Zillow CEO dreams of housing market “trade-ins”

Technology

If the housing market described by Zillow CEO Richard Barton comes to pass, pretty soon home buying won’t require many humans to guide the process.

“We dream one day of you having kind of almost a trade-in experience with your house,” Barton said, in a CNBC interview at an RBC Capital Markets tech conference in New York last week.

Barton described his vision:

“You’re standing in a Zillows Offers house that we own,” Barton said. “You’ve been there 15 times, you’ve let yourself in with the Zillow app, we know who you are and where you live, we already have a mortgage ready to go, we have an offer ready for your house when you’re ready to transact, and you with one click can decide to move.”

The CNBC reporter wryly commented: “You don’t want to have a fat thumb at that moment, if you didn’t mean to do it.”

Earlier this month, Zillow announced third-quarter revenue more than doubled from a year earlier to $745.2 million, boosted by its home-flipping business called Zillow Offers.

The Zillow segment that buys and sells homes rose to $384.6 million from just $11.1 million a year earlier. The company sold 1,211 homes and bought 2,291 homes in the third quarter, the company said in a regulatory filing.

It was the first time revenue from the Homes segment surpassed the company’s Internet, Media & Technology segment that includes the lead-generating Premier Agent service.

Zillow said it expects its home-flipping business to generate as much as $1.25 billion in revenue for all of 2019, leading the company to estimate revenue for the year will be $2.59 billion to $2.62 billion. That compares with 2018 revenue of $1.33 billion.

The business of buying and selling of homes fuels other Zillow segments, as well, Barton said.

“The house transaction is the hub of a series of big, important and potentially profitable transactions,” Barton said in at the tech conference. “Getting the mortgage, title, escrow, moving – all this is keyed off the house transaction and we are making investments in most of these businesses, specifically mortgages, title, and escrow, right now, and creating an integrated digital platform.”

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