What Arizona Homebuyers Can Expect Now As Zillow Leaves Home Flipping Business | Arizona News
PHOENIX (3TV / CBS 5) – Zillow decided to stop buying houses and reselling them. It comes as the company claims it is unable to accurately predict house prices.
Zillow is known as a place to check out homes for sale in your area, but people have been able to sell their homes to the business over the past couple of years. It will no longer be an option. The company reported a net loss of more than $ 328 million in the third quarter, all related to its home buying unit. Now Zillow has decided to go back to her roots.
Zillow slows down home buying as he struggles to manage inventory backlog
“In the end, I think it was a great test for them, and now they’re going to hopefully go back to their roots of what got them to where they are today, which is – say easy access to knowledge and information, “Phoenix Realtor and CEO of The Karas Group said Chris Karas. “There is only a limited amount of information you can get from an algorithm and robot-human interaction,” Karas said.
The company’s home buying business, called Zillow Offers, started a few years ago, allowing homeowners to sell on Zillow for cash rather than going through a broker and dealing in a closing process. After buying a house, Zillow would invest in repairs and maintenance and try to sell it for a profit. But during the pandemic, workers were harder to find and the cost of supplies rose dramatically, and Zillow found himself in trouble. The company is now pulling out of buying and selling activities, saying it made the move because it is unable to accurately predict house prices.
“I 100% congratulate them for trying something new,” Karas said. The Arizona real estate market is unlikely to feel any impact. According to Karas, of the 25 markets in which the company did business, Zillow had less than one percent of the market share. Karas added that some people are willing to take less because of the convenience factor provided by companies like Zillow, Offerpad and Opendoor, but he says traditional buying and selling will be your best bet.
“At the end of the day, real estate was built on the interaction between two people and hiring that expert in the field and someone who specializes and is an expert in this field,” said Karas.
In a statement, Zillow said they are still closing homes they are under contract to and preparing them for sale. They will then put them back on the open market. As a result of this change, Zillow will lay off a quarter of the real estate company’s employees, or around 2,000 employees.