consolidated financial statements include the assets, liabilities, revenues and expenses of the Company, its wholly-owned operating subsidiaries and variable interest entities where the Company is the primary beneficiary. All intercompany accounts and transactions have been eliminated in consolidation. Real Estate Inventory Real estate inventory consists of acquired homes and is stated at the lower of cost or net realizable value, with cost and net realizable value determined by the specific identification of each home. Costs include initial purchase costs and renovation costs, as well as holding costs and interest incurred during the renovation period, prior to the listing date. Selling costs, including commissions and holding costs incurred after the listing date, are expensed as incurred and included in sales, marketing and operating expenses. The Company reviews real estate inventory for valuation adjustments on a quarterly basis, or more frequently if events or changes in circumstances indicate that the carrying value of real estate inventory may not be recoverable. The Company evaluates real estate inventory for indicators that net realizable value is lower than cost at the individual home level. The Company generally considers multiple factors in determining net realizable value for each home, including recent comparable home sale transactions in the specific area where the home is located, the residential real estate market conditions in both the local market in which the home is located and in the U.S. in general, the impact of national, regional or local economic conditions and expected selling costs. When evidence exists that the net realizable value of real estate inventory is lower than its cost, the difference is recognized as a real estate inventory valuation adjustment in cost of revenue and the related real estate inventory is adjusted to its net realizable value. For individual homes or portfolios of homes under contract to sell as of the real estate inventory valuation assessment date, if the carrying value exceeds the contract price less expected selling costs, the carrying value of these homes are adjusted to the contract price less expected selling costs. For all other homes, if the carrying value exceeds the expected sale price less expected selling costs, the carrying value of these homes are adjusted to the expected sale price less expected selling costs. Changes in the Company’s pricing assumptions may lead to a change in the outcome of the real estate inventory valuation analysis, and actual results may differ from the Company’s assumptions. The Company recorded real estate inventory valuation adjustments of $0.6 million and $0.2 million during the three months ended June 30, 2024 and 2023, respectively, and $1.2 million and $7.5 million during the six months ended June 30, 2024 and 2023, respectively. Refer to Note 2. Real Estate Inventory, for further details. Recent Accounting Standards Income Tax Disclosures In December 2023, the FASB issued a new standard which is intended to improve an entity’s income tax disclosures, primarily through disaggregated information about an entity’s effective income tax rate reconciliation and additional disclosures about income taxes paid. The new standard is effective for annual periods beginning after December 15, 2024. Accordingly, the new standard is effective for the Company on January 1, 2025 on a prospective basis. The Company is currently evaluating the impact that the standard will have on its condensed consolidated financial statements. Segment Reporting In November 2023, the FASB issued a new standard which is intended to improve disclosures about an entity’s reportable segments, primarily through enhanced disclosures about significant segment expenses. The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. Accordingly, the new standard is effective for the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and subsequent interim periods, using a retrospective approach. The Company is currently evaluating the impact that the standard will have on its condensed consolidated financial statements.

Real Estate Inventory	6 Months Ended
	Jun. 30, 2024
Inventory Disclosure [Abstract]
Real Estate Inventory	Note 2. Real Estate Inventory The components of real estate inventory, net of applicable lower of cost or net realizable value adjustments, consist of the following as of the respective period ends:     June 30,     December 31,   ($ in thousands)   2024     2023   Homes preparing for and under renovation   $ 87,383     $ 53,116   Homes listed for sale     158,953       148,648   Homes under contract to sell     61,414       74,736   Real estate inventory   $ 307,750     $ 276,500

Derivative Financial Instruments	6 Months Ended
	Jun. 30, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Financial Instruments	Note 3. Derivative Financial Instruments During 2023, the Company entered into derivative arrangements pursuant to which the Company acquired options on U.S. Treasury futures. These options provided the Company with the right, but not the obligation, to purchase U.S. Treasury futures at a predetermined notional amount and stated term in the future. During the six months ended June 30, 2023, the Company purchased $1.9 million of derivative instruments. During the three and six months ended June 30, 2023, the Company recorded changes in the fair value of the derivative instruments of ($0.1) million and ($0.7) million, respectively, in Other income, net in the condensed consolidated statements of operations. The Company sold all of its outstanding derivative arrangements during October 2023 and no derivative arrangements remain outstanding.

Property and Equipment	6 Months Ended
	Jun. 30, 2024
Property, Plant and Equipment [Abstract]
Property and Equipment	Note 4. Property and Equipment Property and equipment consist of the following as of the respective period ends:     June 30,     December 31,   ($ in thousands)   2024     2023   Rooftop solar panel systems   $ 4,999     $ 5,075   Leasehold improvements     1,071       1,130   Office equipment and furniture     833       837   Software systems     386       386   Computers and equipment     265       265   Construction in progress     394       32   Property and equipment, gross     7,948       7,725   Less: accumulated depreciation     (3,456 )     (3,208 ) Property and equipment, net   $ 4,492     $ 4,517   Depreciation expense was $0.1 million and $0.2 million during the three months ended June 30, 2024 and 2023, respectively, and $0.3 million and $0.4 million during the six months ended June 30, 2024 and 2023, respectively.

Leases	6 Months Ended
	Jun. 30, 2024
Leases [Abstract]
Leases	Note 5. Leases The Company’s operating lease arrangements consist of its existing corporate headquarters in Chandler, Arizona, its future corporate headquarters in Tempe, Arizona, and field office facilities in most of the metropolitan markets in which the Company operates in the United States. These leases typically have original lease terms of 1 year to 10 years, and some leases contain multiyear renewal options. The Company does not have any finance lease arrangements. The Company’s operating lease costs are included in operating expenses in the accompanying condensed consolidated statements of operations. During the three months ended June 30, 2024 and 2023, operating lease costs were $0.9 million and $0.6 million, respectively, and variable and short-term lease costs were less than $0.1 million during each of the respective periods. During the six months ended June 30, 2024 and 2023, operating lease costs were $1.8 million and $1.2 million, respectively, and variable and short-term lease costs were less than $0.1 million during each of the respective periods. Cash payments for amounts included in the measurement of operating lease liabilities were $0.6 million during each of the three months ended June 30, 2024 and 2023, and $0.9 million and $1.2 million during the six months ended June 30, 2024 and 2023, respectively. There were no right-of-use assets obtained in exchange for new or acquired operating lease liabilities during three months ended June 30, 2024. Right-of-use assets obtained in exchange for new or acquired operating lease liabilities were $7.9 million during the six months ended June 30, 2024. There were no right-of-use assets obtained in exchange for new or acquired operating lease liabilities during both of the three and six months ended June 30, 2023. As of June 30, 2024 and December 31, 2023, the Company’s operating leases had a weighted-average remaining lease term of 8.8 years and 1.8 years, respectively, and a weighted-average discount rate of 7.1% and 4.3%, respectively. The Company’s operating lease liability maturities as of June 30, 2024 are as follows: ($ in thousands)       Remainder of 2024   $ 1,165   2025     2,898   2026     2,089   2027     1,949   2028     1,922   2029     1,974   Thereafter     11,862   Total future lease payments     23,859   Less: Imputed interest     (7,105 ) Less: Tenant incentive receivable     (5,532 ) Total lease liabilities   $ 11,222     The Company’s operating lease right-of-use assets and operating lease liabilities, and the associated financial statement line items, are as follows as of the respective period ends:         June 30,     December 31,   ($ in thousands)   Financial Statement Line Items   2024     2023   Right-of-use assets   Other non-current assets   $ 9,934     $ 3,338   Lease liabilities:                 Current liabilities   Accrued and other current liabilities     2,019       2,271   Non-current liabilities   Other long-term liabilities     9,203       1,418   Total lease liabilities       $ 11,222     $ 3,689

Accrued and Other Liabilities	6 Months Ended
	Jun. 30, 2024
Payables and Accruals [Abstract]
Accrued and Other Liabilities	Note 6. Accrued and Other Liabilities Accrued and other current liabilities consist of the following as of the respective period ends:     June 30,     December 31,   ($ in thousands)   2024     2023   Home renovation   $ 3,318     $ 3,534   Payroll and other employee related expenses     2,352       3,200   Operating lease liabilities     2,019       2,271   Marketing     1,894       999   Interest     1,729       1,989   Legal and professional obligations     604       392   Other     1,179       1,474   Accrued and other current liabilities   $ 13,095     $ 13,859     The Company incurred advertising expenses of $3.5 million and $10.9 million during the three months ended June 30, 2024 and 2023, respectively, and $7.9 million and $18.9 million during the six months ended June 30, 2024 and 2023, respectively. Other long-term liabilities consists of the non-current portion of our operating lease liabilities as of June 30, 2024 and December 31, 2023.

