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The Airbnb experience seem like a good story if it's done voluntarily. But now we have a giant corporation "scaling" it. It seems like a good business use-case.

The Airbnb experience seem like a good story if it's done voluntarily. But now we have a giant corporation "scaling" it. It seems like a good business use-case. But we already had Big Tech eating up the news. We may have Big Tech eating up the housing market. Can someone with knowledge in this space explain where this space is heading? Will the kind of Airbnb business inflate the housing market? Do people need to rent out their private living spaces in the future because paying for a property would become expensive?

sjg007 6y ago
Big tech is eating up housing both through AirBnb as well as Zillow, OpenDoor etc... Zillow and OpenDoor will buy your house basically at a "fair" price and you don't have to "fix" it up but really the advantage is that you get a 3 month window to close while you find a new place to live. This means you don't have to find an alternative rental in the meantime or sell your house on contingency. The definitions of a "fair price" and "fix up" will depend on your negotiation ability, demand etc... This model is eating up realtors margins. In some sense you might be able to arbitrage VC money here in the short term as OpenDoor and Zillow buy market share. In another sense you may want a realtor when you buy in a new market since you may not know the area and the regions future development plans. Yes you can find that out yourself but it's not easy to know the market. In the long run someone like OpenDoor will own the buy and sell side entirely, I think it is inevitable. Worse case OpenDoor has to pivot to rentals on their inventory. VCs will invest billions in this and shape the market for sure. Oh and you will be able to get a Zillow mortgage or OpenDoor one.. housing in the very real sense of the world will become vertically integrated. In that world you might get a better deal than dealer financing but you'd have to do your homework.

sjg007 6y ago

Big tech is eating up housing both through AirBnb as well as Zillow, OpenDoor etc... Zillow and OpenDoor will buy your house basically at a "fair" price and you don't have to "fix" it up but really the advantage is that you get a 3 month window to close while you find a new place to live. This means you don't have to find an alternative rental in the meantime or sell your house on contingency. The definitions of a "fair price" and "fix up" will depend on your negotiation ability, demand etc... This model is eating up realtors margins. In some sense you might be able to arbitrage VC money here in the short term as OpenDoor and Zillow buy market share. In another sense you may want a realtor when you buy in a new market since you may not know the area and the regions future development plans. Yes you can find that out yourself but it's not easy to know the market. In the long run someone like OpenDoor will own the buy and sell side entirely, I think it is inevitable. Worse case OpenDoor has to pivot to rentals on their inventory. VCs will invest billions in this and shape the market for sure. Oh and you will be able to get a Zillow mortgage or OpenDoor one.. housing in the very real sense of the world will become vertically integrated. In that world you might get a better deal than dealer financing but you'd have to do your homework.