Zillow Group‘s new-construction listings will be automatically syndicated to Redfin. The deal between the listing platforms comes as new construction listings form roughly 30% of the housing sales market.
The partnership is aimed at expanding the reach of homebuilder listings on Zillow, allowing Redfin’s brokerage customers to explore a broader range of new construction for sale, the two companies said on Tuesday.
“Zillow’s Community pages, in particular, help buyers understand the benefits of a new-construction home and give home builders a place to highlight all the amenities within a new-build community,” Owen Gehrett, vice president and general manager of new construction at Zillow, said in a statement.
“The partnership with Redfin extends this unique and valuable resource to a wider audience. It benefits home builders by expanding their reach to additional home buyers,” Gehrett added.
Zillow and Redfin’s partnerships come at a time when buyers are increasingly turning to new construction due to a rate lock-in effect caused led by high mortgage rates.
With inventory of existing homes dwindling and buyers’ demand for new construction rising, one-third of single-family homes available for sale were newly built homes – marking a record-high share, according to a Redfin analysis.
“This (Zillow partnership) is a win-win-win for our customers, agents and the builders who advertise with Zillow, who will now reach the homebuyers on Redfin,” Adam Wiener, Redfin’s president of real estate operations, said.
“The partnership provides a new revenue opportunity while allowing us to focus on what we do best, helping customers buy and sell homes with local Redfin agents,” Wiener added.
Zillow, the country’s top real estate listing platform, recorded a $22 million net loss in the first quarter of 2023. Its business model relies heavily on revenue from real estate agent advertising, and it’s been a sluggish housing market.
Traffic to its apps and site remained flat compared to a year ago and other metrics including – Premier Agent and Zillow Home Loans – were not as strong.
Despite weak financial earnings, executives said they will focus on making the home-buying transaction more seamless for the remainder of 2023.
Real estate brokerage and listings platform Redfin was also in the red in Q1 — reporting a $60.8 million net loss, an improvement on the $90.8 million lost in Q1 2022.
While executives at Redfin noted that the company is headed in the right direction, the firm is unlikely to get in the black in Q2 – with net loss projected to be between $35 million and $44 million.