Zillow's money pit
One of the biggest headlines of 2021 is that Zillow shut down their iBuying operation, Zillow Offers, which "flipped" homes for a profit. They discovered that correctly valuing property and anticipating the market is difficult, and certainly not a job for a computer. Scaling and automation may work for selling books, music or widgets online, but seems far off on homes, the most complex asset and transaction most folks ever deal with. Zillow CEO Rich Barton said "We've been unable to accurately forecast future home prices at different times in both directions by much more than we modeled as possible." Losses in Q4 2021 alone may approach $1billion. Many agents and sellers saw this happening.
The issues for Zillow or any so-called iBuyer, are the same as for any buyer or seller. They include judging a home's appeal, a home's condition relative to competing homes, a buyer's motivations and needs, the timing of a buy or a sale, and much more. A skilled agent will be able to make sophisticated assessments that an institution or a computer struggles with.
Still, Zillow will stick around with their deep pockets and desire to control data and the buy/sell process. They'll find other ways. The primary lesson going forward is that Zillow is out for THEIR bottom line. As an agent we act as a fiduciary and are out for YOUR bottom line. True yesterday, today and tomorrow.
Call to find out more about how we do that.
The Hasson Company
15400 SW Boones Ferry Road
Lake Oswego 97035