patrick.net

A report from Bloomberg. “Zillow’s iBuying business loses money, so stopping purchases should help its bottom line, analyst Ygal Arounian said in a note. ‘This feels like they bought way too many homes and they’re trying to work off that excess supply,’ said Jonathan Miller, president of appraisal firm Miller Samuel.”

From CNN Business. “iBuyer share in some cities, like Phoenix, Atlanta or Charlotte, North Carolina, now tops 5%. ‘Zillow just kept barreling down and now they’ve hit this wall,’ said Mike DelPrete, an independent real estate technology strategist. This is not the situation a growth-focused company wants to be in, he said. ‘If you’re trying to be number one in the market, slamming on the brakes is one of the worst things you can do,’ said DelPrete.”

From KLKN on Nebraska. “It was a housing market frenzy just a few months ago with homes getting snatched up within hours and lots of buyers being forced to make some tough and risky decisions. ‘One of the terms that would be tossed out to be more competitive earlier this spring was to waive inspections. So, they were just buying the house as is, not doing an inspection, you just get what you get. That was a little scary,’ Melanie Dawkins, with Red Door Realty, said.”

“The Lincoln housing market has turned the corner and things are looking up for buyers and sellers. Dawkins says it’s technically still a sellers market but things have slowed down substantially and given everyone more time to think about their decisions. ‘Right now, I can say we’re gonna go look at a handful of these. You can think about them overnight, let’s talk about it tomorrow and see what you think of it. That’s a lot better for making such an amazingly huge decision. This is the most expensive purchase you’ll ever make,’ Dawkins said.”

http://housingbubble.blog/?p=5263

My understanding of Zillow's buy and flip arm is, they count the future necessary repairs as part of their "buy price" which artificially humps retail housing prices ever higher. Works a treat while the bubble is growing and they're flipping lots of homes at bubble inflated prices while buying distressed low on the back end. Can fall the F apart quickly once the bubble bursts. Hard to say if this isn't anticipating the usual winter slowdown of retail home sales, or is the beginning of a long term slide in housing prices.

Zillow definitely pumping air into the real estate bubble the way they report the "purchase price" of their flipper homes.

I wish Zillow would offer a service here in silicon valley. From what I can see of the standard real-estate agents, Zillow couldn't be worse. At least the bait-and-switch tactics would happen more quickly and more directly.

Does anyone think there might be a huge scramble of California sellers wishing to lock in the current capital gains tax rates? I've been thinking that federal long-term capital gains may increase 10 percentage points, costing me an additional $100k.

Fox 10 Phoenix in Arizona. “There has been a bit of a jolt to the real estate market, as Zillow announced it is halting its home buying program, called Zillow Offers, in Phoenix and other cities. ‘Zillow’s inventory has grown 1,000% since last year in Phoenix. Just in Phoenix,’ said Tina Tamboer, a Senior Analyst with The Cromford Report. ‘When they purchase a home, they have to sell it right away,’ said Tamboer. ‘Sometimes, you have to wait for that inventory to dissipate.'”

The Boston Globe. “The Greater Boston Association of Realtors, which tracks activity in 64 cities and towns in Eastern Massachusetts. It said the typical single-family home sold for $750,000 in September, a record for the month and up 10 percent from September 2020, but down 4 percent from August and the lowest median price in six months. That plateau comes as sales volume slows, particularly for single-family homes, which fell 13 percent from the same time last year, even as listings trended upward at the start of the traditionally busier fall season.”

A report from Pleasanton Weekly in California. “Buyer behavior has shifted during the second half of 2021 and is likely to continue into next year said Tina Hand, 2021 president of the Bay East Association of Realtors. Hand said buyers are backing off and sellers aren’t used to that. Asked how sellers are responding, Hand said, ‘I think they are a bit surprised that they aren’t getting the prices we were seeing even as recently as August and the beginning of September. They haven’t quite woken to the fact that the market is shifting. Sellers had been getting 15 or 20 multiple bids going $200,000 to $400,000 over the asking price, and that’s not happening,’ she said.”

