by ISHEKA N. HARRISON
The U.S. housing market is becoming more and more difficult to navigate for the average American looking to purchase a home. The dream of homeownership is not as attainable as it once was with the skyrocketing cost and demand for real estate, along with limited supply. Some say iBuyers — instant-buyer companies that use algorithms and technology to buy and resell homes quickly — and companies like Zillow are making matters worse.
Tech companies are buying houses at scale, a business practice that some experts say will ultimately make homes even less affordable for the average American. When it comes to Black Americans, the situation is even more dire.
Zillow is making a $450 million bond deal to fund its massive home purchases and others real estate companies such as iBuyers, Opendoor and Rocket Homes are all competing to get the most inventory, according to Vice.
“There’s almost an arms race to get the most inventory possible,” Daren Blomquist, vice president of market economics at Auction.com, told Vice. He described the iBuyer market as “almost frenzied,” adding “It’s less about making money off that inventory, at least initially, and more about who can get the most inventory the fastest.”
In August, both Zillow and Opendoor said they wanted to “drive rapid growth” in the real estate market. In a recent viral TikTok video, Las Vegas real estate agent Sean Gotcher talked about the impact an unnamed company was having on housing affordability by buying homes at scale, then strategically raising the market rates.
“Let’s talk about the housing crisis and let’s talk about some what ifs,” Gotcher said. “What if there was a housing company that everybody used … everybody knew of to look for houses … and so that company they just sit back and they collect all the data. … And let’s say that billion-dollar company uses that information to go into that zip code and start purchasing houses.”
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