By George Whitridge | @GeorgeOfARK
On Zillow’s third quarter earnings call, CEO Rich Barton stated, “In September, we saw the pace of existing home sales climb to the highest level since 2006, exceeding 6.5 million annualized units,” as shown below. We believe that the combination of increased demand for personal space during the coronavirus crisis and mortgage rates at 50-year lows has contributed to the surge in home sales.
In our view, sales will continue to rise as digital platforms reduce the friction associated with buying and selling homes. During the third quarter, for example, nearly two thirds of the home purchases on Zillow Offers closed digitally with an online notary. In our view, next generation real estate platforms like Zillow, Opendoor, and Redfin will continue to simplify the home buying and selling processes, adding significant liquidity to the real estate market during the next five to ten years.
Catherine Wood, ARK Invest CEO, is a shareholder of 24/7 Wall St. LLC.