Zillow is a real estate and rental marketplace with a real estate search engine for US properties. With more than 200 million monthly visitors, Zillow is the most-visited real estate website in the USA. Four out of five homes in the US having been viewed on Zillow at some point.
Zillow’s platform connects users — homeowners, buyers, sellers, renters, landlords, real estate agents, mortgage professionals, and property managers — with each other via its website and apps.
With no cost to personal users, this is how the platform makes money.
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What does Zillow do?
Zillow offers an online real estate and rental marketplace, connecting homeowners, buyers, sellers, renters, real estate agents, and related service providers such as mortgage professionals and property managers.
Zillow and its affiliates collectively provide customers with an on-demand experience for buying, selling, renting, and financing properties. Zillow also provides information on mortgages and home improvement.
Users can get property rental or purchase estimates, and find real estate professionals and service providers such as real estate agents, property managers, and home inspectors.
Zillow has a large repository of vital information on real estate in the US, including properties for rent or sale as well as those not currently on the market, making it a great place to find detailed information on listed properties.
How does Zillow work?
Zillow's real estate marketplace listing millions of for-sale and rental listings, connects practically all parties in the real estate sphere, including homeowners, buyers, sellers, renters and landlords. Zillow enables free listing of homes that are for sale—by owner or agent—and properties for rent. Customers get free information and services related to selling, buying, renting and financing real estate from ZIllow. It also provides a host of related services such as estimates of home values and other detailed info on listings. Zillow is a place for individuals and businesses to find and connect with local professionals.
Zillow operates mainly through its zillow.com website. But there are a suite of over 20 mobile and real estate apps under the Zillow Group umbrella.
How Zillow makes money
Zillow makes money by selling advertising on Zillow.com and the mobile app. Key advertisers on Zillow include property management companies, real estate agents, and mortgage lenders, although other brands outside the real estate industry also advertise on the platform.
Ads from property management companies
Zillow makes money when property management companies advertise their listings on the Zillow Rental Manager, which covers websites from Zillow, Trulia, and HotPads. In return, Zillow directs prospective renters who are qualified leads to the advertisers, helping them maximize their return on the advertising dollars spent on Zillow.
Premier services for real estate agents
Real estate agents can get Zillow's Premier Agent branding on the website, making it Zillow's largest source of revenue.
Premier Agents enjoy multiple listing service searches, client reviews, past sales, agent bios, photos, and videos. Premier Agents are supported with a customer relationship management system that enables them to track Zillow users that have shown an interest in working with an agent.
Ad sales to real estate agents
Real estate agents purchase advertising on the Zillow platform to target home buyers and sellers in their local markets. They also buy ads to increase the visibility of property listings on Zillow.
Ad sales to mortgage lenders and other businesses
Zillow sells advertising on the site to various businesses, including mortgage lenders. Mortgage lender ad revenues are based on cost per click (CPC) or the cost per thousand impressions (CPM). Ad revenue from others depends on the number of monthly unique visitors on the Zillow site and apps.
Zillow also earns revenues from Mortech, the subscription-based mortgage software company owned by the Zillow Group, and from offering lending services through the Mortgage Lenders of America.
Future growth engine
Zillow's strategy for the future takes the company back to its roots. This means doubling down on agent lead generation and increasing revenues from real estate commissions.
The biggest driver of Zillow’s growth is its premier agent business. Zillow plans to double it by 2025, aiming for an additional $1.5 billion flowing from real estate agents to Zillow. Increasing the transactions for premier agents is about connecting agents and consumers so Zillow earns a commission. Selling more consumer related services like mortgage and title are also part of the plan.
Zillow has also recognized that rentals are a large, ongoing market opportunity. Renters move more often compared to homeowners. Property owners have the constant need to advertise and spend money on lease concessions in order to fill their units.
Zillow competitors include Redfin, Realtor.com, HotPads, Auction.com, CoreLogic Matrix, and Trulia.
Redfin is a discount real estate brokerage, and one of the largest competitors of Zillow. It has a wide network of realtors — over 100 — spread across the US and Canada. Sellers pay Redfin a 1.5% listing fee and buyers 1% when they buy through Redfin.
Realtor.com also offers online real estate services with website and mobile with a comprehensive list of for-sale properties. It offers information and tools that support informed real estate decisions. Realtor.com allows property owners to track their home values over time, manage home improvements, and view similar properties in their neighborhoods.