Market Insights as Zillow Reports Doubled Q1 Revenue
Today in real estate, we are all looking for insights about the future of the market. Zillow’s publication of their Q1 financial report and modified strategies in the age of COVID-19 elicit industry insights for the past, present, and possible future. Inman presents us with an article digesting this information relating to what this will mean in terms of the future of the market, as well as the new normal of real estate.
Zillow’s First Quarter 2020
- “Zillow posted $1.1 billion in revenue for the first quarter, more than double the $454.1 million in revenue it posted in 2019.”
Zillow’s Current Status
Zillow reports feeling optimistic about the housing market as they observe market interest, people continuing to shop for homes, and prospective buyers looking to move during the pandemic. Amidst such significant numbers at the close of Q1, Zillow had already began to make efficiency cuts throughout their operation. They have reported a new focus: serving their customers and high-earning agents.
- “Zillow posted a net loss of $163 million. The company also broke down its net losses by segment, posting a net loss of $41.5 million, $98 million and $13.1 million for the IMT (internet, media & technology), homes and mortgages segments, respectively.”
Accordingly, they cut expenses in four specific areas to align with these customer-serving efficiency goals. Zillow cut spending by ceasing hiring, halting home acquisitions through Zillow Offers, and reducing discretionary spending.
We are left wondering what these strategic, forward-thinking moves will bring for the future of the company. How can these modifications be applied to the entirety of the real estate world? And lastly, what will be the residual impacts?
- “’The accelerated revenue growth was due to a combination of a substantial increase in connections, increased customer and agent satisfaction, continued focus on working with higher-performing agents, and tailwinds from a favorable housing market during January and February,’ Barton said.”
Perhaps, for the rest of us, focusing on a new version of budget efficiency and cultivating close connections will prove fruitful later down the line. You can find the full article here.