Credit Facilities and Other Debt	6 Months Ended
	Jun. 30, 2024
Debt Disclosure [Abstract]
Credit Facilities and Other Debt	Note 7. Credit Facilities and Other Debt The carrying value of the Company’s credit facilities and other debt consists of the following as of the respective period ends:   June 30,     December 31,   ($ in thousands) 2024     2023   Credit facilities and other debt, net           Senior secured credit facilities with financial institutions $ 246,396     $ 216,654   Senior secured credit facility with a related party   10,284       6,289   Mezzanine secured credit facilities with financial institutions   26,564       12,704   Mezzanine secured credit facilities with a related party   21,615       23,803   Debt issuance costs   (1,073 )     (2,226 ) Total credit facilities and other debt, net   303,786       257,224   Current portion - credit facilities and other debt, net           Total credit facilities and other debt, net   271,887       227,132   Total credit facilities and other debt - related party   31,899       30,092   Total credit facilities and other debt, net $ 303,786     $ 257,224   The Company utilizes inventory financing facilities consisting of senior secured credit facilities, mezzanine secured credit facilities and other senior secured borrowing arrangements to provide financing for the Company’s real estate inventory purchases and renovation. Borrowings under the Company’s credit facilities and other debt are classified as current liabilities on the accompanying condensed consolidated balance sheets as amounts drawn to purchase and renovate homes are required to be repaid as the related real estate inventory is sold, which is expected to be within 12 months. As of June 30, 2024, the Company had a total borrowing capacity of $1,052.0 million under its senior secured credit facilities and mezzanine secured credit facilities, of which $512.2 million was committed. Any borrowings above the committed amounts are subject to the applicable lender’s discretion. Under the Company’s senior secured credit facilities and mezzanine secured credit facilities, amounts can be borrowed, repaid and borrowed again during the revolving period. The borrowing capacity is generally available until the end of the applicable revolving period as reflected in the tables below. Outstanding amounts drawn under each senior secured credit facility and mezzanine secured credit facility are required to be repaid on the facility maturity date or earlier if accelerated due to an event of default or other mandatory repayment event. The Company’s senior secured credit facilities and mezzanine secured credit facilities have aggregated borrowing bases, which increase or decrease based on the cost and value of the properties financed under a given facility and the time that those properties are in the Company’s possession. When the Company resells a home, the proceeds are used to reduce the corresponding outstanding balance under the related senior and mezzanine secured revolving credit facilities. The borrowing base for a given facility may be reduced as properties age beyond certain thresholds or the performance of the properties financed under that facility declines, and any borrowing base deficiencies may be satisfied through contributions of additional properties or partial repayment of the facility. Senior Secured Credit Facilities The following summarizes certain details related to the Company’s senior secured credit facilities (in thousands, except interest rates):   Borrowing Capacity   Outstanding   Weighted- Average Interest   End of Revolving / Withdrawal   Final Maturity As of June 30, 2024 Committed   Uncommitted   Total   Amount   Rate   Period   Date Senior financial institution 1 $150,000   $250,000   $400,000   $112,927   8.13%   December 2025   June 2026 Senior financial institution 2 100,000   100,000   200,000   54,537   8.07%   January 2025   July 2025 Senior financial institution 3 100,000   50,000   150,000   59,337   8.58%   January 2025   April 2025 Related party 30,000   20,000   50,000   10,284   10.33%   March 2025   September 2025 Senior financial institution 4 30,000   45,000   75,000   19,595   9.83%   August 2024   February 2025 Senior secured credit facilities $410,000   $465,000   $875,000   $256,680                 Borrowing Capacity     Outstanding     Weighted- Average Interest           As of December 31, 2023 Committed     Uncommitted     Total     Amount     Rate           Senior financial institution 1 $ 200,000     $ 200,000     $ 400,000     $ 135,676       7.91 %         Senior financial institution 2   100,000       100,000       200,000       55,541       7.61 %         Senior financial institution 3   100,000       50,000       150,000       6,453       7.11 %         Related party   30,000       20,000       50,000       6,289       10.05 %         Senior financial institution 4   30,000       45,000       75,000       18,984       8.42 %         Senior secured credit facilities $ 460,000     $ 415,000     $ 875,000     $ 222,943                 As of June 30, 2024, the Company had five senior secured credit facilities, four with separate financial institutions and one with a related party, which holds more than 5% of our Class A common stock. Borrowings under the senior secured credit facilities accrue interest at a rate based on a Secured Overnight Financing Rate (“SOFR”) reference rate, plus a margin which varies by facility. Each of the Company’s senior secured credit facilities also have interest rate floors. The Company may also pay fees on its senior secured credit facilities, including a commitment fee and fees on certain unused portions of the committed borrowing capacity under the respective credit agreements. Borrowings under the Company’s senior secured credit facilities are collateralized by the real estate inventory financed by the senior secured credit facility. The lenders have legal recourse only to the assets securing the debt and do not have general recourse against the Company with limited exceptions. The Company has, however, provided limited non-recourse carve-out guarantees under its senior and mezzanine secured credit facilities for certain of the SPEs’ obligations. Each senior secured credit facility contains eligibility requirements that govern whether a property can be financed. Mezzanine Secured Credit Facilities The following summarizes certain details related to the Company’s mezzanine secured credit facilities (in thousands, except interest rates):   Borrowing Capacity   Outstanding   Weighted- Average Interest   End of Revolving / Withdrawal   Final Maturity As of June 30, 2024 Committed   Uncommitted   Total   Amount   Rate   Period   Date Related party facility 1 $45,000   $25,000   $70,000   $19,111   13.83%   June 2025   December 2025 Mezzanine financial institution 1 22,500   22,500   45,000   10,714   13.92%   January 2025   July 2025 Mezzanine financial institution 2 26,667   13,333   40,000   15,850   12.58%   January 2025   April 2025 Related party facility 2 8,000   14,000   22,000   2,504   13.83%   March 2025   September 2025 Mezzanine secured credit facilities $102,167   $74,833   $177,000   $48,179                 Borrowing Capacity   Outstanding   Weighted- Average Interest         As of December 31, 2023 Committed   Uncommitted   Total   Amount   Rate         Related party facility 1 $45,000   $25,000   $70,000   $22,250   11.56%         Mezzanine financial institution 1 22,500   22,500   45,000   11,198   12.79%         Mezzanine financial institution 2 26,667   13,333   40,000   1,506   9.55%         Related party facility 2 8,000   14,000   22,000   1,553   13.05%         Mezzanine secured credit facilities $102,167   $74,833   $177,000   $36,507             As of June 30, 2024, the Company had four mezzanine secured credit facilities, two with separate financial institutions and two with a related party, which holds more than 5% of our Class A common stock. Borrowings under the Company’s mezzanine secured credit facilities accrue interest at a rate based on a SOFR reference rate, plus a margin which varies by facility. Each of the Company’s mezzanine secured credit facilities also have interest rate floors. The Company may also pay fees on its mezzanine secured credit facilities, including a commitment fee and fees on certain unused portions of the committed borrowing capacity under the respective credit agreements. Borrowings under the Company’s mezzanine secured credit facilities are collateralized by a second lien on the real estate inventory financed by the relevant credit facility. The lenders have legal recourse only to the assets securing the debt, and do not have general recourse to Offerpad with limited exceptions. The Company’s mezzanine secured credit facilities are structurally and contractually subordinated to the related senior secured credit facilities. Maturities Certain of the Company’s secured credit facilities mature within the next twelve months following the date these condensed consolidated financial statements are issued. The Company expects to enter into new financing arrangements or amend existing arrangements to meet its obligations as they come due, which the Company believes is probable based on its history of prior credit facility renewals. The Company believes cash on hand, together with proceeds from the resale of homes and cash from future borrowings available under each of the Company’s existing credit facilities or the entry into new financing arrangements, will be sufficient to meet its obligations as they become due in the ordinary course of business for at least 12 months following the date these condensed consolidated financial statements are issued. Covenants for Senior Secured Credit Facilities and Mezzanine Secured Credit Facilities The Company’s secured credit facilities include customary representations and warranties, covenants and events of default. Financed properties are subject to customary eligibility criteria and concentration limits. The terms of these facilities and related financing documents require the Company to comply with a number of customary financial and other covenants, such as maintaining certain levels of liquidity, tangible net worth or leverage (ratio of debt to tangible net worth). As of June 30, 2024, the Company was in compliance with all covenants and no event of default had occurred.

Warrant Liabilities	6 Months Ended
	Jun. 30, 2024
Other Liabilities Disclosure [Abstract]
Warrant Liabilities	Note 8. Warrant Liabilities As of June 30, 2024, the Company had 16.1 million public warrants outstanding and 5.7 million private placement warrants outstanding, with every 15 warrants being exercisable to purchase one share of Class A common stock at an exercise price of $172.50 per share. Public Warrants The public warrants became exercisable on October 23, 2021. A holder may exercise its warrants only for a whole number of shares of Class A common stock. The public warrants will expire September 1, 2026, or earlier upon redemption or liquidation. Pursuant to the terms of the warrant agreements, the Company may call the public warrants for redemption for cash or redeem the outstanding warrants for shares of Class A common stock under certain scenarios. The public warrants are traded on an over-the-counter market. Private Placement Warrants The private placement warrants have terms and provisions that are substantially identical to those of the public warrants, with the exception of certain redemption rights, options to exercise and registration rights when the private placement warrants are owned by specified holders.

Fair Value Measurements	6 Months Ended
	Jun. 30, 2024
Fair Value Disclosures [Abstract]
Fair Value Measurements	Note 9. Fair Value Measurements The fair values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and certain prepaid and other current assets and accrued expenses approximate carrying values because of their short-term nature. The Company’s credit facilities are carried at amortized cost and the carrying value approximates fair value because of their short-term nature. The Company’s liabilities that are measured at fair value on a recurring basis consist of the following (in thousands): As of June 30, 2024   Quoted Prices in Active Markets for Identical Liabilities (Level 1)     Significant Other Observable Inputs (Level 2)     Significant Unobservable Inputs (Level 3)   Public warrant liabilities   $ 58     $ —     $ —   Private placement warrant liabilities   $ —     $ —     $ 78   As of December 31, 2023   Quoted Prices in Active Markets for Identical Liabilities (Level 1)     Significant Other Observable Inputs (Level 2)     Significant Unobservable Inputs (Level 3)   Public warrant liabilities   $ 305     $ —     $ —   Private placement warrant liabilities   $ —     $ —     $ 166   Public Warrants The public warrants are traded on an over-the-counter market. The fair value of the public warrants is estimated based on the quoted market price of such warrants on the valuation date. The Company recorded changes in the fair value of the public warrants of less than $0.1 million and $(0.3) million during the three months ended June 30, 2024 and 2023, respectively, and $(0.3) million and $(0.02) million during the six months ended June 30, 2024 and 2023, respectively. These changes are recorded in Change in fair value of warrant liabilities in our condensed consolidated statements of operations. Private Placement Warrants The following summarizes the changes in the Company’s private placement warrant liabilities, which are measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the respective periods:     Three Months Ended June 30,     Six Months Ended June 30,   ($ in thousands)   2024     2023     2024     2023   Beginning balance   $ 75     $ 285   $ 166     $ 196   Change in fair value of private placement warrants included in net loss     3       (114 )     (88 )     (25 ) Ending balance   $ 78     $ 171     $ 78     $ 171     The Company generally uses the Black-Scholes-Merton option-pricing model to determine the fair value of the private placement warrants, with assumptions including expected volatility, expected life of the warrants, associated risk-free interest rate, and expected dividend yield. There were no transfers between Levels 1, 2, and 3 during the three and six months ended June 30, 2024 and 2023.

Stockholders' Equity	6 Months Ended
	Jun. 30, 2024
Stockholders' Equity Note [Abstract]
Stockholders' Equity	Note 10. Stockholders’ Equity Authorized Capital Stock The Company’s is authorized to issue 2,100,000,000 shares of capital stock, which consists of 2,000,000,000 shares of Class A common stock and 100,000,000 shares of preferred stock, both of which have a par value $0.0001 per share. Class A Common Stock Our Class A common stock trades on the New York Stock Exchange under the symbol “OPAD” and our public warrants trade on the OTC Markets Group Pink Market under the symbol “OPADW.” As of June 30, 2024, we had 27,329,264 shares of Class A common stock issued and outstanding. We also have outstanding private placement warrants to purchase shares of our Class A common stock. Refer to Note 8. Warrant Liabilities. During January 2023, we sold and issued pre-funded warrants to purchase shares of our Class A common stock, resulting in gross proceeds of approximately $90.0 million. The pre-funded warrants became exercisable during March 2023. All of the pre-funded warrants were subsequently exercised during 2023, upon which, 10.7 million shares of our Class A common stock were issued. Preferred Stock As of June 30, 2024, there were no shares of preferred stock issued and outstanding. Dividends Our Class A common stock is entitled to dividends if and when any dividend is declared by our Board, subject to the rights of all classes of stock outstanding having priority rights to dividends. We have not paid any cash dividends on common stock to date. We may retain future earnings, if any, for the further development and expansion of our business and have no current plans to pay cash dividends for the foreseeable future. Any future determination to pay dividends will be made at the discretion of our Board and will depend on, among other things, our financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as our Board may deem relevant.

