{"id":594,"date":"2019-11-05T06:00:00","date_gmt":"2019-11-05T06:00:00","guid":{"rendered":"https:\/\/www.realtrends.com\/blog\/2019\/11\/05\/the-housing-market-company-valuations-low-interest-rates\/"},"modified":"2025-03-13T02:05:37","modified_gmt":"2025-03-13T02:05:37","slug":"the-housing-market-company-valuations-low-interest-rates","status":"publish","type":"post","link":"https:\/\/www.realtrends.com\/blog\/2019\/11\/05\/the-housing-market-company-valuations-low-interest-rates\/","title":{"rendered":"The Housing Market, Company Valuations, & Low Interest Rates"},"content":{"rendered":"

The Housing Market, Company Valuations, & Low Interest Rates<\/h2>\n

Could the decisions being made in the financial and housing markets be d\u00e9j\u00e0 vu all over again?<\/em><\/h6>\n

First, we get Zillow, Redfin, and eXp getting huge valuations<\/a> on businesses that have made no discernable profit in their years of existence. For Zillow and Redfin, it\u2019s been over ten years since their founding.<\/p>\n

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Then, we get the entry of iBuyers<\/a>, who are on the way to buying tens of thousands of homes each year, now followed by Realogy, Keller Williams, and a host of others offering to purchase homes. We also have Knock and Ribbon advancing funds to assist people in buying their first or move-up homes.<\/p>\n

Just when we thought there might be some sanity, Compass<\/a> raises over $1.5 billion to fund the acquisition of agents, teams, brokerage firms, and an enormous tech platform. In doing so, they get a reported private market valuation of $6.4 billion\u2014more than Realogy and RE\/MAX LLC combined.<\/p>\n

Now, such firms as Divvy, ZeroDown, and Flyhomes are buying homes for people and pursuing a rent-to-own strategy (with some variations) for families who either can\u2019t qualify for a mortgage or lack a down payment, or both.<\/p>\n

Let\u2019s not forget how many housing-related shows are being broadcast these days, popularizing the buying and selling of homes, and how cool it is to be a real estate agent.<\/p>\n

Does it seem like there is the same crazy belief as in the past that housing prices have only one way to go\u2014up? Does it remind you of the way it was in 2005-2006?<\/p>\n

Someone asked me a great question the other day about interest rates. I didn\u2019t have a good, technical answer. He asked, \u201cIs it possible that we\u2019ll see negative interest rates in the United States, as they are now seeing in Europe and Japan?\u201d I responded that I found it hard to believe we would get there, but that I genuinely did not know whether it was feasible in our country.<\/p>\n

Think about these truths for a moment:<\/h4>\n