When an institutional investor like Blackstone or Blackrock or Colony Capital calls your phone to express interest in an asset you own, I can all but guarantee you that you are in a distressed position and looking to sell.

They have enough experience, data, and skill to time the market cycle. Companies like Zillow do not.

Zillow doesn't have experience or data in the real estate market? But, investors traditionally tied to securities do?

One seems like an entrenched data-hoarder. The other seems like a "we're smart enough to pivot into this" group.

Blackrock has trillions in assets but only 60 billion in real estate. They are under-invested in the sector but will buy a fire sale.

They paid above market for these houses in cash in order to get them and we don't know how much above market, only they and their AI know, that's what's causing them all the fuss now.

Right so even with AI technology and directly owning much of the housing data in the US, they still couldnt make a profit. Any time you buy a house to flip it you are paying a premium in hopes to make a greater premium. Instead they are making a loss. Thats not a good market signal.

From what i've read about all their investment regarding this issue, many of the homes they purchased also needed extra investment/rehab. I think they tried their hand at automation/ai purchasing as they had a lot of data but something fell really short of expectations. What Z did is a bit outside of the current market norms so i wouldn't really use it as a market signal, i'm looking at it more as their idea/system just fell short. But at the same time i was expecting the housing market to go lower into the start of this year, boy was i wrong as the market dynamics changed fast.

Sure that makes sense, they thought they could power through not putting in the sweat equity and they were wrong. Thats definitely a reality.

Sure, but that doesn’t mean that the average person can acquire a house for cheaper today. And that’s really the only part of the story that matters

Never suggested that. Just that there being buyers matched with sellers (there always are as that is a requirement of a market to exist regardless of its direction in price) doesnt mean the market is bolstered.

However, to me it makes sense that theres some softness in what Zillow tried to do because rates are likely to rise in the next year or so and most people know that. Thats going to put pressure on lending which effects housing demand. Their AI might be top notch but they probably just timed the whole market poorly.

Does imply the market is cooling though or Zillow would not be unloading this hot turd (ha ha, sorry).

To be sure, none of us will be buying one of their distressed properties though.