Back in March, iBuyer schemes across America halted as uncertainty surrounding that particular business model arose. Companies like Zillow, Redfin, Offerpad, and Opendoor wondered whether iBuying would be able to survive the pandemic and come out on the other side.
Zillow CEO Rich Barton shed some light on the Zillow Offers, the market as a whole, and the future of iBuying.
Zillow reported that its Q1 earnings showed a revenue increase of 148% year-over-year and Zillow Group stock is now trading at $57 a share, up more than 25% since January 2020.
Barton has stated that this industry crisis differs greatly from the 2008 recession.
“That is due to the industry getting a lot smarter. We are a more robust industry now than we were then.”
Demand is higher than anticipated, as well. Barton explained that secondary market transactions have stayed around the 5.5 million mark since the global financial crisis.
Now that things with the pandemic are on the up and up, shopper demand is reaching its breaking point- that is, consumers want to buy and they are restarting or beginning their plans to move now.
“That push of shopping demand that we’re seeing comes on the heels of maybe 15 years of latent, pent-up demand since the global financial crisis, where we have not had what any of us in the industry would consider a natural rate of secondary market transactions.”
We have touched on the phenomenon of consumers looking for new homes with more space to facilitate future remote work, vacation homes to get away from the stress of the current societal climate, and the need to move away from crowded cities for safety reasons.
Barton has deemed this the ‘great re-shuffling.’
“We’re spending so much time in our homes that the relative value of home relative to every other space in our lives is much greater obviously. It’s almost mathematical because we’re spending so much time in our homes that we care a lot more.”