Zillow Stopped Buying Homes
Zillow has stopped buying homes.
You’ve seen the articles, you’ve heard the news going around. But what really happened?
First, understand that Zillow is an i-buyer. They offer instant offers online [typically lower than market value] to sellers as investors. They then ‘fix it up’ and put it back on the market.
However, where they went wrong was here...
They did not know the true market value of the home they were purchasing or how to accurately estimate it. Wait, what was that? What about the zillowesimates?
Don’t worry, I'll get to that!
What Zillow was doing was buying properties at a wayyyy high price with no knowledge of where the value really lies. Then spapping lipstick on a pig and putting it back on the market not even a few months later for even more money.
Zillow's CEO stated that they have determined the unpredictability in forecasting home prices far exceeds what they anticipated. [aka they were trying to minuplate the market and it didn’t work out in their favor]
So what was a RED HOT market-now being just a hot market, they are now sitting on about 7,000 homes that are worth way less than what they paid for them, and just in the last quarter of 2021, they have lost 330 billion dollars...
So they are now cutting their losses, taking a break, and hopefully going back to doing what they do best, which isn’t trying to manipulate the market...
And to wrap this up with my two scents…
Don’t rely on Zillow estimates as you see-they are not accurate! Hire a local real estate professional because they are the only ones that can truly tell you what your local market is doing... not Zillow.
Want to get in contact with a local real estate expert? Give us a shout!
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