Hello, LOs!
Let's talk about Zillow. The iBuyer and listings portal announced positive earnings yesterday, but it also had a special surprise: Zillow announced that it had agreed to pay $500 million to acquire ShowingTime, an MLS tool that allows real estate agents to schedule home showings with prospective home buyers. It's a very popular tool – nearly 1 million agents use it. It also integrates directly into the MLS. Those are hot leads.
Many real estate agents appear to be worried about this acquisition, which is pretty standard fare for any Zillow M&A deal.
Some agents fear Zillow Group – which already has a brokerage, mortgage lender and title company – will control yet another element of the home purchase process, one that gives them direct access to buyer leads. Down the line, Zillow could squeeze them further or even figure out a way to harvest leads, some agents fear. (Plus there is the indignity that, as a vendor with the MLS networks, their dues effectively pay for ShowingTime, too.)
As for Zillow's mortgage company, it's barely received much attention at all despite its integration potential. A quick look at the NMLS shows that Zillow Home Loans has 176 loan officers. The lender, which was renamed following the acquisition of Mortgage Lenders of America in 2018, generated about $61 million in revenue last quarter, a 161% increase year-over-year.
"We plan to continue to capture the strong refinance demand to invest in building the factory to scale our operations as the purchase business is built out over time," Allen Park, the CFO, said on the call.
So that brings me back to you, LOs: Do you worry about Zillow's ambitions? If the real estate agent gets squeezed by iBuyers, what does that do to your business? How are you staying one step ahead? As always, you can email me anonymously at jkleimann@housingwire.com.
James Kleimann
Managing Editor, HousingWire
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