Due to the fact that images aren’t allowed on this subreddit, I cannot show the Google Trends charts but you should look it up and compare Zillow to Real Estate, Mortgage, and Homes for Sale. Zillow, even during the last months of worrying over the last months, hasn’t dropped significantly or in other words, their financial position has stayed strong.
Now, there traffic ranking is dropping from almost 100 from last week to 85 this week.
It only has been this low during December, the month with the least amount of home buying. June through August is usually when home sales spike and the fact that Zillow search results are lowering when in any other year they would be ramping up means the crash for them and other real estate platforms and stocks will happen.
I am personally opening a short position against Zillow due to the fact of their business models relying on agents paying for leads but if leads are less likely to convert, agents will pay less resulting in less revenue and lower margins.
Even if you account for Zillow flex which is around 10% of their business, that will be affected as much through less volume and less commission and lower/stagnant house prices meaning lower commissions per house sold.
I am going to buy some puts that are at least 100 days out and OTM. Good luck to everybody else.
Leave a Reply