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Zillow lost money because they weren't willing to lose money

stevenbuccini.com

351–360 of 386 posts

Re: Zillow lost money because they weren't willing to lose money

#351
post #310

Earlier quoted context omitted.

I remember hearing that 15 years ago. I remember hearing about how we are due for an earthquake that will break California into two. That was in the 80/90s. We had great fears of a new ice age in 60/70s. I don't know what the future holds but thinking Arizona will become unsafe in 10-15 due to climate change is a little foolish.

Sounds like you have "heard" a lot of different things over the years. Have you look at any actual data? Have you seen the trends in the data that have been going in the wrong direction? At the end of the day, unless the direction changes, it does not matter if it happens in 10 or 15 years or may take longer. It will happen.

Would you care to enlighten us with this data you speak of?

Re: Zillow lost money because they weren't willing to lose money

#352

Earlier quoted context omitted.

You'd be surprised at how progressive southern states are. The Texas state motto is literally "Friendship." Now, I don't know much about Texas but I did live in Arizona for a few years. It surprised me more than a bit, as someone who grew up in New York. Arizona legalized medical marijuana quite early, followed by recreational marijuana. Their medicaid program AHCCCS [1] is extremely comprehensive and even pays for U…

Arizona isn’t in the South

Last time I looked at a map it was next to Mexico which is as far south as one can travel before leaving the United States. Where do you consider it to be?

Re: Zillow lost money because they weren't willing to lose money

#353

Framing it as machine learning undersells the problem. It's a hybrid model trading in an adversarial, real-dollar environment. The leverage comes from having a small human team trade big volume, much more than they could possibly trade directly, by augmenting their human abilities with automation and a model. Or seen from the other side, it's a model with human oversight. Any system like that is high risk, high rewar…

I think Opendoor still does poorly in new markets, but then it improves as they work out the quirks of the local market and start asking the right questions and collecting the right information.

A big part of Opendoor is creating the right apps and processes to collect this information to feed their models. The machine learning part is important, but can give the false impression it's just about data scientists crunching numbers at head office, when in reality there's a huge real-world operational machine that's driving it.

Re: Zillow lost money because they weren't willing to lose money

#354

Earlier quoted context omitted.

I don't think Levine successfully disputes the importance of adverse selection here. Sure, if you make a million low-ball offers, a handful will be accepted for God knows what reason. That doesn't mean that adverse selection isn't a serious danger when you attempt to scale up, as Zillow did. I mean, why did Zillow go straight from making profitable purchases of few houses to losing money on tons? If there's some swee…

> I think it's obvious that homeowners know much more about the houses and neighborhoods they live in than Zillow, and this creates a big risk for Zillow. I really question the idea that most people have any idea what their home is worth without relying on... Services like Zillow. Especially if they've lived there a while.

Most people don't know what their home is worth, and if you get two appraisers or realtors to give you an estimate they'll likely be quite different.

Similarly, if you think a house is worth $500k but you list it for $600k, you don't know if someone will decide they love that house and they're willing to pay that amount or not.

That's one reason Opendoor tends to list houses at a fair premium to what they paid, as sometimes someone decides it is worth it and they make 20%+ on homes like that.

Re: Zillow lost money because they weren't willing to lose money

#355
post #95
post #23

Earlier quoted context omitted.

Both. In an illiquid market, it takes a long time to find buyers or sellers. You are incentivized to overprice (if selling) or underprice (if buying) and wait a long time to see if someone will match you. A liquid housing market means people can buy or sell the house at the "right" price without waiting many months or years. As a seller, would you rather wait a year to make a bit more money? That wouldn't be good. Th…

Sure, but the more important point is that the market represents housing. Having housing empty is pointless, so market speculation is that is not about the rent from the asset but only its capital growth leads to that exact outcome, empty housing has lower expenses and depreciation in reality, which helps maintain the asset's value better than if someone was living in it.

I haven't heard of housing sitting empty. Even if there is a flipper in the chain of possession, houses end up getting acquired by long-term investors who rent them out or people who actually live in them. As far as I'm aware.

Re: Zillow lost money because they weren't willing to lose money

#356

Earlier quoted context omitted.

I don't think Levine successfully disputes the importance of adverse selection here. Sure, if you make a million low-ball offers, a handful will be accepted for God knows what reason. That doesn't mean that adverse selection isn't a serious danger when you attempt to scale up, as Zillow did. I mean, why did Zillow go straight from making profitable purchases of few houses to losing money on tons? If there's some swee…

> I think it's obvious that homeowners know much more about the houses and neighborhoods they live in than Zillow, and this creates a big risk for Zillow. I really question the idea that most people have any idea what their home is worth without relying on... Services like Zillow. Especially if they've lived there a while.

