Zillow Group announced Monday that it will temporarily pause home buying through its Zillow Offers business in response to stay-at-home directives from various locales related to the coronavirus crisis and uncertainty in the U.S. real estate market.
Coronavirus Live Updates: The latest COVID-19 developments in Seattle and the world of tech
The move comes several days after Redfin announced a similar plan, suspending making offers on homes through its RedfinNow business.
Zillow Offers operates in 24 markets. The strategy, which was rolled out a year ago, brought in $603.2 million in revenue in fourth-quarter earnings reported last month. The Seattle-based company sold 1,902 homes and purchased 1,787 homes, ending the quarter with 2,707 homes on its balance sheet. That inventory had been reduced to 1,860 homes as of March 19.
Zillow stock was up about 13 percent in trading on Monday.
“Our top priority is ensuring the safety and health of our employees, customers, and partners,” Zillow Group CEO and co-founder Rich Barton said in a news release. “Given the concerns for public safety and rapid developments by governments that restrict local real estate activities, we determined it was prudent to pause our home buying to preserve our capital.
Zillow plans to restore the Offers business to full operations once health concerns pass, according to Barton.
RELATED: Redfin shares tips for ‘Selling Homes in a Virtual World’ to address COVID-19 real estate concerns
The company will continue to market and sell homes through Zillow Offers, but will temporarily suspend plans to open additional Zillow Offers markets. To protect its customers and partners, open houses for its homes in all markets were suspended last week.
The company is relying on Zillow 3D Home technology to make virtual home tours easier, as well as virtual consultations with Zillow’s local broker and Premier Agent partners.
“Zillow Group is well positioned to navigate these unprecedented times,” Barton said. “We already slowed our pace of acquiring homes over the past month, while our pace of home sales in the quarter accelerated. We have a strong balance sheet and cash position, and are taking proactive steps to reduce spending to offset the important financial support we’re giving our industry partners so we may continue to best serve our mutual customers.”
