Zillow Group Inc. will lay off 55 employees in Texas as it continues its exit from the home-flipping business.
The company began the layoffs with 33 employees in January, with the remaining employees being phased out of the business until August, according to a notice it filed June 17 with the Texas Workforce Commission.
The notice attributed the layoffs are due to the elimination of its Zillow Offers business, an iBuying service through which Zillow bought, fixed and sold homes for profit.
But the business has failed due to inflation issues and Zillow overpaying for properties, leading to the dissolution of iBuying last year.
A company spokesperson said the employees were based throughout Texas, while a further statement added that all departing employees will receive a severance package including at least 10 weeks of pay and six months of benefits.
Zillow said it did not take the layoffs ‘lightly’.
The company announced in autumn 2021 that it would shut down Zillow Offers and reduce its workforce by about 25% over several quarters. At the time, Zillow Group CEO Rich Barton said forecasting home prices was more unpredictable than it expected, and that continuing to expand the business would lead to too much volatility in its earnings and balance sheet.
"While we built and learned a tremendous amount operating Zillow Offers, it served only a small portion of our customers," Barton said in a third-quarter 2021 earnings release.
Barton was reappointed as CEO last month despite the failed Zillow Offers experiment.
Zillow said that it paid off all its debt related to buying homes in April, sooner than expected, as homes sold faster and for more cash than the company projected. It stopped buying homes at the end of January 2022.