Zillow’s vision of a “housing superapp” is becoming more clear a year after it revealed its plans. Zillow has refocused its efforts on its “Five Growth Pillars” since it shut down its iBuying program in November 2021.
After 12 months of research and development, Zillow has launched several new products in its test market of Atlanta, Denver and Raleigh, as well as an announcement of a partnership with Opendoor. This partnership will help Zillow achieve its goal of creating a seamless platform that allows home buyers to seamlessly move from their first search through closing.
Rich Barton, Zillow CEO, stated that “we believe mover customers really need this magic app that integrates all these disparate parts of the move.” He spoke to analysts and investors on Wednesday’s earnings call for the fourth-quarter 2022 as well as the full-year 2022. It seems very natural to us that we should bring all that into one application experience where we plug in partners and services to make the move easier, more efficient, and more enjoyable. We are focusing on creating what I would call a reference platform in these test markets so it can work so we can scale nationally.
These new offerings and a more integrated platform will allow the firm’s share of transactions to increase from 3% to 6 percent by 2025, according to the firm.
Zillow is still dealing with a volatile and cooling housing market. Despite the headwinds caused by the housing market conditions the firm had a better fourth-quarter and full year 2022 than the previous year.
Zillow’s fourth quarter 2022 revenue was $435 million, a decline of 19% from the previous year. The net loss of $72million was still significantly lower than the $261 million loss in Q4 2021.
Revenue fell 8% to $2.0 billion for the full year 2022. However, the net loss for the year dropped from $528 million to $101 million 2021 to $201 million 2022.
These differences are attributed to the effect of closing its iBuying program at 2021.
Zillow executives are committed to improving the programs it is testing in its test markets, and scaling them across the country as they look ahead to 2023.
Barton stated that he likes the speed and quality of the products he ships. “It feels as if we are building momentum.”
Zillow Home Loans is one product executives are optimistic about. Barton stated that Zillow Home Loans had a 15% adoption rate in Raleigh’s test market in Q3 2022. This number rose to 20% in Q4.
Barton stated that even though Zillow Home Loans are not well-known, millions of Zillow customers applied for financing last year. This is a testament to the brand’s reach and audience size.
Executives stated that improving home touring experience in 2023 will be a key goal of the company.
Barton stated that “we are excited about the early signs out of Atlanta” which showed real-time touring allows for higher connection rates and customer propensity to work alongside Premier Agent partners. This will allow us to drive benefits up the funnel, delivering high-intent customers to our partners. We expanded the product’s availability in Atlanta, and we are now expanding it to three other test markets.
Despite slower market conditions, Zillow and Barton remain positive about the firm’s future and its ability to achieve its ultimate goal.
Barton stated that 2023 was a crucial year for us. It is all about progressing on our initiatives through product launches, market rollouts, so that we can expand and scale into the future. “We are now investing in a very difficult housing market after a year of significant people-related, and other expense reductions in 2022. While others are retrenching, we see real opportunities for growth.