How Zillow's homebuying scheme lost $881M • Hacker News Board

Re: How Zillow's homebuying scheme lost $881M

#681

Post by Breza » Wed, Mar 30, 2022, 1:18 AM UTC

escapedmoose wrote: post #223

wcfields wrote: post #20

Earlier quoted context omitted.

If I can give any home buying tip from my experience of buying two houses it's been to look at places that are in "the middle". Both homes I've bought in SoCal have had some god-awful photos online, and the finish is new-ish, but done by someone in the 70s so it's new but tacky in a little-old-lady way. This ends up pricing the house too expensive to flippers, and not nice enough to sell compared to other houses beca…

We took the same approach with our house, and the results were marvelous. Major props to our realtor for seeing the potential hidden in those god-awful listing photos.

Same here! We ended up with a house that had been on the market for a long time. Turns out the biggest problem was its terrible listing.

Re: How Zillow's homebuying scheme lost $881M

#682

Post by Breza » Wed, Mar 30, 2022, 1:20 AM UTC

polski-g wrote: post #409

bastawhiz wrote: post #6

I recently bought a home. We toured a Zillow home, and I can understand what they were going for and where they failed. We were able to pull up to the driveway, book a tour for that minute, and walk in the front door. It was almost a magical experience compared to the process of finding and going to showings. The listings were clear and thorough. The experience was extremely compelling. The downside: the homes were a…

Zillow prices my house 100k higher than redfin

I have the opposite experience. I love my house but if Redfin offered to pay me what the say my house is worth, I might sell and buy the bigger house next door.

Re: How Zillow's homebuying scheme lost $881M

#683

Post by Breza » Wed, Mar 30, 2022, 1:27 AM UTC

Otternonsenz wrote: post #361

buzzdenver wrote: post #355

Earlier quoted context omitted.

What was stopping Zillow from having a human look at the property and adjust the price based on factors that their algorithm didn't consider?

Nothing, but that would require them hiring an appraiser on each transaction, which would be humbling for them to have to do (and while biased as an appraiser myself, I would not trust anyone else other than a licensed appraiser to do that type of adjustment work, because it’s a daily part of our jobs). Or they could have an internal team of appraisers doing that type of work, but the business might not like it when…

It's wild that they didn't have human appraisers review at least a sample of the houses to groundtruth the algorithm.

Re: How Zillow's homebuying scheme lost $881M

#684

Post by Otternonsenz » Wed, Mar 30, 2022, 6:39 PM UTC

Breza wrote: post #683

Otternonsenz wrote: post #361

Earlier quoted context omitted.

Nothing, but that would require them hiring an appraiser on each transaction, which would be humbling for them to have to do (and while biased as an appraiser myself, I would not trust anyone else other than a licensed appraiser to do that type of adjustment work, because it’s a daily part of our jobs). Or they could have an internal team of appraisers doing that type of work, but the business might not like it when…

It's wild that they didn't have human appraisers review at least a sample of the houses to groundtruth the algorithm.

Greed and wanting to be ahead of others will blind you to truth standing right in your face. While everyday workers at Zillow didn’t have a say in company policy, you can’t tell me that the executives and project managers didn’t know what they were doing or why they were doing it. They didn’t want to be told their idea was bad or couldn’t work (which it did work until it didn’t) early on, so they got the debt they refused to pay through due diligence.

And Zillow has been around for almost 20 years, so it’s not like they didn’t have awareness of how the home market works or how to validate pricing metrics. From the outside it fells like willful ignorance, but perhaps they suffer from the same ills any large company trying to “move fast and break things”.