Zillow, once again, is on the move. It’s doubling down with its iBuyer business, upgrading its Premier Agent concierge services, and integrating its Premier Agent app with its transaction management portal, dotloop.
These moves raise Zillow’s revenue stream expectations from its $1,079B in 2017 to $1.309B in 2018. Currently that stream is filled with advertising from its Premier Agents at 71%, ad and mortgage software sold to mortgage lenders at 15% and “other” real estate professional and new construction services at 7%. In the meantime, the operators of Trulia and StreetEasy (both owned by Zillow) posted a record $1B in annual revenues in Q4 2017.
Zillow’s iBuyer InstantOffers expansion from Orlando into Phoenix and Las Vegas now goes toe to toe with OpenDoor and its own partner, OfferPad.
InstantOffers enables prospective sellers to go on its website to receive sale price options from professional home valuations experts and CMAs from licensed agents as well as offers on the seller’s home itself from iBuyer investors. Sellers can choose to accept an all cash offer from the investor or list the house on the open market with an agent in hopes of getting a higher sale price.
Errol Samuelson, Zillow’s Chief Industry Development Officer, explains that Zillow is essentially partnering with local agents and brokers to represent them on both the selling and buying side of the transaction. “We use hand picked local agents to represent Zillow…these agents will already be participating Premier Agents with (us)…we are not becoming a brokerage…we’re sort of sticking to our roots of being a media company, a tech company, and partnering with brokers and agents…when we’re buying and when we’re selling.”
Zillow announced that it is partnering with the West USA realty firm in Phoenix and with Coldwell Banker Premier Realty in Las Vegas as Zillow rolls out its iBuyer programs in those locations. Berkshire Hathaway Home Services Arizona and Nevada will also team with Zillow in those two markets.
Samuelson emphasized that Zillow’s iBuyer program is different from any other iBuyer program because its “…focus is on keeping agents at the center of the transaction.” But, in fact, both OfferPad and OpenDoor work with agents on the selling side of the transaction.
Zillow has not yet released any information pertaining to how much money it will spend on buying homes via its iBuyer program, information pertaining to agent commissions for buying and reselling Zillow labeled homes or information pertaining to how much home sellers would be charged for any fees.
Butte, Montana will be the first to roll out Zillow’s newly upgraded Premier Agent concierge services. The program will now directly connect sellers with local agents by phone/text so the two parties can immediately hook-up at mutually convenient times. No waiting to be connected. No information about additional charges on top of PA membership fees was mentioned for this concierge service.
Integrating the Premier Agent app with Zillow’s transaction management portal, dotloop, will enable agents to accurately measure the conversion rates agents “get” with Zillow leads. Ron Josey, an internet analyst with JMD, said, “Agents could say, ‘OK, this is how many leads I get from Zillow and this is how many I actually closed in a month.’ That will help prove the value that Zillow is providing to the agent.”
And, this dotloop integrations could help drive up Zillow’s ROI as well.
As Brad Inman of Inman News opined about Zillow’s big moves into its iBuyer ‘s markets, upgrades and application integrations, “Zillow follows the money.”