Zillow Stops Home Buying Business Drops 25%

Zillow mentioned this week they will be exiting buying and flips of homes, (started in December 2019) eliminating 25% of its workforce.

As Quoted by Zillow CEO Rich Barton; "We've determined the unpredictability in forecasting home prices far exceeds what we anticipate...Continuing to scale Zillow offers would result in too much earnings and balance sheet volatility."

Additionally, Barton said the Offers product reaches a small niche audience. At the end of the day Real Estate is a personal business. Relationships and local insight/experience provide the greatest results.

Zillow’s internet, media and technology business grew revenue 16% in the quarter to $480 million, with gross profit of just over $130 million.

The home flipping proved to be a hassle which the inability to predict home prices for the future 6 months. Bloomberg reported on Monday that Zillow was looking to sell 7,000 homes for $2.8 billion to institutional investors, as it looked to unload its portfolio of properties.