How Zillow stays the course when the housing market turns

Executive overview

Real estate transactions are expensive, emotional, and stuck in archaic analog processes — and market volatility makes an already hard problem worse. Zillow's response is not to chase every rate move or market shift, but to keep building toward a long-term vision: a housing super app that makes buying, selling, and renting as seamless as booking a restaurant.

Exiting the iBuying business was painful but clarifying. It refocused Zillow on its core mission and freed capital to invest through the downturn.

Companies that spend a downturn firefighting emerge from it behind — those building through it come out ahead.

The 2022 housing market in context

• Mortgage rates rose faster than at any previous point, adding ~$500/month on a $350k home at 6% vs. 3%
• Inventory and prices stabilised, but affordability hit a 15-year low
• Housing is durable: millions still move regardless of conditions — some must, some choose to wait
• Slowdowns shift demand toward rentals as buyers hold off on purchases
• Zillow's role: keep users informed and ready to act when conditions align for them

Why Zillow killed its iBuying business

• Zillow Offers had Zillow buying homes with its own capital, renovating, then reselling
• The business was too risky, too volatile, and served too few customers
• Exiting freed the company from exposure to market swings and freed capital for core priorities
• Zillow then partnered with Opendoor to keep the instant-offer option available to customers — without holding the balance-sheet risk
• Lesson: you can offer customers everything without having to do everything yourself

Building the housing super app

• The real estate transaction is fragmented, non-digitised, and highly analog — even for basic steps
• Touring a home still requires coordinating four people across multiple phone and text threads to schedule a single visit
• Zillow's goal: make home touring as simple as booking a restaurant reservation — one click, done
• Mortgages remain paper-heavy and in-person; digitising them is part of the same vision
• The super app combines touring, financing, and agent matching into one ecosystem
• Simpler transactions should increase mobility and make homeownership more equitable for first-time buyers

Strategy under pressure: don't chase the market

• Constantly pivoting to match current conditions jars employees and destroys strategic momentum
• Zillow's approach: fix the long-term destination, then navigate whatever weather comes
• Watching the Fed's every move is distracting for leadership, employees, and strategy — focus instead on what you can control: the customer experience
• $3.6B in cash gives Zillow the runway to keep investing through the downturn while others cut
• Companies that only manage the present fall behind when conditions improve

Lessons from founding in hard times

• Susan Daimler co-founded SeatGuru post-9/11 and Bifolio during the Great Recession — both durable businesses born in hostile environments
• Challenging markets sharpen customer need for transparency and better tools
• Being ready when conditions improve matters far more than reacting perfectly while they're bad
• The rubber-band effect: pandemic-era momentum that looked permanent snapped back — leaders should have anticipated it

Keeping entrepreneurialism alive at scale

• Zillow grew from 400 to 6,500 employees; founder ethos survived because it was embedded in culture, not just in titles
• Hire people at every level who tolerate failure and value big swings
• Combine legacy knowledge (what worked, what didn't) with fresh eyes that ask "why do we do it this way?"
• Constraints grow with company size — the antidote is hiring people who don't internalise those constraints
• You need mavericks, but not only mavericks
• Hard problems solved together build a stronger team foundation — stress that paralyses is contagious; action-orientation is too