Before Zillow signs a contract to buy a house, it sends an inspector to make sure the property doesn’t need costly repairs. The iBuying process is powered by algorithms and large pools of capital, but it’s also reliant on humans. With the pandemic setting off a housing frenzy marked by cash bids and fast closings, Zillow’s pitch of speed and convenience has started to resonate with consumers who want to sell their homes quickly as they try to buy a new property. If an owner accepts, Zillow buys the property, makes light repairs and puts it back on the market. In the new business, Zillow invites homeowners to request an offer on their house and uses algorithms to generate a price. In 2018, the company launched Zillow Offers, joining a small group of tech-enabled home-flippers known as iBuyers. Why Zillow Went From Online Real Estate Ads to Flipping Homesīut more recently, it has been buying and selling thousands of U.S. The popularity of the company’s apps and websites fuels profits in Zillow’s online marketing business. Zillow is best known for publishing real estate listings online and calculating estimated home values – called Zestimates – that let users keep track of how their home is worth. “We continue to process the purchase of homes from sellers who are already under contract, as quickly as possible.” “We are beyond operational capacity in our Zillow Offers business and are not taking on additional contracts to purchase homes at this time,” a spokesperson for Zillow said in an email. Zillow, which acquired more than 3,800 homes in the second quarter, will stop pursuing new home purchases as it works through a backlog of properties already in its pipeline. homes after the online real estate giant’s pivot into tech-powered house-flipping hit a snag. I think the worry is if this situation doesn’t improve in the next several months, we might see scores of foreclosures flood the market, which could lead to lower home prices.Ĭonversely, if the government and loan servicers get ahead of it and work hard to help unemployed homeowners, things might turn out okay.Īnd really, with all the spending going on, there’s bound to be inflation, which could benefit homeowners as the world recovers.(Bloomberg) - Zillow Group Inc. If billion-dollar companies like Redfin and Zillow aren’t interested in buying our homes, what does that say about the health of the real estate market? However, a bigger concern is if this is the canary in the coal mine. It certainly can be argued as essential in certain situations. One issue, as mentioned by Zillow, is that real estate isn’t necessarily an essential business activity.Īt least when it involves investors trying to make money by buying and selling real estate.įor everyday Joes looking to buy or sell a home, I assume it’s still okay to do so.

So there’s a good chance they are following suit and putting new purchases on hold as well.Īs reported last week, RedfinNow was the first to temporarily halt home purchases, as indicated in an 8-K filing.

We appreciate your flexibility during this time.: “We need to ensure that all services, including third parties, associated with a customer’s purchase or sale will be available. “To ensure that our customers, employees, and third parties are safe to the best of our ability, our processes have been subject to temporary changes.” However, they do have an “important notice” posted at the top of their website that reads: I visited Offerpad’s website to see how they were being impacted, but couldn’t get a totally clear answer.

You can also use one of their partner real estate agents to list your home in traditional fashion, though I think we all know selling right now probably doesn’t make a ton of sense unless absolutely necessary. They said they’ll get back to customers via email within 2-3 days if eligible.

Zillow pauses home purchases