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Message
Question about a Zillow home listing
Posted on 10/27/21 at 8:53 am
Posted on 10/27/21 at 8:53 am
I'm not involved with this anymore so it doesn't really matter, I'm just extremely curious and have no idea so hoping someone here can chime in.
-I lived in a condo for a few years and just sold it this past August 2 months ago.
-It was bought by Zillow.
-They offered $12K over our asking price, which we actually thought was a bit high to begin with
-No issues at all with the sale or transaction. We assumed that zillow would basically renovate the entire thing wall to wall and turn around it list it for higher
-I see online that it is now up for sale again. However, there have been basically zero changes. Looking at pictures the only noticeable change at all in the place was they removed our really nice expensive microwave and replaced it with a cheap college style one. That's it.
-Here's the kicker..the asking price is actually $100 LESS than what they paid us for it
What is happening here? I just can't think of any logical reason why they would buy a place (well over asking), make no changes to it, then attempt to sell it again for zero profit. Am I missing something?
-I lived in a condo for a few years and just sold it this past August 2 months ago.
-It was bought by Zillow.
-They offered $12K over our asking price, which we actually thought was a bit high to begin with
-No issues at all with the sale or transaction. We assumed that zillow would basically renovate the entire thing wall to wall and turn around it list it for higher
-I see online that it is now up for sale again. However, there have been basically zero changes. Looking at pictures the only noticeable change at all in the place was they removed our really nice expensive microwave and replaced it with a cheap college style one. That's it.
-Here's the kicker..the asking price is actually $100 LESS than what they paid us for it
What is happening here? I just can't think of any logical reason why they would buy a place (well over asking), make no changes to it, then attempt to sell it again for zero profit. Am I missing something?
11
Posted on 10/27/21 at 9:02 am to WG_Dawg
Posted on 10/27/21 at 9:03 am to WG_Dawg
There has to be some breakdown right now where the people executing the plan are incentivized on the transaction rather than the long term profitability.
Posted on 10/27/21 at 9:11 am to WG_Dawg
quote:
Here's the kicker..the asking price is actually $100 LESS than what they paid us for it
That's some honest folks. They knocked off the price difference of that microwave.
Posted on 10/27/21 at 9:16 am to WG_Dawg
I use Zillow frequently, mostly for rentals. Their pricing on suggested rents are all over the place.
They probably stopped buying to fix their faulty algorithms.
They probably stopped buying to fix their faulty algorithms.
Posted on 10/27/21 at 10:34 am to WG_Dawg
Maybe they just really wanted your microwave.
Posted on 10/27/21 at 12:08 pm to pt448
They made $200 on the sale of the microwave, so they can afford to take the $100 bath
Posted on 10/27/21 at 7:50 pm to WG_Dawg
Maybe they will get a kickback on the future mortgage
Posted on 10/27/21 at 7:56 pm to WG_Dawg
Maybe the bought multiple similar properties at market value and then bought yours at a higher price so there was a higher priced comp when they sell them.
Posted on 10/28/21 at 8:41 am to WG_Dawg
quote:
they removed our really nice expensive microwave and replaced it with a cheap college style one. That's it.
-Here's the kicker..the asking price is actually $100 LESS than what they paid us for it
simple: zillow sold your microwave for $200 and by dropping the price of the condo by $100 they're doubling their profit!
Posted on 10/28/21 at 8:41 am to MAXtheTIGER
quote:
They made $200 on the sale of the microwave, so they can afford to take the $100 bath
dammit!!! i can never be first around here
Posted on 10/28/21 at 3:57 pm to CAD703X
"the company tweaked its algorithm to jack up the bids it offered on real estate."
---
Those damned algorithms!
---
Those damned algorithms!
Posted on 10/30/21 at 12:03 am to WG_Dawg
Was the net walk away cash $12 more or did they offer a higher price and then deduct fees and expenses from that offer price?
The model Zillow and the other corporate buyers are using is not sustainable. Its the Walmart model designed to push the Realtor model out and then they remake the industry to their advantage.
The model Zillow and the other corporate buyers are using is not sustainable. Its the Walmart model designed to push the Realtor model out and then they remake the industry to their advantage.
Posted on 10/30/21 at 8:25 am to WG_Dawg
I've been under contract with Zillow for about 6 weeks and close towards the end of November. I don't know wtf they're doing. No way they get what they're paying me back.
Posted on 10/30/21 at 9:10 am to h0bnail
Interesting coincidence. Since writing my last post I received a Zillow email notification for a property near me that they own.
They are selling the property for $366,900 / $219 SqFt.
It looks like they bought it for $224 SqFt.
There Zillow estimate on their own property is $322,400
They are definitely playing some other strategy other than operating a legitimate Market Value Real Estate Service.
We now have Zillow, OpenDoor, Redfin, and OfferPad in our area buying single family properties. Add to this this the old school investment buying companies like We Buy Houses, New Western, and many smaller investment buyers.
The loser in all this are the buyers and especially the first time homebuyers and the low income buyers because what these large corporate buyers are doing will only artificially inflate the home values.
As I wrote that it hit me that this may be what they are trying to do. If they can show the higher prices they paid for properties and they do it enough then that will raise the appraisal values of the properties in the area. This is not a good business model either because 1. its illegal and 2. they will end up paying even more for the prices they pay in the future.
Zillow is based out of Seattle and they do have employees in the markets they are buying properties. They have much larger overhead than smaller investors to go along with their bigger pockets. In the end though, Real Estate has a finite ceiling with millions of consumers so they can't just starve out the competition by taking losses for a short period of time and then expect to own a market.
They are selling the property for $366,900 / $219 SqFt.
It looks like they bought it for $224 SqFt.
There Zillow estimate on their own property is $322,400
They are definitely playing some other strategy other than operating a legitimate Market Value Real Estate Service.
We now have Zillow, OpenDoor, Redfin, and OfferPad in our area buying single family properties. Add to this this the old school investment buying companies like We Buy Houses, New Western, and many smaller investment buyers.
The loser in all this are the buyers and especially the first time homebuyers and the low income buyers because what these large corporate buyers are doing will only artificially inflate the home values.
As I wrote that it hit me that this may be what they are trying to do. If they can show the higher prices they paid for properties and they do it enough then that will raise the appraisal values of the properties in the area. This is not a good business model either because 1. its illegal and 2. they will end up paying even more for the prices they pay in the future.
Zillow is based out of Seattle and they do have employees in the markets they are buying properties. They have much larger overhead than smaller investors to go along with their bigger pockets. In the end though, Real Estate has a finite ceiling with millions of consumers so they can't just starve out the competition by taking losses for a short period of time and then expect to own a market.
This post was edited on 10/30/21 at 9:34 am
Posted on 10/30/21 at 1:00 pm to WG_Dawg
Wonder if they could be doing stuff like this for tax purposes. 1031 exchanges come to mind.
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