Stock-Based Awards	6 Months Ended
	Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]
Stock-Based Awards	Note 11. Stock-Based Awards 2021 Equity Incentive Plans Incentive Award Plan As of December 31, 2023, there were 1,755,548 shares of Class A common stock reserved for issuance under the Offerpad Solutions Inc. 2021 Incentive Award Plan (the “2021 Plan”). Pursuant to the terms of the 2021 Plan, the number of shares of the Company’s Class A common stock available for issuance under the 2021 Plan automatically increased by 122,360 shares of Class A common stock on January 1, 2024. Following this increase, there were 1,877,908 shares reserved for issuance under the 2021 Plan as of June 30, 2024. As of June 30, 2024, the Company has granted stock options, restricted stock units (“RSUs”), performance-based RSUs (“PSUs”) and other stock or cash-based awards under the 2021 Plan. Employee Stock Purchase Plan As of December 31, 2023, there were 175,554 shares of Class A common stock reserved for issuance under the Offerpad Solutions Inc. 2021 Employee Stock Purchase Plan (“ESPP”). Pursuant to the terms of the ESPP, the number of shares of the Company’s Class A common stock available for issuance under the ESPP automatically increased by 111,248 shares of Class A common stock on January 1, 2024. Following this increase, there were 286,802 shares reserved for issuance under the ESPP as of June 30, 2024. As of June 30, 2024, no shares have been issued under the ESPP. Restricted Stock Units During the six months ended June 30, 2024, the Company granted RSUs with service vesting conditions to employees and non-employee members of our Board. The vesting period for RSUs granted to employees is generally three years, subject to continued employment, and the vesting period for RSUs granted to non-employee members of our Board generally ranges from three months to three years, subject to continued service on the Board. The following summarizes RSU award activity during the six months ended June 30, 2024:   Number of RSUs (in thousands)     Weighted Average Grant Date Fair Value   Outstanding as of December 31, 2023   250     $ 29.77   Granted   900       5.23   Vested and settled   (96 )     24.60   Forfeited   (20 )     23.97   Outstanding as of June 30, 2024   1,034       9.00   As of June 30, 2024, 0.1 million RSUs have vested, but have not yet been settled in shares of the Company’s Class A common stock, pursuant to elections made by certain non-employee members of our Board to defer settlement thereof under the Offerpad Solutions Inc. Deferred Compensation Plan for Directors. As of June 30, 2024, the Company had $5.7 million of unrecognized stock-based compensation expense related to unvested RSUs. This expense is expected to be recognized over a weighted average period of 2.59 years. The fair value of RSUs that vested and settled during the six months ended June 30, 2024 and 2023 was $1.8 million and $2.5 million, respectively. Performance-Based Restricted Stock Units The following summarizes PSU award activity during the six months ended June 30, 2024:   Number of PSUs (in thousands)     Weighted Average Grant Date Fair Value   Outstanding as of December 31, 2023   119     $ 70.81   Granted   —       —   Vested   —       —   Forfeited   —       —   Outstanding as of June 30, 2024   119       70.81   As of June 30, 2024, the Company had $1.9 million of unrecognized stock-based compensation expense related to unvested PSUs. This expense is expected to be recognized over a weighted average period of 0.67 years. Other Cash or Stock-Based Awards During the six months ended June 30, 2024, the Company granted long-term incentive awards, which include both a service vesting condition and a performance vesting condition that is associated with the share price of the Company’s Class A common stock (“LTI Award”). The Company also amended certain terms and conditions associated with the LTI Awards granted in 2023. Both the newly amended and granted LTI Awards will become earned during a three-year performance period based on the appreciation in the price of the Company’s Class A common stock over pre-determined price per share goals set forth in the LTI Award agreements. The portion of the LTI Award that will become earned will be determined based on the average share price over the 60 consecutive calendar-day period ending on (and including) the end of the performance period, the total number of shares of the Company’s Class A common stock outstanding as of the last day of the performance period and the participant sharing rates as set forth in the LTI Award agreements. To the extent that an LTI Award is earned during the performance period, half of the earned LTI Award will vest at the end of the three-year performance period, and the remaining half of the earned LTI Award will vest one year after the end of the performance period, in each case, subject to the employee’s continued service through the applicable vesting date. If the LTI Award does not become earned as of the last day of the performance period, each LTI Award automatically will be forfeited and terminated without consideration. The Company determined the fair value of the LTI awards using a Monte Carlo simulation model that determines the probability of satisfying the market condition stipulated in the award. The assumptions used in the Monte Carlo simulation model to determine the fair value of the LTI Awards during the six months ended June 30, 2024 are as follows: Risk-free interest rate   4.36% Expected stock price volatility   95.0% Expected dividend yield   0.0% Fair value on grant date   $5.08 The LTI Awards, to the extent vested, can be settled in cash or shares of Company Class A common stock (as determined by the Compensation Committee of the Board in its discretion). As of June 30, 2024, the Company has the intent and ability to settle the LTI Awards in shares of the Company’s Class A common stock. As of June 30, 2024, the Company had $3.4 million of unrecognized stock-based compensation expense related to the LTI Awards. This expense is expected to be recognized over a weighted average period of 3.45 years. Stock Options The following summarizes stock option activity during the six months ended June 30, 2024:     Number of Shares  (in thousands)     Weighted- Average Exercise Price Per Share     Weighted Average Remaining Contractual Term (in years)     Aggregate Intrinsic Value (in thousands)   Outstanding as of December 31, 2023     1,078     $ 12.04       4.26     $ 1,686   Granted     —       —               Exercised     (5 )     2.95               Forfeited, canceled or expired     (34 )     18.29               Outstanding as of June 30, 2024     1,039       11.89       3.71       314   Exercisable as of June 30, 2024     1,000       11.57       3.59       314   Vested and expected to vest as of June 30, 2024     1,039       11.89       3.71       314   The total intrinsic value of stock options exercised during the six months ended June 30, 2024 and 2023 was less than $0.1 million and $0.1 million, respectively. As of June 30, 2024, the Company had unrecognized stock-based compensation expense related to unvested stock options of $0.6 million. This expense is expected to be recognized over a weighted average period of 0.87 years. The fair value of stock options that vested during the six months ended June 30, 2024 and 2023 was $0.6 million and $1.1 million, respectively. Stock-based Compensation Expense The following details stock-based compensation expense for the respective periods:     Three Months Ended June 30,     Six Months Ended June 30,   ($ in thousands)   2024     2023     2024     2023   Sales, marketing and operating   $ 1,129     $ 501   $ 2,305     $ 829   General and administrative     1,995       1,469     4,395       2,913   Technology and development     125       85       416       156   Stock-based compensation expense   $ 3,249     $ 2,055     $ 7,116     $ 3,898

Variable Interest Entities	6 Months Ended
	Jun. 30, 2024
Variable Interest Entities [Abstract]
Variable Interest Entities	Note 12. Variable Interest Entities The Company formed certain special purpose entities (each, an “SPE”) to purchase and sell residential properties. Each SPE is a wholly-owned subsidiary of the Company and a separate legal entity, and neither the assets nor credit of any such SPE are available to satisfy the debts and other obligations of any affiliate or other entity. The credit facilities are secured by the assets and equity of one or more SPEs. These SPEs are variable interest entities, and the Company is the primary beneficiary as it has the power to control the activities that most significantly impact the SPEs’ economic performance and the obligation to absorb losses of the SPEs or the right to receive benefits from the SPEs that could potentially be significant to the SPEs. The SPEs are consolidated within the Company’s condensed consolidated financial statements. The following summarizes the assets and liabilities related to the VIEs as of the respective period ends:     June 30,     December 31,   ($ in thousands)   2024     2023   Assets             Restricted cash   $ 16,092     $ 3,867   Accounts receivable     3,203       6,782   Real estate inventory     307,750       276,500   Prepaid expenses and other current assets     407       1,588   Total assets   $ 327,452     $ 288,737   Liabilities             Accounts payable   $ 1,903     $ 1,798   Accrued and other current liabilities     1,757       2,027   Secured credit facilities and other debt, net     303,786       257,224   Total liabilities   $ 307,446     $ 261,049

Earnings Per Share	6 Months Ended
	Jun. 30, 2024
Earnings Per Share [Abstract]
Earnings Per Share	Note 13. Earnings Per Share Basic earnings per share is calculated based on the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated based on the weighted average number of common shares plus the incremental effect of dilutive potential common shares outstanding during the period. In periods when losses are reported, the weighted average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive. The components of basic and diluted earnings per share are as follows:     Three Months Ended June 30,     Six Months Ended June 30,   (In thousands, except per share data)   2024     2023     2024     2023   Numerator:                         Net loss   $ (13,782 )   $ (22,344 )   $ (31,297 )   $ (81,791 ) Denominator:                         Weighted average common shares outstanding, basic     27,385       27,258       27,362       25,470   Dilutive effect of stock options (1)     —       —       —       —   Dilutive effect of restricted stock units (1)     —       —       —       —   Weighted average common shares outstanding, diluted     27,385       27,258       27,362       25,470   Net loss per share, basic   $ (0.50 )   $ (0.82 )   $ (1.14 )   $ (3.21 ) Net loss per share, diluted   $ (0.50 )   $ (0.82 )   $ (1.14 )   $ (3.21 ) Anti-dilutive securities excluded from diluted loss per share:                         Anti-dilutive stock options (1)     927       1,029       950       1,048   Anti-dilutive restricted stock units (1)     138       69       134       75   Anti-dilutive performance-based restricted stock units     119       127       119       127   Anti-dilutive warrants     1,452       1,452       1,452       1,452   (1) Due to the net loss during each of the three and six months ended June 30, 2024 and 2023, no dilutive securities were included in the calculation of diluted loss per share because they would have been anti-dilutive.