“From August to September, the median sales price for a single-family home in Pleasanton dropped from $1.79 million to $1.56 million. Hand said, ‘There’s talk about a ‘housing bubble’ but the factors just aren’t there; this is not 2008. What happened then is not going to happen in 2021.'”

joshuatrio says

“From August to September, the median sales price for a single-family home in Pleasanton dropped from $1.79 million to $1.56 million. Hand said, ‘There’s talk about a ‘housing bubble’ but the factors just aren’t there; this is not 2008. What happened then is not going to happen in 2021.'”

"This time it's different!"

A report from WTOP. “About 1 million U.S. homeowners with a mortgage are still in some stage of a mortgage payment forbearance program with their lender. The current rate of delinquencies at all stages is 3.5%, and that is historically high. ‘The last time we saw this high of a level was back in 2008 and 2009 during the financial crisis. But what is different this time is that the foreclosure rate is at a historic low because of the forbearance program,’ said Lawrence Yun, chief economist at the National Association of Realtors.”

joshuatrio says

said Lawrence Yun

Lawrence Yun? When it comes to wrong predictions, that fellow is a hole with no bottom.

HeadSet says

When it comes to wrong predictions, that fellow is a hole with no bottom.

Now, just what gender would that be?

HeadSet says

joshuatrio says

said Lawrence Yun

Lawrence Yun? When it comes to wrong predictions, that fellow is a hole with no bottom.

Paid shill.

A report from Gizmodo. “Zillow has been hemorrhaging cash in the home-buying arms race in certain markets. Bloomberg wrote: ‘Zillow put a record number of homes on the market in September. It also cut prices on nearly half of its U.S. listings in the third quarter.’ In some markets like Atlanta, Georgia, and Phoenix, Arizona, Zillow losing money on listings is particularly apparent, Bloomberg wrote. Its 250 active listings in Phoenix are about 6% under market price, which University of Colorado Boulder real estate expert Mike DelPrete told Bloomberg was about $29,000 off for the typical home.”

https://www.msn.com/en-us/money/realestate/zillows-flips-are-now-flops/ar-AAQ0OPg

zzyzzx says

I guess they got tired of losing money on their home purchases.

It's hysterical. Every single one in my area that is listed is now listed for below what Zillow paid for it. ALL OF THEM!!!!

Here is an interesting NY Post story giving a little detail into what we noticed.

https://nypost.com/2021/10/28/zillows-flips-flop-hurting-profits-but-benefitting-homeowners/

After a real estate agent made him a lower offer than Zillow, Richard Flor of the Phoenix suburb Tolleson, Arizona decided to sell to the company this summer. Zillow paid him approximately $412,000 and charged only a 1 percent fee on the sale of his three-bedroom, three-bathroom rental property. Two weeks later, after making light repairs, Zillow listed the property for $387,000 — $3,000 less than what the agent had offered.

https://finance.yahoo.com/m/94fb431f-7378-387c-a3bf-b4b668eb223d/zillow-stock-dives-after.html

Zillow stock dives after analyst highlights two-thirds of homes bought are underwater

zzyzzx says

https://finance.yahoo.com/m/94fb431f-7378-387c-a3bf-b4b668eb223d/zillow-stock-dives-after.html

Zillow stock dives after analyst highlights two-thirds of homes bought are underwater

That's a good news for now. But give inflation and money creation its just a pause.

Here's one of their competitors in the iBuyer space:
Instant homebuyer Offerpad quietly became a publicly traded business Thursday, after it merged with a blank check company led by former Zillow CEO Spencer Rascoff one day earlier.
...
Rascoff departed from Zillow in early 2019, due in part to criticisms he didn’t bring the home listings giant into iBuying at a rapid enough pace. A spokesperson for Rascoff reached out to say that he did not step down as CEO due to disagreements over Zillow’s iBuying program.*
..
Offerpad turned a $9.2 million profit in second quarter, a rare feat in iBuying in which the cost to purchase homes plus operating expenses traditionally exceed revenues from reselling the home. But Bair acknowledged last month that Offerpad would likely lose money the next two quarters thanks to increased marketing costs and ramping up its engineer and product teams.
Veering into Change Bank model of profitability. Could be a boon for home buyers, though. Investor capital used to fix up homes that are sold at a loss.

