Here’s why Zillow has stopped buying homes for the foreseeable future.


If you haven’t seen the recent headlines, there was big news for a real estate tech giant this past week. Zillow announced to the world that it is shuttering its iBuying business, Zillow Offers. This comes after the news that they are writing down $304 million in Q3 and laying off 2,000 employees. Wall Street didn’t like this news much, and the stock tumbled 18%.

Zillow was committed to buying nearly 9,680 homes based solely on their algorithm, but they realized that a significant portion of the homes they purchased are now worth less than what they paid for them.

Computer-based models are always riddled with flaws.

Fifteen years ago, Zillow invented their computer-based valuation system, also known as the Zestimate. It is their claim to fame and ultimately what drew consumers to their site. Yet, after billions invested and continued refinement in the Zestimate, it’s still proving to be unreliable.

What does this all mean? Is there a crash coming? Quite the opposite! Research has continually shown that these computer-based models are riddled with flaws.

The problem is that the big tech and iBuying companies are putting too much faith in machines to do what humans can do better. Just because something can be automated doesn’t mean that it should be. The bottom line is that the best person to help you price your home remains a seasoned real estate professional, not artificial intelligence!

If you have questions for me about your home’s value or anything else related to real estate, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.