Zillow extorts money from realtors ads with information the realtors gave them. Now they are charging $10/week for rentals ads. The tenant leads Zillow provides to landlords are basically useless. Just like the leads realtors get. I have never had a successful tenant lead from Zillow. Craigslist is the best. I may have to explore Nextdoor and Facebook also. But Zillow is shit.
Zillow is gunning to be the RE company in the country. In additional to taking ad dollars from desperate agents, Zillow is now eating their lunch as well.
Is Zillow going to be the Walmart of the Real Estate, or Macy of the Real Estate?
Removing agents is the next disruption waiting to happen in real estate soon. Same like Tesla removing dealers.
Removing RE agents will just bring out the lawyers. In fact in many states lawyers are already involved in transactions. Just look at the length of a CAR contract. Most lawyers even can’t understand it.
When my parents bought a house in 1961 the contract was shorter than a automobile purchase agreement. 1/2 page . Now it is over 10 pages with hundreds of pages of disclosures.
Agents don’t understand every single detail of those contracts either. Paying 5% just to sell a house is highway robbery.
If you think RE agents are expensive wait till the lawyers take over. Try buying in Mexico. No MLS. 8% commissions. Huge notary fees. No transparency. No disclosure protection. Huge cap gain taxes on inflated money.
Zillow Pauses Home Purchases as Snags Hit Tech-Powered Flipping
Online listing giant bought 3,800 houses in second quarter
Email says iBuyer operation has ‘hit its capacity’ for 2021
It’s a high capital and low margin business. I don’t see how it can scale given the capital and staffing to project manage the property updates.
The shortage of inventory makes finding deals difficult. Why flip? Buy and hold makes more sense.
The market is going up. They may have overpaid. But in 6 months all their flips will be Golden.
“The shift has been on display in places such as Atlanta and Phoenix, two markets where home prices have been surging. Zillow’s roughly 250 active listings in Phoenix are currently priced at 6% less, on average, than what the company paid for the homes.”
That doesn’t even count if they spend any money on the homes. I thought they were supposed to be doing light updates (paint and flooring). This is just another “tech” thing that’s not at all tech. It’s a capital intensive and low margin business.
Phoenix prices are going up fast. They should change their business model. Rent them out and sell in five years. Predicting 24% price appreciation in one year.
I see similar listings in Sacramento and Austin area, they probably paid a lot and now selling them for less than they paid.
If they switch SFR, it might work out much better in the long run. But that’s capital heavy and would probably crush their stock.