Jeremy Wacksman, CEO of Zillow, shares insights on the current state of the U.S. housing market amidst high mortgage rates and limited inventory. He highlights Zillow's impressive 17% revenue growth despite these challenges. Wacksman discusses critical supply-side issues and successful reforms in cities like Austin to boost housing availability. He also sheds light on the new partnership with Redfin to enhance rental listings and the impact of rising interest rates on consumer behavior, emphasizing affordability and financing. This candid conversation reveals the evolving landscape of real estate.
High mortgage rates are constraining buyers and sellers, leading to low inventory levels that stifle the housing market's recovery.
Zillow is expanding its services and leveraging technology to innovate the home-buying process and enhance visibility for renters.
Deep dives
The Impact of Mortgage Rates on the Housing Market
High mortgage rates are significantly affecting the U.S. housing market, constraining both buyers and sellers. Many homeowners feel locked into their current mortgages and are hesitant to list their homes due to the prospect of higher rates on new loans. This has resulted in persistently low inventory levels despite a recent 18% increase compared to last year. Without sufficient inventory and with decreased affordability, the market faces challenges that hinder recovery.
Zillow's Growth Amidst Market Challenges
Zillow continues to see growth despite an overall depressed housing market, aiming for revenue growth in the low to mid-teens for the upcoming year. The CEO emphasized that they are outgrowing their competitors and making strides in their integrated super app strategy. Even as the market remains under pressure, Zillow is increasing its share by focusing on their rental business, which achieved a 25% growth in Q4. This commitment to expanding services reinforces Zillow's goal to facilitate transactions for buyers and sellers.
Innovations and Strategic Partnerships in Real Estate
Zillow is actively pursuing innovations in artificial intelligence to improve the home-buying process for consumers and real estate professionals. Their recent partnership with Redfin aims to address the lack of a centralized rental database, improving visibility for renters by consolidating listings. This collaboration, along with a similar one with realtor.com, is geared towards enhancing inventory access for potential renters. By embracing technology and forming strategic alliances, Zillow seeks to simplify the complexities of real estate transactions.