Zillow to stop flipping homes for good as it stands to lose more than $550 million, will lay off a quarter of staff

[sri_india]

wow , yesterday's news on Arizona market is such a small comparing to this , their exit is good thing for OPEN stock (already up AH)

 

 

Zillow Group Inc. is calling it quits on the home-flipping business, while disclosing losses of more than $550 million on homes purchased in the second half of this year for which the company admits it paid too much.

The real-estate giant on Tuesday blamed a faulty algorithmic model for ditching its iBuying business of buying and selling homes quickly, and said it will lay off about a quarter of its staff. The surprising exit, announced with pedestrian quarterly profits, thrashed shares in another rough trading session Tuesday, a day after an analyst said two-thirds of the homes it bought are underwater.

“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,” Zillow Group Z, -10.24% ZG, -11.52% co-founder and Chief Executive Rich Barton said in a statement.

In an interview on CNBC, Barton called the decision “tough but necessary” after determining the business was “too risky, too volatile” and addressed too few customers. “Sure, there are those wagging their fingers at me,” he acknowledged. “Predicting the price of homes six months ahead is really hard” in the COVID age, he added.

The dissolving of the flipping business will take several quarters and include a reduction of Zillow’s workforce by approximately 25%, Barton said. Zillow disclosed that it wrote down $304 million in losses due to houses purchased for too high a price in the third quarter, and expects losses of $240 million to $265 million in the fourth quarter for the same reason, pushing total losses on those houses to more than $550 billion.

During the third quarter, Zillow said it bought 9,680 homes and sold 3,032 of them. It marked a significant jump from the record 3,805 homes it purchased in the second quarter, of which 2,086 were sold.

Shares fell 10% in extended trading following Zillow’s announcement of a net loss of $328.2 million, or $1.29 a share, compared with net income of $39.6 million in the year-ago quarter. Revenue rose 164% to $1.74 billion from a year ago. Analysts surveyed by FactSet had expected net income of 16 cents a share on revenue of $2 billion.

Zillow Group’s stock is down 34% in 2021; it declined 10.3% in regular session trading Tuesday, to close at $87.20. The broader S&P 500 index  SPX, +0.37%  has gained 23% this year.

[reality]

fafam

[Picheshwar]

Home flipping ante endhi @sri_india

[Spartan]

local real estate agents hava ne veru untadi

they have a strong grip in their counties cities that they wont allow an agent from outside of city.. 

alantidi oka corporate gadu vachi meeku share ista naaku ivvandi ante workout avvadu business

[Spartan]

Just now, Picheshwar said:

Home flipping ante endhi @sri_india

100k ki koni 10k petti renovate chesi 200k ki ammadam

[Sword_KanthaRao]

[sri_india]

6 minutes ago, Picheshwar said:

Home flipping ante endhi @sri_india

pathi indlu koni , renovate chesi malli ammadam ... zillow vadu aaa business chesthadu 

[sri_india]

6 minutes ago, Spartan said:

local real estate agents hava ne veru untadi

they have a strong grip in their counties cities that they wont allow an agent from outside of city.. 

alantidi oka corporate gadu vachi meeku share ista naaku ivvandi ante workout avvadu business

ok workout kaleee , but $550 million loss vochee varaku why they waiting? they could have stop it when losses are small kahda and now saying eee flipping valla  their balance sheet volatile .... 

[Anta Assamey]

Zillow is one of the many reasons for the current Home prices being so high ani na doubt... 

[Anta Assamey]

22 minutes ago, sri_india said:

wow , yesterday's news on Arizona market is such a small comparing to this , their exit is good thing for OPEN stock (already up AH)

 

 

Zillow Group Inc. is calling it quits on the home-flipping business, while disclosing losses of more than $550 million on homes purchased in the second half of this year for which the company admits it paid too much.

The real-estate giant on Tuesday blamed a faulty algorithmic model for ditching its iBuying business of buying and selling homes quickly, and said it will lay off about a quarter of its staff. The surprising exit, announced with pedestrian quarterly profits, thrashed shares in another rough trading session Tuesday, a day after an analyst said two-thirds of the homes it bought are underwater.

“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,” Zillow Group Z, -10.24% ZG, -11.52% co-founder and Chief Executive Rich Barton said in a statement.

In an interview on CNBC, Barton called the decision “tough but necessary” after determining the business was “too risky, too volatile” and addressed too few customers. “Sure, there are those wagging their fingers at me,” he acknowledged. “Predicting the price of homes six months ahead is really hard” in the COVID age, he added.

The dissolving of the flipping business will take several quarters and include a reduction of Zillow’s workforce by approximately 25%, Barton said. Zillow disclosed that it wrote down $304 million in losses due to houses purchased for too high a price in the third quarter, and expects losses of $240 million to $265 million in the fourth quarter for the same reason, pushing total losses on those houses to more than $550 billion.

During the third quarter, Zillow said it bought 9,680 homes and sold 3,032 of them. It marked a significant jump from the record 3,805 homes it purchased in the second quarter, of which 2,086 were sold.

Shares fell 10% in extended trading following Zillow’s announcement of a net loss of $328.2 million, or $1.29 a share, compared with net income of $39.6 million in the year-ago quarter. Revenue rose 164% to $1.74 billion from a year ago. Analysts surveyed by FactSet had expected net income of 16 cents a share on revenue of $2 billion.

Zillow Group’s stock is down 34% in 2021; it declined 10.3% in regular session trading Tuesday, to close at $87.20. The broader S&P 500 index  SPX, +0.37%  has gained 23% this year.

OPEN 15% down ayyi 3% perigindi ante kada...

[sri_india]

6 minutes ago, Anta Assamey said:

OPEN 15% down ayyi 3% perigindi ante kada...

hour back almost 9% up undee

[Sword_KanthaRao]

5 minutes ago, Anta Assamey said:

Zillow is one of the many reasons for the current Home prices being so high ani na doubt... 

+1

Home owners are using the Zillow suggested prices as expected selling prices.

Rentals kuda anthe…Zillow lo ne reinstall estimate ki oka 100 ekuva chepptunaru

[AndhraneedSCS]

7 minutes ago, Anta Assamey said:

Zillow is one of the many reasons for the current Home prices being so high ani na doubt... 

vadu konna 7000 homes valla ne antava?

[Anta Assamey]

1 minute ago, AndhraneedSCS said:

vadu konna 7000 homes valla ne antava?

One of the many reasons annanu anduke ... And more over... Buying few in a locale and increasing the price will show the effect in the surroundings..As people will try to sell in the same price range...

[ranam_007]

how to find zillow owned homes as i tried to check but not able to find one