Zillow is “pausing” its ibuying efforts for the remainder of 2021.
Zillow Offers Not Buying More Houses This Year
According to Bloomberg, Zillow’s tech powered ibuying platform, Zillow Offers announced in an email that it has “hit its capacity” for 2021. In plain English, this means that Zillow Offers is suspending its home buying efforts for the remainder of this year.
Obviously, Zillow, like every other home flipping business, has hit a snag in making repairs and renovations to its existing homes due to glitches in material supply chains, labor shortages and increased costs.
Zillow’s chief operating officer Jeremy Wacksman said, “We’re operating within a labor- and supply-constrained economy inside a competitive real estate market, especially in the construction, renovation and closing spaces. We have not been exempt from these market and capacity issues and we now have an operational backlog for renovations and closings.”
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Zillow To Concentrate on Backlog of Properties in its Pipeline
ZillowOffers bought more than 3,800 homes to flip during Q2 2021.
Wacksman said, “Pausing new contracts will enable us to focus on sellers already under contract with us and our current home inventory.”
Even though ibuying is powered by algorithms and LOTS of capital to buy homes to flip, it is also powered by human beings for repair and renovation those houses. Staffing and material shortages have plagued all ibuyers at various points during the 18-month pandemic.
Zillow’s Plan B During Suspension of House Purchasing
Zillow is referring all of its buying and selling customers to its network of Zillow Premier Agents while its ibuying operations are suspended for the remainder of 2021.
During its ibuying “pause,” while giving its flipping operation time to catch up, some customers may simply turn to alternative ibuying options such as Opendoor, Zillow’s ibuying main rival, or Offerpad or Redfin Now.
Opendoor, of course, responded with an email to Inman that said, “We know how important certainty and convenience are to homeowners seeking to move and we’ve worked hard over the past seven years to ensure we can continue to deliver our experience at scale. Opendoor is open for business and continues to scale and grow.”
Redfin Now said in a statement that its iBuying program is up and running. Offerpad emailed that its “operations are running as smoothly as ever.”
Perhaps Opendoor, Redfin Now and Offerpad have been and continue to be exempt from any staffing and/or material shortages during these trying times of pandemic and supply chain challenges?
Thanks to Bloomberg and Inman.