Income Taxes	6 Months Ended
	Jun. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Note 14. Income Taxes The Company determines its interim tax provision by applying the estimated effective income tax rate expected to be applicable for the full fiscal year to its income (loss) before income taxes for the period. The Company’s effective tax rate is dependent on several factors, such as tax rates in state jurisdictions and the relative amount of income the Company earns in the respective jurisdiction. The Company recorded an income tax benefit of $0.1 million during the three months ended June 30, 2024 and income tax expense of less than $0.1 million during the three months ended June 30, 2023, and income tax expense of $0.1 million and $0.2 million during the six months ended June 30, 2024 and 2023, respectively. The Company’s effective tax rate was a benefit of 0.4% and an expense of 0.2% for the three months ended June 30, 2024 and 2023, respectively, and an expense of 0.2% for each of the six months ended June 30, 2024 and 2023, respectively. The Company’s effective tax rate during the three and six months ended June 30, 2024 differed from the federal statutory rate of 21% primarily due to net operating loss carryforwards and state taxes. The valuation allowance recorded against our net deferred tax assets was $111.0 million as of June 30, 2024. As of June 30, 2024, we continue to have a full valuation allowance recorded against all deferred tax assets and will continue to evaluate our valuation allowance in future periods for any change in circumstances that causes a change in judgment about the realizability of the deferred tax assets. The amount of the deferred tax assets considered realizable, however, could be adjusted in future periods if estimates of future taxable income during the carryforward period are increased, if objective negative evidence in the form of cumulative losses is no longer present, and if we employ tax planning strategies in the future. The Internal Revenue Code contains provisions that limit the utilization of net operating loss carryforwards and tax credit carryforwards if there has been an ownership change. Such ownership change, as described in Section 382 of the Internal Revenue Code, may limit the Company’s ability to utilize its net operating loss carryforwards and tax credit carryforwards on a yearly basis. To the extent that any single-year limitation is not utilized to the full amount of the limitation, such unused amounts are carried over to subsequent years until the earlier of utilization or the expiration of the relevant carryforward period. The Company determined that an ownership change occurred on February 10, 2017. An analysis was performed and while utilization of net operating losses would be limited in years prior to December 31, 2020, subsequent to that date, there is no limitation on the Company’s ability to utilize its net operating losses. As such, the ownership change has no impact to the carrying value of the Company’s net operating loss carryforwards or ability to use them in future years.

Related-Party Transactions	6 Months Ended
	Jun. 30, 2024
Related Party Transactions [Abstract]
Related-Party Transactions	Note 15. Related-Party Transactions LL Credit Facilities As of June 30, 2024, we have one senior secured credit facility with a related party and two mezzanine secured credit facilities with a related party (the “LL Credit Facilities”). The following summarizes certain details related to these facilities:     As of June 30, 2024     As of December 31, 2023   ($ in thousands)   Borrowing Capacity     Outstanding Amount     Borrowing Capacity     Outstanding Amount   Senior secured credit facility with a related party   $ 50,000     $ 10,284     $ 50,000     $ 6,289   Mezzanine secured credit facilities with a related party   $ 92,000     $ 21,615     $ 92,000     $ 23,803   Since October 2016, we have been party to a loan and security agreement (the “LL Funds Loan Agreement”), with LL Private Lending Fund, L.P. and LL Private Lending Fund II, L.P., both of which are affiliates of LL Capital Partners I, L.P., which holds more than 5% of our Class A common stock. Additionally, Roberto Sella, who is a member of our Board and holds more than 5% of our Class A common stock, is the managing partner of LL Funds. The LL Funds Loan Agreement is comprised of a senior secured credit facility and a mezzanine secured credit facility, under which we may borrow funds up to a maximum principal amount of $50.0 million and $22.0 million, respectively. The LL Funds Loan Agreement also provides us with the option to borrow above the fully committed borrowing capacity, subject to the lender’s discretion. Refer to Note 7. Credit Facilities and Other Debt, for further details about the facilities under the LL Funds Loan Agreement. Since March 2020, we have also been party to a mezzanine loan and security agreement (the “LL Mezz Loan Agreement”), with LL Private Lending Fund II, L.P., which is an affiliate of LL Capital Partners I, L.P. Under the LL Mezz Loan Agreement, we may borrow funds up to a maximum principal amount of $70.0 million. Refer to Note 7. Credit Facilities and Other Debt, for further details about the mezzanine facility under the LL Mezz Loan Agreement. We paid interest for borrowings under the LL Credit Facilities of $0.8 million and $0.7 million during the three months ended June 30, 2024 and 2023, respectively, and $1.8 million and $2.2 million during the six months ended June 30, 2024 and 2023, respectively. Use of First American Financial Corporation’s Services First American Financial Corporation (“First American”), which holds more than 5% of our Class A common stock, through its subsidiaries is a provider of title insurance and settlement services for real estate transactions and a provider of property data services. Additionally, Kenneth DeGiorgio, who is a member of the Company’s Board, is the chief executive officer of First American. We use First American’s services in the ordinary course of our home-buying and home-selling activities. We paid First American $1.5 million and $1.6 million during the three months ended June 30, 2024 and 2023, respectively, and $3.2 million and $4.3 million during the six months ended June 30, 2024 and 2023, respectively, for its services, inclusive of the fees for property data services. Compensation of Immediate Family Members of Brian Bair Offerpad employs two of Brian Bair’s brothers, along with Mr. Bair’s sister-in-law. The following details the total compensation paid to Mr. Bair’s brothers and Mr. Bair’s sister-in-law, which includes both base salary and annual performance-based cash incentives during each of the respective periods:     Three Months Ended June 30,     Six Months Ended June 30,   ($ in thousands)   2024     2023     2024     2023   Mr. Bair’s brother 1   $ 99     $ 99   $ 262     $ 468   Mr. Bair’s brother 2     92       92     245       440   Mr. Bair’s sister-in-law     31       29       67       80       $ 222     $ 220     $ 574     $ 988     During the six months ended June 30, 2024, Mr. Bair’s brothers and Mr. Bair’s sister-in-law received the following restricted stock unit awards: Mr. Bair’s brother 1     42,500   Mr. Bair’s brother 2     40,000   Mr. Bair’s sister-in-law     6,000         88,500   During the six months ended June 30, 2024, the Company amended certain terms and conditions associated with the LTI Awards granted to Mr. Bair’s brothers and Mr. Bair’s sister-in-law in 2023, including the performance period, price per share goals and sharing rates. Refer to Note 11. Stock-Based Awards, for further details. Warehouse Lending Facility with FirstFunding, Inc. During 2022, Offerpad Mortgage, LLC (“Offerpad Home Loans” or “OPHL”), a wholly-owned subsidiary of the Company, entered into a warehouse lending facility with FirstFunding, Inc., a wholly-owned subsidiary of First American, which holds more than 5% of our Class A common stock. Offerpad Home Loans used the warehouse lending facility to fund mortgage loans it originated and then sold to third-party mortgage servicers. During April 2024, the warehouse lending facility expired and was not renewed. The fees paid under the facility were immaterial during the periods in which the facility was used. Pre-Funded Warrants During January 2023, the Company sold and issued pre-funded warrants to purchase shares of the Company’s Class A common stock. The investors included Brian Bair, Roberto Sella, First American, and Kenneth DeGiorgio. Refer to Note 10. Stockholders’ Equity, for further details.

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Note 16. Commitments and Contingencies Homes Purchase Commitments As of June 30, 2024, the Company was under contract to purchase 359 homes for an aggregate purchase price of $102.7 million. Lease Commitments The Company has entered into operating lease agreements for its existing corporate headquarters in Chandler, Arizona, its future corporate headquarters in Tempe, Arizona, and field office facilities in most of the metropolitan markets in which the Company operates in the United States. Refer to Note 5. Leases, for further details. Legal and Other Matters The Company is subject to various actions, claims, suits and other legal proceedings that arise in the ordinary course of business, including, without limitation, assertions by third parties relating to intellectual property infringement, breaches of contract or warranties or employment-related matters. The Company records accruals for loss contingencies when it is probable that a loss will occur, and the amount of such loss can be reasonably estimated. The Company is not currently a party to any actions, claims, suits or other legal proceedings, the outcome of which, if determined adversely to the Company, would individually or in the aggregate have a material adverse effect on the Company’s condensed consolidated financial statements.

Subsequent Events	6 Months Ended
	Jun. 30, 2024
Subsequent Events [Abstract]
Subsequent Events	Note 17. Subsequent Events The Company has determined that there have been no events that have occurred that would require recognition in the condensed consolidated financial statements or additional disclosure herein.

