Zillow Shutters Closing Services Division With the Loss of 80 Jobs

Zillow is to shut its Closing Services division with the loss of around 80 jobs because it does not believe that the product is "tech-forward" enough.

A Zillow spokesperson confirmed the news late on Wednesday evening:

“Integrating the real estate transaction to make buying and selling simpler for customers remains our core strategy and we believe offering title and escrow is a critical component. However, we determined our current offering through Zillow Closing Services isn’t the integrated product we believe customers and partners need, so we are sunsetting our current Zillow Closing Services operations while we explore more tech-forward solutions.”

The spokesperson also confirmed the elimination of approximately 80 jobs with media outlets in the States reporting that those affected would receive eight weeks of pay, plus one additional week of pay for each year of completed service and a lump sum in consideration for their stock equity vest.

In the US market, closing service providers help home buyers to deal with the paperwork and administrative tasks around a transaction. The service is typically offered by small-scale specialist firms with legal expertise.

Zillow first started testing its closing services product in late 2019 with the aim of bundling services around real estate transactions and having its brand present in more steps of the consumer home-buying journey.

The Seattle-based real estate portal company showed that it was not afraid to cut its losses when it spectacularly closed its iBuying division in November 2021. Although Zillow has never broken out the financials of its Closing Services division, it's more than likely that the product has seen numbers slump in the same way that those of the company's mortgage division have.

With the US mortgage market suffering from high rates and a chronic lack of new homes, many including Zillow rival Redfin have been struggling to justify sustained losses in the sector. Could Zillow's Mortgage division be next on the chopping block?