Zillow just has Zillow. The homeowner has Zillow, local realtors, inspections, personal experience of the house...

Re: Zillow lost money because they weren't willing to lose money

#357
post #126

Earlier quoted context omitted.

Toxoplasmosis is a scary thing.

Indoor cats don't magically get diseases. Just like an indoor pet bat isn't going to magically contract rabies. They might if you are letting them out to go roam the terrain. I'm really tired of these silly perpetuated mythologies.

All it takes is one exposure, and your "indoor" cat can infect your remaining pets (and you).

This entire topic is is marred with silly nonsense like "your only risk is mishandling cat feces", which totally ignores things like:

1) The cat litter box is covered in microscopic parasite-containing cat feces

2) The cat tracks feces-covered litter out of the box into the living space, which further spreads the parasite. If you walk barefoot through your house, you will step on cat liter pieces eventually which are again covered in microscopic feces.

3) The cat steps in litter covered in cat feces from other cats, gets it on its paws, which it then licks, starting the infection cycle over again. Multiple cats can easily keep a perpetual infection cycle going.

4) Cats, even well trained ones, routinely climb on top of furniture/eating/cooking surface and coat them in their feces. My parents were shocked after installing an interior camera when they saw their "well-behaved cats that never do that" walk all over their dinner table, kitchen counters, open and go inside cabinets etc etc. They are smart enough to know when you are around or not, and to not act like this when you can see them.

5) Cats have sharp claws, and even well behaved ones can accidentally scratch you or scratch a toddler that gets too close etc. This will then directly introduce cat feces to your blood stream.

Once exposed, the initial symptoms are mild flu-like symptoms and not a huge deal (unless you are pregnant, in which you will likely experience a miscarriage. Pregnant women should not be exposed to cats, or be in a household that has indoor cats). The real issue is the long term cysts they leave behind in your brain, causing a latent inflammation and immune response that seemingly interacts with your dopamine system in poorly understood ways. For example, latent cyst-stage toxoplasmosis significantly increases your risk of developing schizophrenia.

Re: Zillow lost money because they weren't willing to lose money

#358

Earlier quoted context omitted.

How can an indoor cat ever clean themselves though? It doesn’t seem like most indoor cat owners bathe the cats, do they?

Bathing cats can give them infections if the water gets in their ears. Generally, they clean themselves in a freshly cleaned litter box, what's called a "sand bath" by rolling around. They also clean themselves by licking themselves. They do a very good job, I've been around cats my whole life and none of them smell except perchance the fat ones that cannot lick their butts and sometimes have a bit of a dirty butt. I…

>what's called a "sand bath" by rolling around.

I'm sorry, but is this a joke and I'm just missing it? I find it hard to believe that you are seriously suggesting a cat rolling around in a feces-covered litter box is "cleaning itself".

>freshly cleaned litter box

There is essentially no such thing as this. You would need to completely remove the litter and sanitize the box with bleach _each time your cat poops_. No one does this, they scoop out poop and put the contaminated scoop in a bucket or something. The next time the cat enters the "clean" box it is covered in it's own feces, and your scoop acts as a cross-media reinfection device. Litter boxes are, in practice, perpetually dirty things.

Re: Zillow lost money because they weren't willing to lose money

#359
post #288

Earlier quoted context omitted.

How can an indoor cat ever clean themselves though? It doesn’t seem like most indoor cat owners bathe the cats, do they?

Cats lick themselves to get clean. They don't bathe even when they're outside.

Cats are not "clean" after they lick themselves, if anything this behavior is primarily responsible for the cultivation of a parasite lifecycle that has co-evolved to the cat's gut.

Cats, especially ones who share litter boxes, routinely get covered in potentially parasite-bearing feces via litter boxes and ingest it via grooming. This allows for easy additional spread/cross infection.

"Cats lick themselves, therefore they are clean" is a long-discredited but persistent myth.

Re: Zillow lost money because they weren't willing to lose money

#360
post #126

Earlier quoted context omitted.

Toxoplasmosis is a scary thing.

Not exactly. From what I read it’s almost completely benign in most humans.

This is not true, see my reply to your sibling comment for a more detailed answer. Toxoplasmosis is highly correlated with severe mental disorders like schizophrenia.
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