”Zillow Offers”...Homes to Investors, Not Homeowners

For the past couple of years, the website Zillow has expanded their business model into the home speculation and flipping game. The “Zillow Offers” program offers cash for homes, followed up by Zillow going in and implementing home renovations—and the company planned to do this with thousands of homes in 2021.

Yet now, two months before the year has even ended, Zillow announced that not only would it no longer be buying homes, but it also needs to offload thousands of the homes it did buy —and not to homeowners and landlords, but to institutional investors. Additionally, the company will be laying off 25% of its workforce, and estimates that it’ll lose over half a billion dollars.

Why? That’s the question on today’s episode of Upzoned: Using a recent article from The Verge as a springboard for discussion, host Abby Kinney and regular co-host Chuck Marohn discuss the possible reasons why Zillow has had to reverse course on its foray into the home-flipping business.

Additional Show Notes

• “Zillow reportedly needs to sell 7,000 houses after it bought too many,” by Mitchell Clark, The Verge (November 2021)

• Check out this 2019 episode of Upzoned that covered Zillow’s decision to start getting into the home-flipping business.

• Abby Kinney (Twitter)

• Charles Marohn (Twitter)

• Theme Music by Kemet the Phantom