Nature of Operations and Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Description of Business	Description of Business Offerpad, dedicated to simplifying the process of buying and selling homes, is committed to providing comprehensive solutions that remove the friction from real estate. Our advanced real estate platform offers a range of services, from consumer cash offers to B2B renovation solutions and industry partnership programs, all tailored to meet the unique needs of our clients. Since 2015, we’ve leveraged local expertise in residential real estate alongside proprietary technology to guide homeowners at every step. The Company is currently headquartered in Chandler, Arizona and operates in over 1,800 cities and towns in 27 metropolitan markets across 17 states as of June 30, 2024.
Basis of Presentation and Interim Financial Information	Basis of Presentation and Interim Financial Information The accompanying unaudited interim condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to GAAP and SEC rules and regulations. Accordingly, the unaudited interim condensed consolidated financial statements do not include all of the information and note disclosures required by GAAP for complete financial statements. Therefore, this information should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s audited consolidated financial statements as of and for the year ended December 31, 2023 included in the Company’s 2023 Annual Report on Form 10-K as filed with the SEC on February 27, 2024. The accompanying financial information reflects all adjustments which are, in the opinion of the Company’s management, of a normal recurring nature and necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim periods. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).
Reverse Stock Split	Reverse Stock Split On June 12, 2023, the Company filed a certificate of amendment to its Third Restated Certificate of Incorporation (as amended from time to time, the “Certificate of Incorporation”) with the Secretary of State of the State of Delaware to effect a 1-for-15 reverse stock split (the “Reverse Stock Split”). The Company’s Class A common stock began trading on a split-adjusted basis at market open on June 13, 2023 under the existing symbol “OPAD”.
Use of Estimates	Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements. Significant estimates include those related to the net realizable value of real estate inventory, among others. Actual results could differ from those estimates.
Principles of Consolidation	Principles of Consolidation The Company’s condensed consolidated financial statements include the assets, liabilities, revenues and expenses of the Company, its wholly-owned operating subsidiaries and variable interest entities where the Company is the primary beneficiary. All intercompany accounts and transactions have been eliminated in consolidation.
Real Estate Inventory	Real Estate Inventory Real estate inventory consists of acquired homes and is stated at the lower of cost or net realizable value, with cost and net realizable value determined by the specific identification of each home. Costs include initial purchase costs and renovation costs, as well as holding costs and interest incurred during the renovation period, prior to the listing date. Selling costs, including commissions and holding costs incurred after the listing date, are expensed as incurred and included in sales, marketing and operating expenses. The Company reviews real estate inventory for valuation adjustments on a quarterly basis, or more frequently if events or changes in circumstances indicate that the carrying value of real estate inventory may not be recoverable. The Company evaluates real estate inventory for indicators that net realizable value is lower than cost at the individual home level. The Company generally considers multiple factors in determining net realizable value for each home, including recent comparable home sale transactions in the specific area where the home is located, the residential real estate market conditions in both the local market in which the home is located and in the U.S. in general, the impact of national, regional or local economic conditions and expected selling costs. When evidence exists that the net realizable value of real estate inventory is lower than its cost, the difference is recognized as a real estate inventory valuation adjustment in cost of revenue and the related real estate inventory is adjusted to its net realizable value. For individual homes or portfolios of homes under contract to sell as of the real estate inventory valuation assessment date, if the carrying value exceeds the contract price less expected selling costs, the carrying value of these homes are adjusted to the contract price less expected selling costs. For all other homes, if the carrying value exceeds the expected sale price less expected selling costs, the carrying value of these homes are adjusted to the expected sale price less expected selling costs. Changes in the Company’s pricing assumptions may lead to a change in the outcome of the real estate inventory valuation analysis, and actual results may differ from the Company’s assumptions. The Company recorded real estate inventory valuation adjustments of $0.6 million and $0.2 million during the three months ended June 30, 2024 and 2023, respectively, and $1.2 million and $7.5 million during the six months ended June 30, 2024 and 2023, respectively. Refer to Note 2. Real Estate Inventory, for further details.
Recent Accounting Standards	Recent Accounting Standards Income Tax Disclosures In December 2023, the FASB issued a new standard which is intended to improve an entity’s income tax disclosures, primarily through disaggregated information about an entity’s effective income tax rate reconciliation and additional disclosures about income taxes paid. The new standard is effective for annual periods beginning after December 15, 2024. Accordingly, the new standard is effective for the Company on January 1, 2025 on a prospective basis. The Company is currently evaluating the impact that the standard will have on its condensed consolidated financial statements. Segment Reporting In November 2023, the FASB issued a new standard which is intended to improve disclosures about an entity’s reportable segments, primarily through enhanced disclosures about significant segment expenses. The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. Accordingly, the new standard is effective for the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and subsequent interim periods, using a retrospective approach. The Company is currently evaluating the impact that the standard will have on its condensed consolidated financial statements.

Real Estate Inventory (Tables)	6 Months Ended
	Jun. 30, 2024
Inventory Disclosure [Abstract]
Schedule of Components of Inventory	The components of real estate inventory, net of applicable lower of cost or net realizable value adjustments, consist of the following as of the respective period ends:     June 30,     December 31,   ($ in thousands)   2024     2023   Homes preparing for and under renovation   $ 87,383     $ 53,116   Homes listed for sale     158,953       148,648   Homes under contract to sell     61,414       74,736   Real estate inventory   $ 307,750     $ 276,500

Property and Equipment (Tables)	6 Months Ended
	Jun. 30, 2024
Property, Plant and Equipment [Abstract]
Schedule of Property and Equipment	Property and equipment consist of the following as of the respective period ends:     June 30,     December 31,   ($ in thousands)   2024     2023   Rooftop solar panel systems   $ 4,999     $ 5,075   Leasehold improvements     1,071       1,130   Office equipment and furniture     833       837   Software systems     386       386   Computers and equipment     265       265   Construction in progress     394       32   Property and equipment, gross     7,948       7,725   Less: accumulated depreciation     (3,456 )     (3,208 ) Property and equipment, net   $ 4,492     $ 4,517

Leases (Tables)	6 Months Ended
	Jun. 30, 2024
Leases [Abstract]
Schedule of Company Operating Lease Liability Maturities	The Company’s operating lease liability maturities as of June 30, 2024 are as follows: ($ in thousands)       Remainder of 2024   $ 1,165   2025     2,898   2026     2,089   2027     1,949   2028     1,922   2029     1,974   Thereafter     11,862   Total future lease payments     23,859   Less: Imputed interest     (7,105 ) Less: Tenant incentive receivable     (5,532 ) Total lease liabilities   $ 11,222
Schedule of Company Operating Lease Right of Use Assets and Operating Lease Liabilities	The Company’s operating lease right-of-use assets and operating lease liabilities, and the associated financial statement line items, are as follows as of the respective period ends:         June 30,     December 31,   ($ in thousands)   Financial Statement Line Items   2024     2023   Right-of-use assets   Other non-current assets   $ 9,934     $ 3,338   Lease liabilities:                 Current liabilities   Accrued and other current liabilities     2,019       2,271   Non-current liabilities   Other long-term liabilities     9,203       1,418   Total lease liabilities       $ 11,222     $ 3,689

Accrued and Other Liabilities (Tables)	6 Months Ended
	Jun. 30, 2024
Payables and Accruals [Abstract]
Schedule of Accrued and Other Liabilities	Accrued and other current liabilities consist of the following as of the respective period ends:     June 30,     December 31,   ($ in thousands)   2024     2023   Home renovation   $ 3,318     $ 3,534   Payroll and other employee related expenses     2,352       3,200   Operating lease liabilities     2,019       2,271   Marketing     1,894       999   Interest     1,729       1,989   Legal and professional obligations     604       392   Other     1,179       1,474   Accrued and other current liabilities   $ 13,095     $ 13,859

Credit Facilities and Other Debt (Tables)	6 Months Ended
	Jun. 30, 2024
Line Of Credit Facility [Line Items]
Schedule of Carrying Values of Company Debt	The carrying value of the Company’s credit facilities and other debt consists of the following as of the respective period ends:   June 30,     December 31,   ($ in thousands) 2024     2023   Credit facilities and other debt, net           Senior secured credit facilities with financial institutions $ 246,396     $ 216,654   Senior secured credit facility with a related party   10,284       6,289   Mezzanine secured credit facilities with financial institutions   26,564       12,704   Mezzanine secured credit facilities with a related party   21,615       23,803   Debt issuance costs   (1,073 )     (2,226 ) Total credit facilities and other debt, net   303,786       257,224   Current portion - credit facilities and other debt, net           Total credit facilities and other debt, net   271,887       227,132   Total credit facilities and other debt - related party   31,899       30,092   Total credit facilities and other debt, net $ 303,786     $ 257,224
Summary of Company Senior Secured Credit Facilities	The following summarizes certain details related to the Company’s senior secured credit facilities (in thousands, except interest rates):   Borrowing Capacity   Outstanding   Weighted- Average Interest   End of Revolving / Withdrawal   Final Maturity As of June 30, 2024 Committed   Uncommitted   Total   Amount   Rate   Period   Date Senior financial institution 1 $150,000   $250,000   $400,000   $112,927   8.13%   December 2025   June 2026 Senior financial institution 2 100,000   100,000   200,000   54,537   8.07%   January 2025   July 2025 Senior financial institution 3 100,000   50,000   150,000   59,337   8.58%   January 2025   April 2025 Related party 30,000   20,000   50,000   10,284   10.33%   March 2025   September 2025 Senior financial institution 4 30,000   45,000   75,000   19,595   9.83%   August 2024   February 2025 Senior secured credit facilities $410,000   $465,000   $875,000   $256,680                 Borrowing Capacity     Outstanding     Weighted- Average Interest           As of December 31, 2023 Committed     Uncommitted     Total     Amount     Rate           Senior financial institution 1 $ 200,000     $ 200,000     $ 400,000     $ 135,676       7.91 %         Senior financial institution 2   100,000       100,000       200,000       55,541       7.61 %         Senior financial institution 3   100,000       50,000       150,000       6,453       7.11 %         Related party   30,000       20,000       50,000       6,289       10.05 %         Senior financial institution 4   30,000       45,000       75,000       18,984       8.42 %         Senior secured credit facilities $ 460,000     $ 415,000     $ 875,000     $ 222,943
Mezzanine Revolving Credit Facilities
Line Of Credit Facility [Line Items]
Summary of Company Senior Secured Credit Facilities	The following summarizes certain details related to the Company’s mezzanine secured credit facilities (in thousands, except interest rates):   Borrowing Capacity   Outstanding   Weighted- Average Interest   End of Revolving / Withdrawal   Final Maturity As of June 30, 2024 Committed   Uncommitted   Total   Amount   Rate   Period   Date Related party facility 1 $45,000   $25,000   $70,000   $19,111   13.83%   June 2025   December 2025 Mezzanine financial institution 1 22,500   22,500   45,000   10,714   13.92%   January 2025   July 2025 Mezzanine financial institution 2 26,667   13,333   40,000   15,850   12.58%   January 2025   April 2025 Related party facility 2 8,000   14,000   22,000   2,504   13.83%   March 2025   September 2025 Mezzanine secured credit facilities $102,167   $74,833   $177,000   $48,179                 Borrowing Capacity   Outstanding   Weighted- Average Interest         As of December 31, 2023 Committed   Uncommitted   Total   Amount   Rate         Related party facility 1 $45,000   $25,000   $70,000   $22,250   11.56%         Mezzanine financial institution 1 22,500   22,500   45,000   11,198   12.79%         Mezzanine financial institution 2 26,667   13,333   40,000   1,506   9.55%         Related party facility 2 8,000   14,000   22,000   1,553   13.05%         Mezzanine secured credit facilities $102,167   $74,833   $177,000   $36,507

Fair Value Measurements (Tables)	6 Months Ended
	Jun. 30, 2024
Fair Value Disclosures [Abstract]
Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis	The Company’s liabilities that are measured at fair value on a recurring basis consist of the following (in thousands): As of June 30, 2024   Quoted Prices in Active Markets for Identical Liabilities (Level 1)     Significant Other Observable Inputs (Level 2)     Significant Unobservable Inputs (Level 3)   Public warrant liabilities   $ 58     $ —     $ —   Private placement warrant liabilities   $ —     $ —     $ 78   As of December 31, 2023   Quoted Prices in Active Markets for Identical Liabilities (Level 1)     Significant Other Observable Inputs (Level 2)     Significant Unobservable Inputs (Level 3)   Public warrant liabilities   $ 305     $ —     $ —   Private placement warrant liabilities   $ —     $ —     $ 166
Schedule of Changes in Private Placement Warrant Liabilities Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs	The following summarizes the changes in the Company’s private placement warrant liabilities, which are measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the respective periods:     Three Months Ended June 30,     Six Months Ended June 30,   ($ in thousands)   2024     2023     2024     2023   Beginning balance   $ 75     $ 285   $ 166     $ 196   Change in fair value of private placement warrants included in net loss     3       (114 )     (88 )     (25 ) Ending balance   $ 78     $ 171     $ 78     $ 171

