Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

marketwatch.com

Post reply on HN
Print view View original

161–170 of 476 posts

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#161

Post by Hjfrf »

analyte123 wrote: post #42
muttantt wrote: post #11

Crazy. I recently sold a condo to Opendoor for significantly more than I would have even thought to list it for. When I negotiated with Opendoor after their initial offer, I pointed out a recently sold condo (days before, in similar condition, layout and finishes) in the same complex that sold for much higher than Opendoor offered. Within hours Opendoor came back matching that same selling price. The kicker? It was a…

If local real estate agents and developers can manage to manipulate the "Zestimate", and I'm pretty sure they are at least trying, you can imagine the payoff.

Developers could certainly do it.

A single padded first sale on a new development would be factored into offers. Classic wash trade.

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#162

Post by HWR_14 »

yalogin wrote: post #19
beamatronic wrote: post #8

Earlier quoted context omitted.

Agree 100%... I'm astonished that a large corporation trying to get into this business, would "bite off more than they could chew". Don't they have MBAs and financial models to assess this sort of thing?

If MBAs and financial models can predict slowdowns, we won't have them at all. If anything ML models will exacerbate the situation IMO and they probably relied on them too much and bought more than they should. Of course what I said is also a projection (without even an ML model), so that is not accurate either :)

The models don't have to predict a slowdown. They just have to account for the total amount of risk Zillow is assuming.

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#163

Post by nfzOndjy »

ChuckMcM wrote: post #102
muttantt wrote: post #11

Crazy. I recently sold a condo to Opendoor for significantly more than I would have even thought to list it for. When I negotiated with Opendoor after their initial offer, I pointed out a recently sold condo (days before, in similar condition, layout and finishes) in the same complex that sold for much higher than Opendoor offered. Within hours Opendoor came back matching that same selling price. The kicker? It was a…

Very much like the $5000 books on Amazon where the algorithms are anticipating flipping an existing listing. Congrats on winning this round! The next step might be interesting which would be to go back and re-purchase the Condo once the price corrects to the 'real' price and bank the difference. I have read this article and the one before it and it sounds very much like some folks who fell in love with their own idea…

Can you recommend a few of those hot papers? I would love to read about that more.

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#164

Post by enlyth »

AussieWog93 wrote: post #136
enlyth wrote: post #113

Good riddance, I hope this company burns to the ground The software developers working for this company knowingly tried to make algorithms to flip and profit off of something that should be a human right Replacing carpets and painting walls, trying to flip for a 20% profit, the people running Z must be geniuses As a millennial looking at 2 bedroom flats selling for £575k (780k usd, not far from a million dollars) in…

In defense of Zillow, they weren't looking to buy a "portfolio" of houses - they bought as many as they sold, and didn't have any net negative effect on housing supply. Yes, they're profiting off of a bad situation, but they're not the cause of it. Bev from the local council's planning department, as well as Michael Caton's horrific propaganda piece, has done more damage than every flipper combined.

I'm not saying Z is the cause of the crisis, it's more like them trying to capitalize on it. How bad you view this is based on your political quadrant, so fair enough to those who don't think it's a problem.

What I'm trying to bring attention to is that our generation is frustrated, we are priced out of owning a home unless we have some massive help from our parents or inheritance, and being repeatedly told that we will own nothing and it is for our own good is demoralizing.

There might be a sizeable portion of people who do have help from their family of putting down massive six figure deposits or are up on their luck from investments, but I still think it's important to bring attention to the housing crisis for those of us who haven't had the same sort of luck.

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#165

Post by HWR_14 »

gravypod wrote: post #154
AussieWog93 wrote: post #138

Earlier quoted context omitted.

>I've been seeing homes steadily creep back to what inflation would account for in price delta. Do you have any data or more info about this? I think many of us young 'uns would just like some hope right about now.

Nothing scientific, just observing ~20 listings by my apartment (that I would love to live in some day). I would however offer that if anyone can give me unfettered access the data of multiple MLSs I could generate some visualizations. I really really really want this data.

Just to pile on, I also would like access to that data.

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#166

Post by iab »

ChuckMcM wrote: post #160
iab wrote: post #131

Earlier quoted context omitted.

Traffic fascinated me - please post a link to that paper

I will see if I can find it, not all papers published in the 80's are online. (and I just looked the professor is emeritus at USC now but still around so I'll send him the question too)

I would really appreciate it

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#167

Post by engineer_22 »

AussieWog93 wrote: post #136
enlyth wrote: post #113

Good riddance, I hope this company burns to the ground The software developers working for this company knowingly tried to make algorithms to flip and profit off of something that should be a human right Replacing carpets and painting walls, trying to flip for a 20% profit, the people running Z must be geniuses As a millennial looking at 2 bedroom flats selling for £575k (780k usd, not far from a million dollars) in…

In defense of Zillow, they weren't looking to buy a "portfolio" of houses - they bought as many as they sold, and didn't have any net negative effect on housing supply. Yes, they're profiting off of a bad situation, but they're not the cause of it. Bev from the local council's planning department, as well as Michael Caton's horrific propaganda piece, has done more damage than every flipper combined.

Sounds like they have a couple billion in inventory.

No matter how you slice it, they were speculating on housing inflation.

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#168

Post by x3sphere »

matmatmatmat wrote: post #81
pezzana wrote: post #34

> ‘We’ve determined the unpredictability in forecasting home prices far exceeds what we anticipated and continuing to scale Zillow Offers would result in too much earnings and balance-sheet volatility,’ CEO tells investors. That's quite a statement. The head of a company with a privileged view of the US residential real estate sector says that the market is "unpredictable." Not the good kind of unpredictable where yo…

It's unclear to me how much visibility Zillow really had, since, AFAIK, they don't have access to MLSs in the areas where they buy and sell.

Hard to believe they don’t have MLS access. The listings on Zillow go up essentially at the same time my realtor has gotten them through the MLS, so they must have an automated way of pulling the info…

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#169

Post by engineer_22 »

lokar wrote: post #141
AussieWog93 wrote: post #136

Earlier quoted context omitted.

In defense of Zillow, they weren't looking to buy a "portfolio" of houses - they bought as many as they sold, and didn't have any net negative effect on housing supply. Yes, they're profiting off of a bad situation, but they're not the cause of it. Bev from the local council's planning department, as well as Michael Caton's horrific propaganda piece, has done more damage than every flipper combined.

They were trying to act as a market maker, providing liquidity for a price. Nothing wrong with that.

The market doesn't need any more liquidity. Banks will lend to anyone with a pulse.

Re: Zillow to stop flipping homes, loses more than $550M, lays off 25% of staff

#170

Post by justinwp »

stingrae wrote: post #120
pezzana wrote: post #34

> ‘We’ve determined the unpredictability in forecasting home prices far exceeds what we anticipated and continuing to scale Zillow Offers would result in too much earnings and balance-sheet volatility,’ CEO tells investors. That's quite a statement. The head of a company with a privileged view of the US residential real estate sector says that the market is "unpredictable." Not the good kind of unpredictable where yo…

When I use Zillow and check the Zestimate, for various properties, it seems to be super far off. If they used it for speculative property purchases, I can imagine that would go terribly wrong.

Recently had an appraisal for refinance. The appraiser's estimate was The reason? No comparable homes that were recently sold AND available via MLS (private sales are ignored). The rules for appraisals breakdown when there is no liquidity. At least Zillow still considered private sales. The Zestimate was much more correct than the "expert" appraiser.
Post reply on HN