top of page

CoStar acquires Homesnap, a DOJ win, and out-of-state investor markets

When COVID-19 first appeared, people speculated ๐Ÿค” there could be another 2008-like recession that could affect the housing market; after all, much of the country was in lockdown ๐Ÿ”’ and not out shopping ๐Ÿ›’. Not only did a recession not happen ๐Ÿ™…โ€โ™‚๏ธ then but the United States has been in a seller's ๐Ÿก market ever since COVID-19 hit. That's led many to wonder if we're in another housing bubble ๐Ÿ’ญ. With nationwide double-digit (nearly 13%) home price appreciation โ†—๏ธ from last year, we might be. And if we are, when will the bubble burst?

The pandemic has shifted the pecking order of the real estate industryโ€™s location-location-location ๐Ÿ“ axiom for many homebuyers โ€” high-cost and high-density urban ๐ŸŒƒ is out, while suburban is back ๐Ÿ”™ in vogue and rural ๐Ÿž is experiencing a bit of a revival. Many real estate investors were serendipitously ahead of this shift even before the pandemic started, driven by both affordability and an affinity for overlooked ๐Ÿ‘€ markets.

CoStar Group is set to buy Homesnap ๐Ÿ‘Œ, an app and technology ๐Ÿ–ฅ provider for residential real estate agents, for $250 million, the Wall Street Journal ๐Ÿ—ž reported. The all-cash ๐Ÿ’ต acquisition is expected to close later this year ๐Ÿ—“.

Buying your first home is fraught ๐Ÿ˜ง, and thatโ€™s especially true when the market is as competitive as it is right now. Interest rates are low ๐Ÿ“‰, supply is down โ†˜๏ธ, and demand from new buyers is high โ†—๏ธ. The market is so hot ๐Ÿ”ฅ that in September, 1 in 5 houses in the U.S. sold above its initial list price, according to data โŒ— from Zillow.

This past July โ›ฑ, the U.S. Department of Justice (DOJ) announced a major lawsuit โš–๏ธ and settlement with the National Association of Realtors (NAR) about anti-competitive ๐Ÿ™…โ€โ™‚๏ธ practices. According to Stephen Brobeck, a senior fellow at the Consumer Federation of America (CFA), โ€œThe settlement will discourage blatant discrimination against discount brokers and the steering ๐Ÿ‘‰ of buyers ๐Ÿ› to high-commission properties ๐Ÿ˜, but will fail to significantly increase real price ๐Ÿ’ฒ competition."



bottom of page