Stock-Based Awards (Tables)	6 Months Ended
	Jun. 30, 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Summary of RSU award activity	The following summarizes RSU award activity during the six months ended June 30, 2024:   Number of RSUs (in thousands)     Weighted Average Grant Date Fair Value   Outstanding as of December 31, 2023   250     $ 29.77   Granted   900       5.23   Vested and settled   (96 )     24.60   Forfeited   (20 )     23.97   Outstanding as of June 30, 2024   1,034       9.00
Summary of PSU award activity	The following summarizes PSU award activity during the six months ended June 30, 2024:   Number of PSUs (in thousands)     Weighted Average Grant Date Fair Value   Outstanding as of December 31, 2023   119     $ 70.81   Granted   —       —   Vested   —       —   Forfeited   —       —   Outstanding as of June 30, 2024   119       70.81
Schedule of Assumptions Used	The assumptions used in the Monte Carlo simulation model to determine the fair value of the LTI Awards during the six months ended June 30, 2024 are as follows: Risk-free interest rate   4.36% Expected stock price volatility   95.0% Expected dividend yield   0.0% Fair value on grant date   $5.08
Summary of Stock Option Activity	The following summarizes stock option activity during the six months ended June 30, 2024:     Number of Shares  (in thousands)     Weighted- Average Exercise Price Per Share     Weighted Average Remaining Contractual Term (in years)     Aggregate Intrinsic Value (in thousands)   Outstanding as of December 31, 2023     1,078     $ 12.04       4.26     $ 1,686   Granted     —       —               Exercised     (5 )     2.95               Forfeited, canceled or expired     (34 )     18.29               Outstanding as of June 30, 2024     1,039       11.89       3.71       314   Exercisable as of June 30, 2024     1,000       11.57       3.59       314   Vested and expected to vest as of June 30, 2024     1,039       11.89       3.71       314
Schedule of stock-based compensation expense	The following details stock-based compensation expense for the respective periods:     Three Months Ended June 30,     Six Months Ended June 30,   ($ in thousands)   2024     2023     2024     2023   Sales, marketing and operating   $ 1,129     $ 501   $ 2,305     $ 829   General and administrative     1,995       1,469     4,395       2,913   Technology and development     125       85       416       156   Stock-based compensation expense   $ 3,249     $ 2,055     $ 7,116     $ 3,898

Variable Interest Entities (Tables)	6 Months Ended
	Jun. 30, 2024
Variable Interest Entities [Abstract]
Summary of Assets and Liabilities Related to VIEs	The following summarizes the assets and liabilities related to the VIEs as of the respective period ends:     June 30,     December 31,   ($ in thousands)   2024     2023   Assets             Restricted cash   $ 16,092     $ 3,867   Accounts receivable     3,203       6,782   Real estate inventory     307,750       276,500   Prepaid expenses and other current assets     407       1,588   Total assets   $ 327,452     $ 288,737   Liabilities             Accounts payable   $ 1,903     $ 1,798   Accrued and other current liabilities     1,757       2,027   Secured credit facilities and other debt, net     303,786       257,224   Total liabilities   $ 307,446     $ 261,049

Earnings Per Share (Tables)	6 Months Ended
	Jun. 30, 2024
Earnings Per Share [Abstract]
Summary of Components of Basic and Diluted Earnings Per Share	The components of basic and diluted earnings per share are as follows:     Three Months Ended June 30,     Six Months Ended June 30,   (In thousands, except per share data)   2024     2023     2024     2023   Numerator:                         Net loss   $ (13,782 )   $ (22,344 )   $ (31,297 )   $ (81,791 ) Denominator:                         Weighted average common shares outstanding, basic     27,385       27,258       27,362       25,470   Dilutive effect of stock options (1)     —       —       —       —   Dilutive effect of restricted stock units (1)     —       —       —       —   Weighted average common shares outstanding, diluted     27,385       27,258       27,362       25,470   Net loss per share, basic   $ (0.50 )   $ (0.82 )   $ (1.14 )   $ (3.21 ) Net loss per share, diluted   $ (0.50 )   $ (0.82 )   $ (1.14 )   $ (3.21 ) Anti-dilutive securities excluded from diluted loss per share:                         Anti-dilutive stock options (1)     927       1,029       950       1,048   Anti-dilutive restricted stock units (1)     138       69       134       75   Anti-dilutive performance-based restricted stock units     119       127       119       127   Anti-dilutive warrants     1,452       1,452       1,452       1,452   (1) Due to the net loss during each of the three and six months ended June 30, 2024 and 2023, no dilutive securities were included in the calculation of diluted loss per share because they would have been anti-dilutive.

Related-Party Transactions (Tables)	6 Months Ended
	Jun. 30, 2024
Related Party Transaction [Line Items]
Summary of Related Parties	The following details the total compensation paid to Mr. Bair’s brothers and Mr. Bair’s sister-in-law, which includes both base salary and annual performance-based cash incentives during each of the respective periods:     Three Months Ended June 30,     Six Months Ended June 30,   ($ in thousands)   2024     2023     2024     2023   Mr. Bair’s brother 1   $ 99     $ 99   $ 262     $ 468   Mr. Bair’s brother 2     92       92     245       440   Mr. Bair’s sister-in-law     31       29       67       80       $ 222     $ 220     $ 574     $ 988
Grants of Equity Awards to Related Parties	During the six months ended June 30, 2024, Mr. Bair’s brothers and Mr. Bair’s sister-in-law received the following restricted stock unit awards: Mr. Bair’s brother 1     42,500   Mr. Bair’s brother 2     40,000   Mr. Bair’s sister-in-law     6,000         88,500
LL Credit Facilities [Member]
Related Party Transaction [Line Items]
Summary of Related Parties	The following summarizes certain details related to these facilities:     As of June 30, 2024     As of December 31, 2023   ($ in thousands)   Borrowing Capacity     Outstanding Amount     Borrowing Capacity     Outstanding Amount   Senior secured credit facility with a related party   $ 50,000     $ 10,284     $ 50,000     $ 6,289   Mezzanine secured credit facilities with a related party   $ 92,000     $ 21,615     $ 92,000     $ 23,803

Nature of Operations and Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Real estate inventory valuation adjustment	$ 600	$ 200	$ 1,168	$ 7,454

Real Estate Inventory - Schedule of Components of Inventory (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Homes preparing for and under renovation	$ 87,383	$ 53,116
Homes listed for sale	158,953	148,648
Homes under contract to sell	61,414	74,736
Real estate inventory	$ 307,750	$ 276,500

Derivative Financial Instruments (Additional Information) (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Derivative [Line Items]
Payment to acquire option		$ 1.9
Change in Fair Value of Derivative Instrument	$ (0.1)		$ (0.7)

Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Property Plant And Equipment [Line Items]
Property and equipment, gross	$ 7,948	$ 7,725
Less: accumulated depreciation	(3,456)	(3,208)
Property and equipment, net	4,492	4,517
Rooftop Solar Panel Systems
Property Plant And Equipment [Line Items]
Property and equipment, gross	4,999	5,075
Leasehold Improvements
Property Plant And Equipment [Line Items]
Property and equipment, gross	1,071	1,130
Office Equipment and Furniture
Property Plant And Equipment [Line Items]
Property and equipment, gross	833	837
Software Systems
Property Plant And Equipment [Line Items]
Property and equipment, gross	386	386
Computers and Equipment
Property Plant And Equipment [Line Items]
Property and equipment, gross	265	265
Construction In Progress
Property Plant And Equipment [Line Items]
Property and equipment, gross	$ 394	$ 32

Property and Equipment - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 100	$ 200	$ 314	$ 380

Leases - Schedule of Company Operating Lease Liability Maturities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Leases [Abstract]
Remainder of 2024	$ 1,165
2025	2,898
2026	2,089
2027	1,949
2028	1,922
2029	1,974
Thereafter	11,862
Total future lease payments	23,859
Less: Imputed interest	(7,105)
Less: Tenant incentive receivable	(5,532)
Total lease liabilities	$ 11,222	$ 3,689

Leases - Schedule of Company Operating Lease Right-of-Use Assets and Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Leases [Abstract]
Right-of-use assets	$ 9,934	$ 3,338
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Other Assets, Noncurrent
Operating Lease, Liability, Current	$ 2,019	2,271
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration]	Accrued and other current liabilities
Operating Lease, Liability, Noncurrent	$ 9,203	1,418
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration]	Other Liabilities, Noncurrent
Operating Lease, Liability, Total	$ 11,222	$ 3,689

Leases (Additional Information) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Lessee, Lease, Description [Line Items]
Operating Lease, Cost	$ 0.9	$ 0.6	$ 1.8	$ 1.2
Short-Term Lease, Cost	0.1	0.1	$ 0.1	0.1
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability	$ 0.0
Operating Lease, Weighted Average Remaining Lease Term	8 years 9 months 18 days		8 years 9 months 18 days		1 year 9 months 18 days
Operating Lease, Weighted Average Discount Rate, Percent	7.10%		7.10%		4.30%
Measurement Of Operating Lease Liabilities [Member]
Lessee, Lease, Description [Line Items]
Operating Lease, Payments	$ 0.6	0.6	$ 0.9	1.2
Acquired Operating Lease Liabilities [Member]
Lessee, Lease, Description [Line Items]
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability		$ 0.0	$ 7.9	$ 0.0
Maximum [Member]
Lessee, Lease, Description [Line Items]
Lessee, Operating Lease, Lease Term	10 years		10 years
Minimum [Member]
Lessee, Lease, Description [Line Items]
Lessee, Operating Lease, Lease Term	1 year		1 year

Accrued And Other Liabilities - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Home renovation	$ 3,318	$ 3,534
Payroll and other employee related expenses	2,352	3,200
Operating lease liabilities	2,019	2,271
Marketing	1,894	999
Interest	1,729	1,989
Legal and professional obligations	604	392
Other	1,179	1,474
Accrued and other current liabilities	$ 13,095	$ 13,859

Accrued And Other Liabilities (Additional Information) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Payables and Accruals [Abstract]
Advertising Expense	$ 3.5	$ 10.9	$ 7.9	$ 18.9

