Re:Zillow lost money because they weren't willing to lose money
by faizshah on Saturday November 27, 2021 @01:40PM
(#29362315)
Theres a good video here from a british hedge fund manager on why zillows real estate market making doesn't make sense: https://youtu.be/eDc4saE5m9k
The main insights are that market makers hold assets for a short period of time making money on the spread between buyers and sellers offers. Zillow had to hold on to houses for a long time and was speculating that the houses would be worth more in the future which is not market making.
The main insights are that market makers hold assets for a short period of time making money on the spread between buyers and sellers offers. Zillow had to hold on to houses for a long time and was speculating that the houses would be worth more in the future which is not market making.