A Comprehensive Timeline of Zillow's Misadventures in iBuying

November 3, 2021
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Yesterday's bombshell announcement that Zillow's is shuttering its iBuying division and laying off 25% of its staff over the next few quarters brings to an end three and a half years of a turbulent and experimental business.

We look back on a moonshot that was never profitable, was susceptible to a fluctuating market that saw "black swan" events and which frequently generated headlines in the industry press...


May 2017

Zillow launches an “instant offers” pilot in Orlando and Las Vegas. The pilot lets homeowners receive cash offers from “select investors” as well as a market appraisal from regional agents to see what the house would be worth on the open market.


April 2018

The company pivots to start actually buying homes, a move that puts it in direct competition with Opendoor. The first home the company ever bought was this 4 bedroom bungalow in Arizona. The firm would go on to purchase 19 homes in the Phoenix area in the quarter.

CEO Spencer Rascoff says: “At this exciting time in the real estate industry, Zillow Group is committed to developing innovative technology and services, like Zillow Offers and, with today's announcement, potential for mortgage originations, that help our partners meet evolving consumer expectations, while generating more revenue opportunities."


November 2018

The first quarterly report for Zillow’s newly formed Homes segment. The company purchased 168 homes and sold 36 homes through Zillow Offers generating $11 million in revenue in the quarter.


February 2019

With co-founder Rich Barton now at the helm, Zillow claims that the Homes business can generate “$20 billion in annual revenue” in three to five years buying 5,000 homes per month and achieving a 33% mortgage attach rate.


March 2020

After ramping up the volume of homes bought and expanding to 24 markets nationwide, Zillow pauses its iBuying activities as the economic impact of the coronavirus hits home.


May 2020

The company’s Q1 results reveal that for the first time, the Homes segment made a profit. This was because the firm sold 2,394 homes but only purchased 1,479 homes in the first quarter due to the pandemic.

The company also announces that it will resume iBuying activity in three markets with Barton confident that what he terms “the great reshuffling” will be good for business. A company report predicts that “Prices will return to Q4 2019 levels by Q3 2021” 

Zillow Homes Segment Revenue And Adjusted Ebitda Performance


July 2020

Zillow Homes partners with homebuilder D.R. Horton to market its solution to those selling their old houses to move into new D.R. Horton homes. Efforts are made to ramp up iBuying activity to compete with Opendoor and other market entrants such as Offerpad and Redfin.


September 2020

Now back up and running in 25 markets, Zillow announces the controversial move of hiring full-time salaried Zillow agents to work at its iBuying division. The user-experience considerations cited by the company did not wash with the majority of US realtors who saw the decision as an aggressive move into their territory. 


October 2020

Geekwire reports that Zillow has laid off 80 staff from its iBuying operations, highlighting the fickle and dynamic nature of the business. Details about the lay-offs are scant with the company only offering a perfunctory email statement to the publication:

“The changes in our team, while never easy, will put us in a strong position to continue investing in Zillow Offers for the long term by realigning our resources and staffing levels to best meet the evolving needs of our customers,” 


February 2021

Zillow records record revenue despite an iBuying slowdown. The company’s share price hits $203 per share on the back of its Q4 results announcements. 

Subdued levels of iBuying across the year meant that the company's balance sheet for 2020 reflected the same $241 million loss for the Homes segment as it did in 2019.”

Zillow also makes the bold move of putting its money where its Zestimate is and giving instant iBuying offers to consumers based on their home’s Zestimate.


September 2021

A bad PR week for the Zillow brand as the company is ostensibly the subject of a viral TikTok video in which a realtor hypothesises about an unnamed iBuyer artificially elevating home prices for profit. Zillow emails a statement to Inman.com citing "misinformation and falsehoods" in the video.

@seangotcher#housing♬ San Tropez - Illect Recordings


October 2021

Zillow confirms that it has paused its iBuying activities citing “operational capacity” issues around labour and materials. 

There is speculation by industry commentators that falling house price appreciation means that the company is taking a big loss on its inventory. 


November 2021

A “tough day” at Zillow as Rich Barton uses the company’s Q3 results presentation to announce that the firm will be winding down its iBuying operations and laying off 25% of its staff. The Homes segment, while contributing to enormous revenue, is ultimately dragging Zillow's bottom line down too far for management to tolerate.

"Fundamentally, we have been unable to predict future pricing of homes to a level of accuracy that makes this a safe business to be in" he said as the Homes segment took an Adjusted EBITDA loss of $380 million.

November 3, 2021
Since March 2020 Edmund's job has been to read about, write about, collect data on, analyse and generally know about real estate marketplaces and the companies that run them. Before that he worked at the aggregator Mitula Group (which became Lifull Connect) for five years.

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