This is not news, but: https://www.zerohedge.com/markets/zillow-scrambles-punt-7000-homes-28-billion-ai-flipping-scheme-ends-disaster

Way to call this one early Malcolm...
The company plans to take writedowns of as much as $569 million and reduce its workforce by 25% as it winds down the business in coming months, according to a statement Tuesday. Zillow shares plunged as much as 11% to $76.22 in late trading.
The decision to abandon home flipping comes as the company’s third-quarter results showed it lost more than $380 million in the operation, called Zillow Offers. The business hit a major snag in recent months as Zillow tweaked its algorithms to make more aggressive offers, causing it to overpay for houses just as the heated U.S. market began to cool slightly.

Fucking morons snorted their own product.

Here's the Big Four Three iBuyers.
The iBuying industry is still relatively small, but it's starting to gain serious traction. A recent report by Zillow analyzed the "big four" iBuyers: Zillow, Offerpad, Opendoor, and Redfin (NASDAQ: RDFN). It found that the four companies purchased a total of more than 15,000 homes in the second quarter of 2021 and that iBuying accounted for 1% of the U.S. housing market for the first time ever.

https://finance.yahoo.com/m/cde86b19-937a-3952-babe-2fae3c07f344/zillow-is-offloading-7-000.html

Zillow is offloading 7,000 homes — raising ‘red flags’ about the real-estate market

My all-time favorite real estate quote: “We’ve determined the unpredictability in forecasting home prices far exceeds what we anticipated and continuing to scale Zillow Offers would result in too much earnings and balance-sheet volatility,” said CEO Rich Barton in a statement.

https://therealdeal.com/2021/11/02/zillow-calls-it-quits-on-ibuying-will-lay-off-25-of-staff/

So, that begs the question. If Zillow can't forecast home values, isn't that a problem for those who rely on Zillow forecasts?

$65.47/sh -21.73 (-24.92%)
At close: 4:00PM EDT

Wow.

Zillow bought houses in shit areas for shit prices cause their "AI" told them so. This is not a red flag for the real estate market, it just once again proves how much better humans are at activities that require instinct such as house flipping

Seattle-based Zillow faces another shareholder suit over failed house-flipping business

https://www.seattletimes.com/business/real-estate/seattle-based-zillow-faces-another-shareholder-suit-over-failed-house-flipping-business/

It looks like this is going to keep haunting them for years.

Thanks @Malcolm

I'm happy to hear that Zillow is still going downhill. I did not enjoy working for them, especially not after they figured out that I'm the patrick.net guy.

Patrick says

especially not after they figured out that I'm the patrick.net guy.

What was THAT like? haha

Yes, I was ultimately fired, no reason given. But I knew.

just_passing_through says

What was THAT like? haha

It was fun at first, like being a secret agent. But later it was just uncomfortable.

Patrick says

I'm happy to hear that Zillow is still going downhill. I did not enjoy working for them, especially not after they figured out that I'm the patrick.net guy.

Awkward!!!!!

Patrick says

Yes, I was ultimately fired, no reason given. But I knew.

When was that?

2017

Patrick says

Yes, I was ultimately fired, no reason given. But I knew.

How did they find out?

Patrick says

Yes, I was ultimately fired, no reason given. But I knew.

Congratulations! I figure that there is probably something wrong with you if you haven't been fired at least once!

Zillow down to 34.69 / sh.

zzyzzx says

They did shut it down many months ago.

RWSGFY says

zzyzzx says

They did shut it down many months ago.

Did they shut it down, or just turn it clockwise (to tighten, instead of loosing).