With Zillow’s stock having already tripled in price this year, it’s been hard for some to get a handle on this week’s news that Australian billionaire James Packer’s has shelled out $298 million to take a 9.3 percent stake in the fast-growing listing portal.

Forbes contributor Neerja Jetley thinks “It is [a] fair bet that Packer is betting that real estate will be the same kind of electronic marketplace that has eliminated travel agents and dented the incomes of stockbrokers and car dealers. His sights must be trained on the estimated $69 billion in commissions that could slowly evaporate if Zillow does to real estate what Amazon did to books or Expedia to travel. It could be a long haul, but Packer is not a man in a hurry.”

While many real estate agents have voiced similar views that Zillow is out to “disintermediate” them, the company has gone out of its way to dispel such fears. Years ago, the company dropped the brokerage licenses it had obtained to ensure access to listings, and CEO Spencer Rascoff has said the company intends to stay focused on growing its audience.

“Selling access to our audience is the big pie,” Rascoff  said in a conference call with investors last month in conjunction with the release of second-quarter results.

Two-thirds of Zillow’s revenue still comes from its selling “Premier Agent” subscriptions to agents, who get leads and increased visibility from the site. While the number of Premier Agent subscribers as of June 30 was up 71 percent from a year ago, to an all-time high of 38,807, that’s a small fraction of the potential, Zillow’s boosters say. Revenue from Zillow’s mortgage business was up 126 percent during the same period, and Rascoff said that based on its prominence in the mobile arena, Zillow could grow its mortgage business by ten- or twentyfold.

Those factors — along with Zillow’s recent moves to grow its presence in the rentals space — may be a bigger part of Packer’s analysis than expectations for industry disruption. Source: forbes.com.


Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription