In any other circumstance, Opendoor Technologies (NASDAQ:OPEN) stock may have been a no-brainer investment.

As you probably know, owning real estate is the epitome of the American Dream — but the paperwork to seal the deal is a veritable nightmare.

Opendoor’s digitalization of the buying and selling process is the answer we’ve all been seeking.

So then, what the heck happened? After getting off to an auspicious start, OPEN stock hit a closing peak of $35.88 on Feb. 11 of this year.

Since then, shares have dropped more than 58% at the time of writing. Adding to the sentiment woes, Cathie Wood’s ARK Next Generation Internet ETF (NYSEARCA:ARKW) has been busy offloading OPEN shares over the last few months.

To be fair, the social media crowd interprets this move as a positive development.

Based on a random sampling of posts, it appears that most people feel the worst of the selloff is over. Therefore, OPEN stock is finally free to swing higher again.

Certainly, I can appreciate this narrative from two angles.

First, the social media crowd has earned everyone’s respect, at least for the time being. As I mentioned in my analysis of community-favorite Castor Maritime (NASDAQ:CTRM), you should at least be aware of the “Collective power of the internet.”

Second, Opendoor has fundamentals to support at minimum a modicum of its equity unit’s enthusiasm.

For instance, the ability for homeowners to sell directly to Opendoor is intriguing not only for skipping the hassles of showcasing the home, the platform also allows said homeowners to move out exactly when they want to.

If you’ve ever dealt with the stress of moving cross-country for a job and wanted to avoid the prospect of double mortgage payments, you know how valuable this service is.

Quality of Revenue May Hurt OPEN Stock

Nevertheless, having witnessed the earlier carnage in OPEN stock prospective buyers will ask themselves whether the fundamentals are enough. Honestly, I think it’s a questionable proposition.

While the hyper-intense housing market supported Opendoor Technologies through greater demand, it also hurt the company.

For instance, with the pandemic-fueled lockdowns and mitigation protocols, millions of high-paid workers have been operating remotely. Many still are, suggesting that the core of the housing market have much more time on their hands than ever before.

So what does it matter that Opendoor offers its convenient services? With time not nearly as important a factor today, wouldn’t prospective sellers opt for the higher dollar offer, irrespective of the platform undergirding that offer?

I mean, a million dollars processed digitally or manually wouldn’t matter in the end: you’ve got a million dollars now.

This segues into the quality of revenue for OPEN stock. By that, I mean, what’s the expectation that Opendoor’s recent revenue surge will recur well into the future? Based on its first quarter of 2021 earnings report, that expectation dimmed considerably.

Now, that’s just one report so it’s premature to get too worked up about it. However, consider the S&P/Case-Shiller U.S. National Home Price Index on a percent-change-from-year-ago basis.

You can see that outside the extreme ebb-and-flow of economic impacts, a standard healthy growth rate in the index ranges from roughly 2% to 6%.

As of the latest read in April, we’re talking nearly 14.6%, an all-time record. Further, the way that the metric shot up from June 2020 is unprecedented.

Simply, I don’t think this ravenous demand for housing is sustainable, and that’s deeply problematic for OPEN stock because the underlying company can’t depend on future revenue trends sustaining itself.

Not a Hater, Just a Realist

Hopefully, you didn’t interpret my take on OPEN stock as hating on Opendoor. As I mentioned, the company provides excellent services which help make the housing process efficient. Perhaps its technologies can democratize the real estate industry.

But for now, it seems that the timing of OPEN’s introduction is a double-edged sword. Yes, it received an initial boost of demand. But is this sustainable?

Based on Case-Shiller housing index, I don’t think it is. That’s what makes OPEN stock risky — it’s about the numbers, not about opinions.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.