On November 6th while much of the nation was tuned into the midterm elections, real estate platform Zillow's stock fell 20 percent after the company announced its quarterly revenue is projected to miss its target.
Market watchers and investors' concern about the housing market slowdown did not have their worries allayed by the news. Zillow closed out the day with a closing price of $41.04 per share, 20 percent more than the day's low of $32.40 per share. Redfin's stock dropped as much as 6.5 percent in aftermarket trading, according to Fortune's reporting. At its lowest point, Zillow stock was down 51 percent from its 52-week high, and Redfin was down 53 percent. Relatedly, home builder stocks and home supply store chain stocks are also taking a tumble.
“Zillow Group is undergoing a period of transformational innovation,” Zillow CEO Spencer Rascoff said in the company’s earnings release. “We believe that these changes will have positive long-term effects for consumers, our industry partners and our business. It will take time for advertisers to adapt to these changes, but we are confident that they set us up for long-term growth.” During that expansion, however, Zillow and Redfin have had to face dual headwinds in rising interest rates, which can deter home purchases, and in slowing home purchases.