Credit Facilities and Other Debt - Schedule of Carrying Values of the Company's Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Credit facilities and notes payable, net
Debt issuance costs	$ (1,073)	$ (2,226)
Total credit facilites and notes payable, net	303,786	257,224
Current portion - credit facilities and notes payable, net
Total credit facilities and notes payable	271,887	227,132
Total credit facilities and notes payable, net - related party	31,899	30,092
Total credit facilites and notes payable, net	303,786	257,224
Senior Secured Credit Facilities [Member]
Credit facilities and notes payable, net
Secured credit facilities	10,284	6,289
Senior Secured Credit Facilities [Member] | Financial Institutions [Member]
Credit facilities and notes payable, net
Secured credit facilities	246,396	216,654
Mezzanine Secured Credit Facilities [Member]
Credit facilities and notes payable, net
Secured credit facilities	21,615	23,803
Mezzanine Secured Credit Facilities [Member] | Financial Institutions [Member]
Credit facilities and notes payable, net
Secured credit facilities	$ 26,564	$ 12,704

Credit Facilities and Other Debt - Schedule of Company's Senior Secured Credit Facilities (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2024	Dec. 31, 2023
Senior Secured Credit Facilities With Financial Institutions [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	$ 410,000	$ 460,000
Uncommitted amount	465,000	415,000
Borrowing Capacity	875,000	875,000
Outstanding Amount	256,680	222,943
Revolving Credit Facility [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity	50,000	50,000
Outstanding Amount	10,284	6,289
June 2026 Revolving Credit Facility [Member] | Senior Secured Credit Facilities With Financial Institutions 1 [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	150,000	200,000
Uncommitted amount	250,000	200,000
Borrowing Capacity	400,000	400,000
Outstanding Amount	$ 112,927	$ 135,676
Weighted- Average Interest Rate	8.13%	7.91%
End of Revolving / Withdrawal Period	Dec. 31, 2025
Maturity Date	Jun. 30, 2026
July 2025 Revolving Credit Facility [Member] | Senior Secured Credit Facility With Financial Institution Two Member
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	$ 100,000	$ 100,000
Uncommitted amount	100,000	100,000
Borrowing Capacity	200,000	200,000
Outstanding Amount	$ 54,537	$ 55,541
Weighted- Average Interest Rate	8.07%	7.61%
End of Revolving / Withdrawal Period	Jan. 31, 2025
Maturity Date	Jul. 31, 2025
April 2025 Revolving Credit Facility [Member] | Senior Secured Credit Facility With Financial Institution 3 [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	$ 100,000	$ 100,000
Uncommitted amount	50,000	50,000
Borrowing Capacity	150,000	150,000
Outstanding Amount	$ 59,337	$ 6,453
Weighted- Average Interest Rate	8.58%	7.11%
End of Revolving / Withdrawal Period	Jan. 31, 2025
Maturity Date	Apr. 30, 2025
September 2025 Revolving Credit Facility [Member] | Revolving Credit Facility [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	$ 30,000	$ 30,000
Uncommitted amount	20,000	20,000
Borrowing Capacity	50,000	50,000
Outstanding Amount	$ 10,284	$ 6,289
Weighted- Average Interest Rate	10.33%	10.05%
End of Revolving / Withdrawal Period	Mar. 31, 2025
Maturity Date	Sep. 30, 2025
February 2025 Revolving Credit Facility [Member] | Senior Secured Credit Facility With Financial Institution 4 [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	$ 30,000	$ 30,000
Uncommitted amount	45,000	45,000
Borrowing Capacity	75,000	75,000
Outstanding Amount	$ 19,595	$ 18,984
Weighted- Average Interest Rate	9.83%	8.42%
End of Revolving / Withdrawal Period	Aug. 31, 2024
Maturity Date	Feb. 28, 2025

Credit Facilities and Other Debt - Additional Information (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2024 USD ($) Facility	Dec. 31, 2023 USD ($)
Common Class A [Member]
Line Of Credit Facility [Line Items]
Related party, holding percentage	5.00%
Financial Institutions [Member]
Line Of Credit Facility [Line Items]
Number of facilities | Facility	4
Related Parties [Member]
Line Of Credit Facility [Line Items]
Number of facilities | Facility	1
Senior Secured Credit Facilities With Financial Institutions [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity	$ 875,000	$ 875,000
Borrowing Capacity, Committed	$ 410,000	460,000
Senior Secured Credit Facility [Member]
Line Of Credit Facility [Line Items]
Number of facilities | Facility	5
Borrowing Capacity	$ 1,052,000
Borrowing Capacity, Committed	512,200
Revolving Credit Facility [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity	50,000	50,000
Mezzanine Revolving Credit Facilities
Line Of Credit Facility [Line Items]
Borrowing Capacity	177,000	177,000
Borrowing Capacity, Committed	$ 102,167	$ 102,167

Credit Facilities and Notes Payable - Schedule of Company's Mezzanine Secured Credit Facilities (Details) - Mezzanine Revolving Credit Facilities - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2024	Dec. 31, 2023
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	$ 102,167	$ 102,167
Uncommitted amount	74,833	74,833
Borrowing Capacity	177,000	177,000
Outstanding Amount	48,179	36,507
December 2025 Mezzanine Credit Facility With Related Party [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	45,000	45,000
Uncommitted amount	25,000	25,000
Borrowing Capacity	70,000	70,000
Outstanding Amount	$ 19,111	$ 22,250
Weighted- Average Interest Rate	13.83%	11.56%
End of Revolving / Withdrawal Period	Jun. 30, 2025
Maturity Date	Dec. 31, 2025
July 2025 Mezzanine Credit Facility With Related Party [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	$ 22,500	$ 22,500
Uncommitted amount	22,500	22,500
Borrowing Capacity	45,000	45,000
Outstanding Amount	$ 10,714	$ 11,198
Weighted- Average Interest Rate	13.92%	12.79%
End of Revolving / Withdrawal Period	Jan. 31, 2025
Maturity Date	Jul. 31, 2025
April 2025 Mezzanine Credit Facility With Related Party [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	$ 26,667	$ 26,667
Uncommitted amount	13,333	13,333
Borrowing Capacity	40,000	40,000
Outstanding Amount	$ 15,850	$ 1,506
Weighted- Average Interest Rate	12.58%	9.55%
End of Revolving / Withdrawal Period	Jan. 31, 2025
Maturity Date	Apr. 30, 2025
September 2025 Mezzanine Credit Facility With Related Party [Member]
Line Of Credit Facility [Line Items]
Borrowing Capacity, Committed	$ 8,000	$ 8,000
Uncommitted amount	14,000	14,000
Borrowing Capacity	22,000	22,000
Outstanding Amount	$ 2,504	$ 1,553
Weighted- Average Interest Rate	13.83%	13.05%
End of Revolving / Withdrawal Period	Mar. 31, 2025
Maturity Date	Sep. 30, 2024

Warrant Liabilities - Additional Information (Details)	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Derivative Warrant Liabilities [Line Items]
Warrants expiration period after completion of business combination or earlier upon redemption or liquidation date	Sep. 01, 2026
Class A Common Stock
Derivative Warrant Liabilities [Line Items]
Number of warrants or rights, excercisable	15
Warrants exercisable | $ / shares	$ 172.5
Class A Common Stock | Public Warrant
Derivative Warrant Liabilities [Line Items]
Class of warrant or right outstanding	16,100,000
Class A Common Stock | Private Placement
Derivative Warrant Liabilities [Line Items]
Class of warrant or right outstanding	5,700,000

Fair Value Measurements - Summary of Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Quoted Prices in Active Markets for Identical Liabilities (Level 1) | Public Warrant
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Warrant liabilities	$ 58	$ 305
Significant Unobservable Inputs (Level 3) | Private Placement Warrant
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Warrant liabilities	$ 78	$ 166

Fair Value Measurements - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Change in fair value of warrant liabilities	$ 9	$ (435)	$ (335)	$ (46)
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Transfers, Net	0	0	0	0
Public Warrant
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Change in fair value of warrant liabilities	$ 100	$ (300)	$ (300)	$ (20)

Fair Value Measurements - Schedule of Liabilities Measured on Recurring Basis Unobservable Input Reconciliation (Details) - Private Placement Warrant - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Beginning balance	$ 75	$ 285	$ 166	$ 196
Change in fair value of private placement warrants included in net loss	3	(114)	(88)	(25)
Ending balance	$ 78	$ 171	$ 78	$ 171

Stockholder's Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Class Of Stock [Line Items]
Shares authorized	2,100,000,000
Preferred stock, shares issued	0
Preferred stock, shares outstanding	0
Proceeds from exercise of pre-funded warrants	$ 0	$ 11
Class A Common Stock
Class Of Stock [Line Items]
Shares authorized	2,000,000,000
Common stock, par value	$ 0.0001		$ 0.0001
Common stock, shares issued	27,329,264		27,233,000
Common stock, shares outstanding	27,329,264		27,233,000
Preferred Stock
Class Of Stock [Line Items]
Shares authorized	100,000,000
Common stock, par value	$ 0.0001
Pre Funded Warrants | Class A Common Stock
Class Of Stock [Line Items]
Class of warrants issued	10,700,000
Pre Funded Warrants | Private Placement
Class Of Stock [Line Items]
Proceeds from exercise of pre-funded warrants	$ 90,000

Stock Based Awards - Additional Information (Details) - USD ($) $ in Millions	6 Months Ended		12 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023	Jan. 01, 2024
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock option exercised, intrinsic value	$ 0.1	$ 0.1
Unrecognized stock based compensation expense	$ 0.6
Unrecognized stock based compensation expense, recognition period	10 months 13 days
Fair value of options vested	$ 0.6	1.1
Restricted Stock Units (RSUs) [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vested	96,000
Unrecognized stock based compensation expense	$ 5.7
Unrecognized stock based compensation expense, recognition period	2 years 7 months 2 days
Fair value of options vested	$ 1.8	$ 2.5
Restricted Stock Units (RSUs) [Member] | Employee [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units vesting period	3 years
Restricted Stock Units (RSUs) [Member] | Employee [Member] | Minimum [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units vesting period	3 months
Restricted Stock Units (RSUs) [Member] | Employee [Member] | Maximum [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units vesting period	3 years
Performance-Based Restricted Stock Units [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vested	0
Unrecognized stock based compensation expense	$ 1.9
Unrecognized stock based compensation expense, recognition period	8 months 1 day
Long-Term Incentives (LTI) [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized stock based compensation expense	$ 3.4
Unrecognized stock based compensation expense, recognition period	3 years 5 months 12 days
Class A Common Stock | Restricted Stock Units (RSUs) [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vested	100,000
2021 Equity Incentive plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of Shares Available for Grant	1,877,908
Increase in Share Limit, Reserved for Issuance, Shares				122,360
2021 Equity Incentive plan | Class A Common Stock
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Reserved for issuance of shares under plan			1,755,548
Employee Stock Purchase Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued	0
Number of Shares Available for Grant			175,554
Reserved for issuance of shares under plan	286,802
Employee Stock Purchase Plan | Class A Common Stock
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Increase in Share Limit, Reserved for Issuance, Shares				111,248

Stock Based Awards - Summary of RSU award activity (Details) - Restricted Stock Units (RSUs) [Member] shares in Thousands	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Beginning Balance | shares	250
Granted | shares	900
Vested and settled | shares	(96)
Forfeited | shares	(20)
Ending Balance | shares	1,034
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares	$ 29.77
Weighted Average Grant Date Fair Value, Granted | $ / shares	5.23
Weighted Average Grant Date Fair Value, Vested and Settled | $ / shares	24.6
Weighted Average Grant Date Fair Value, Forfeited | $ / shares	23.97
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 9

Stock Based Awards - Summary of PSU award activity (Details) - Performance-Based Restricted Stock Units [Member] shares in Thousands	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Beginning Balance | shares	119
Granted | shares	0
Vested | shares	0
Forfeited | shares	0
Ending Balance | shares	119
Weighted Average Grant Date Fair Value, Beginning Balance | $ / shares	$ 70.81
Weighted Average Grant Date Fair Value, Granted | $ / shares	0
Weighted Average Grant Date Fair Value, Vested and Settled | $ / shares	0
Weighted Average Grant Date Fair Value, Forfeited | $ / shares	0
Weighted Average Grant Date Fair Value, Ending Balance | $ / shares	$ 70.81

Stock-Based Awards - Summary LTI Awards using a Monte Carlo simulation model (Details) - Long-Term Incentives (LTI) [Member]	6 Months Ended
	Jun. 30, 2024 $ / shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Risk-free interest rate	4.36%
Expected volatility	95.00%
Dividend yield	0.00%
Fair value on grant date	$ 5.08

Stock Based Awards - Summary of Stock Option Activity (Details) - Employee Stock Option - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2024	Dec. 31, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward]
Options, Outstanding at beginning of period	1,078
Options, Granted	0
Options, Excercised	(5)
Options, Forfeited, canceled or expired	(34)
Options, Outstanding at end of period	1,039	1,078
Options, Exercisable	1,000
Options, Vested and expected to vest	1,039
Weighted Average Exercise Price
Weighted average exercise price per share, Outstanding beginning of period	$ 12.04
Weighted average exercise price per share, Granted	0
Weighted average exercise price per share, Exercised	2.95
Weighted average exercise price per share, Forfeited, canceled or expired	18.29
Weighted average exercise price per share, Outstanding at end of period	11.89	$ 12.04
Weighted average exercise price per share, Exercisable	11.57
Weighted average exercise price per share, Vested and expected to vest	$ 11.89
Weighted average remaining contractual term	3 years 8 months 15 days	4 years 3 months 3 days
Weighted average remaining contractual term, Exercisable	3 years 7 months 2 days
Weighted average remaining contractual term, Vested and expected to vest	3 years 8 months 15 days
Aggregate intrinsic value, Outstanding beginning of period	$ 1,686
Aggregate intrinsic value, Outstanding end of period	314	$ 1,686
Aggregate intrinsic value, Exercisable	314
Aggregate intrinsic value, Vested and expected to vest	$ 314

Stock Based Awards - Summary of stock-based compensation expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	$ 3,249	$ 2,055	$ 7,116	$ 3,898
Sales, Marketing and Operating [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	1,129	501	2,305	829
General and Administrative [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	1,995	1,469	4,395	2,913
Technology and Development [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation expense	$ 125	$ 85	$ 416	$ 156

Variable Interest Entities - Summary of Assets and Liabilities Related to VIEs (Details) - USD ($) $ in Thousands		Jun. 30, 2024	Dec. 31, 2023	Jun. 30, 2023
Assets
Restricted Cash		$ 16,092		$ 6,658
Accounts receivable		6,745	$ 9,935
Real estate inventory		307,750	276,500
Prepaid expenses and other current assets		3,545	5,236
Total assets	[1]	406,625	379,694
Liabilities
Accounts payable		2,838	4,946
Total liabilities	[2]	329,058	277,918
Variable Interest Entity [Member]
Assets
Restricted Cash		16,092	3,867
Accounts receivable		3,203	6,782
Real estate inventory		307,750	276,500
Prepaid expenses and other current assets		407	1,588
Total assets		327,452	288,737
Liabilities
Accounts payable		1,903	1,798
Accrued and other current liabilities		1,757	2,027
Secured credit facilities and other debt, net		303,786	257,224
Total liabilities		$ 307,446	$ 261,049
[1] Our consolidated assets as of June 30, 2024 and December 31, 2023 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $16,092 and $3,867; Accounts receivable, $3,203 and $6,782; Real estate inventory, $307,750 and $276,500; Prepaid expenses and other current assets, $407 and $1,588; Total assets of $327,452 and $288,737, respectively. [2] Our consolidated liabilities as of June 30, 2024 and December 31, 2023 include the following liabilities for which the VIE creditors do not have recourse to Offerpad: Accounts payable, $1,903 and $1,798; Accrued and other current liabilities, $1,757 and $2,027; Secured credit facilities and other debt, net, $303,786 and $257,224; Total liabilities, $307,446 and $261,049, respectively.

Earnings Per Share - Summary of Components of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Net loss		$ (13,782)	$ (22,344)	$ (31,297)	$ (81,791)
Weighted average common shares outstanding, basic		27,385	27,258	27,362	25,470
Dilutive effect of stock options	[1]	0	0	0	0
Dilutive effect of restricted stock units	[1]	0	0	0	0
Weighted average common shares outstanding, diluted		27,385	27,258	27,362	25,470
Net loss per share, basic		$ (0.5)	$ (0.82)	$ (1.14)	$ (3.21)
Net loss per share, diluted		$ (0.5)	$ (0.82)	$ (1.14)	$ (3.21)
Stock Options [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from diluted loss per share:	[1]	927	1,029	950	1,048
Restricted Stock Units [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from diluted loss per share:	[1]	138	69	134	75
Performance-Based Restricted Stock Units [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from diluted loss per share:		119	127	119	127
Warrants [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from diluted loss per share:		1,452	1,452	1,452	1,452
[1] (1) Due to the net loss during each of the three and six months ended June 30, 2024 and 2023, no dilutive securities were included in the calculation of diluted loss per share because they would have been anti-dilutive.

Earnings Per Share - Summary of Components of Basic and Diluted Earnings Per Share (Parenthetical) (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Earnings Per Share [Abstract]
Dilutive Securities, Effect on Basic Earnings Per Share	$ 0	$ 0

Income Taxes - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Tax Examination [Line Items]
Income tax benefit (expense)	$ 54	$ (43)	$ (69)	$ (165)
Company's effective tax rate	0.40%	0.20%	0.20%	0.20%
Company's federal statutory rate	21.00%		21.00%
Valuation allowance	$ 111,000		$ 111,000
Minimum
Income Tax Examination [Line Items]
Income tax benefit (expense)	$ 100	$ 100	$ 100	$ 200

Related Party Transactions - Additional Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) Facility	Jun. 30, 2023 USD ($)
Related Party Transaction [Line Items]
Interest Expense	$ 4,581	$ 1,867	$ 9,486	$ 9,299
Operating Costs and Expenses	222	220	574	988
First American Financial Corporation | Related Party [Member]
Related Party Transaction [Line Items]
Operating Costs and Expenses	1,500	1,600	$ 3,200	4,300
Senior Secured Credit Line
Related Party Transaction [Line Items]
Number of Facilities | Facility			1
Mezzanine facility
Related Party Transaction [Line Items]
Number of Facilities | Facility			2
LL Mezz Loan Agreement
Related Party Transaction [Line Items]
Maximum principal amount	$ 70,000		$ 70,000
L L Funds Loan Agreement | Class A Common Stock
Related Party Transaction [Line Items]
Ownership percentage	5.00%		5.00%
L L Funds Loan Agreement | Senior Secured Credit Line
Related Party Transaction [Line Items]
Maximum principal amount	$ 50,000		$ 50,000
L L Funds Loan Agreement | Mezzanine Secured Loan
Related Party Transaction [Line Items]
Maximum principal amount	$ 22,000		$ 22,000
First Funding Inc.
Related Party Transaction [Line Items]
Ownership percentage	5.00%		5.00%
First American Credit Agreement [Member] | Class A Common Stock
Related Party Transaction [Line Items]
Ownership percentage	5.00%		5.00%
LL Capital Partners I, L.P
Related Party Transaction [Line Items]
Interest Expense	$ 800	$ 700	$ 1,800	$ 2,200

Related-Party Transactions - Summary of Credit Facilities as Related Parties (Details) (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2024	Dec. 31, 2023
Senior Secured Credit Facility With a Related Party
Related Party Transaction [Line Items]
Borrowing Capacity	$ 50,000	$ 50,000
Outstanding Amount	10,284	6,289
Mezzanine Secured Credit Facilities With a Related Party
Related Party Transaction [Line Items]
Borrowing Capacity	92,000	92,000
Outstanding Amount	$ 21,615	$ 23,803

Related-Party Transactions - Summary of Related Parties (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Related Party Transaction [Line Items]
Operating Costs and Expenses	$ 222	$ 220	$ 574	$ 988
Brother 1 | Related Party [Member]
Related Party Transaction [Line Items]
Operating Costs and Expenses	99	99	262	468
Brother 2 | Related Party [Member]
Related Party Transaction [Line Items]
Operating Costs and Expenses	92	92	245	440
Sister-in-law | Related Party [Member]
Related Party Transaction [Line Items]
Operating Costs and Expenses	$ 31	$ 29	$ 67	$ 80

Related-Party Transactions - Grants of Equity Awards to Related Parties (Details)	6 Months Ended
	Jun. 30, 2024 shares
Restricted Stock Units (RSUs) [Member]
Related Party Transaction [Line Items]
Granted	900,000
First American Financial Corporation [Member]
Related Party Transaction [Line Items]
Granted	88,500
First American Financial Corporation [Member] | Brother 1
Related Party Transaction [Line Items]
Granted	42,500
First American Financial Corporation [Member] | Brother 2
Related Party Transaction [Line Items]
Granted	40,000
First American Financial Corporation [Member] | Sister-in-law
Related Party Transaction [Line Items]
Granted	6,000

Commitments and Contingencies - Additional Information (Details) $ in Millions	Jun. 30, 2024 USD ($) Home
Commitments and Contingencies Disclosure [Abstract]
Contract to purchase homes | Home	359
Aggregate purchase price | $	$ 102.7

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