A Shrinking US Housing Market Means Upheaval for Buyers

Companies like Compass, Rocket, and Zillow are trying to create one-stop shopping venues.

The housing market is barreling toward its third bad year of home sales. Once demand roars back, real estate transactions could look different for buyers, sellers, and investors. Anemic home sales are accelerating a housing market reconfiguration long in the making. In the coming years, it may be more common to purchase a home from one of the big public builders than a local developer, or secure a mortgage from the same portal you used when shopping for a home.

Big real estate companies are building digital platforms to keep more parts of the home purchase transaction under one roof—and taking business from real estate brokerages and mortgage lenders. “Anything that makes things easier for people—that’s where the world is moving,” says Tim Bodner, PwC’s real estate deals leader.

The fight for dominance recently spilled into the courts. Compass, the largest U.S. brokerage by sales volume, sued listings portal Zillow Group over new rules regarding listings that are initially viewable only by its agents and their clients. The lawsuit isn’t just a fight over wonky listing rules, but a conflict about the shape of the future housing market.

Consumers have been backing away from buying a home for several years. The number of existing homes sold fell to nearly 30-year lows in both 2023 and 2024. In the first five months of 2025, homes sold at an average seasonally adjusted annual rate of about 4.1 million, down from more than six million as recently as 2021, according to National Association of Realtors data.

The whole sector is under pressure until sales climb to at least five million, says Leo Pareja, CEO of brokerage eXp Realty. That’s far away: The Mortgage Bankers Association expects existing home sales to ramp up in the coming years but to remain below five million through 2027, as prices hold firm and mortgage rates remain above 6%. The path ahead for consumers will look increasingly streamlined—and is rife with both opportunities and risks.

Shifting Winds

 It isn’t just buyers and sellers backing out of the market. The National Association of Realtors, the industry’s largest trade group, is budgeting for its membership to decline to 1.2 million in 2026, from nearly 1.6 million as recently as 2022. That’s in part “due to the housing market’s current headwinds,” a NAR spokesperson says.

“There’s going to be sort of a reckoning” if sales remain slow, says Columbia Business School professor of real estate Stijn Van Nieuwerburgh. “Probably a bunch of people are going to quit this profession altogether.” Where some smaller brokerages see trouble, others see buying opportunities. Compass, a $3.2 billion real estate brokerage based in New York, grew its ranks of principal agents nearly 42% in this year’s first quarter from the year prior, largely because of its acquisitions. “Most brokerages are really struggling financially,” says Rory Golod, Compass’ president of growth and communications. “They don’t have the size, the scale, and sort of the balance sheet to get through this.”

Consolidation is coming to homebuilding, too. At a time when more builders are offering buyer incentives or slashing prices, the big players’ economies of scale allow them to keep costs lower. “In a slower and choppier market, mergers and acquisitions get more common,” says Ali Wolf, chief economist of real estate research firm Zonda. Publicly traded home builders comprised 52% of all new home sales in 2024, a larger share than anytime since at least 2005, Zonda data show. That could rise as high as 65% in the future, says Wolf.

Perhaps most emblematic of where housing is headed is the coming unification of Rocket, the nonbank lender best known for mortgage origination, with mortgage servicer Mr. Cooper and brokerage and home-listing portal Redfin. The three companies “realize that we are stronger together than we would be apart,” says Varun Krishna, Rocket’s CEO. The combined company will be the largest mortgage servicer and second largest lender in the U.S., according to Inside Mortgage Finance data. Redfin, meanwhile, gives them “the brand name and real estate brokerage that they never had before,” says Wedbush Securities analyst Jay McCanless.

Across categories, consumers now expect a more personalized experience, says David Steinbach, global chief investment officer of Hines, a real estate investment manager with $90 billion in assets. “That consumer taste for a better service, better outcome— which only data can do—means the scaled groups are going to win. The big are going to need to get bigger in order to better serve the needs.”

The Future

Companies that derive earnings from the homebuying process—such as listing portals, mortgage companies, and brokerages—have long looked for ways to capture a bigger slice of the pie in a fractured housing market. They may have finally settled on a recipe.

Zillow emerged from the 2021 failure of its volatile business buying and selling homes with a new plan: build a “housing super app” offering a range of housing services to buyers, sellers, renters, and agents in one place.

It hasn’t been a smooth ride. Zillow stock is down 5% this year, and 65%  below its pandemic high-water mark. But its push to integrate mortgages— whether through a mortgage marketplace or a lending arm of its own—into the buyer experience, along with investments in rentals and tools for agents, is finally paying off.

Zillow expects to be profitable under generally accepted accounting principles in 2025 for the first time since 2012. “The silver lining of a bad macro is it forces you to really be crisp about what’s working and what’s not working,” says Zillow CEO Jeremy Wacksman.

In the company’s super-app future, the homebuying transaction will never leave the company’s orbit. The whole process—shopping, hiring and communicating with an agent, talking to a loan officer, making an offer, getting a mortgage, and closing—will happen “in the palm of your hand inside an app like Zillow,”Wacksman says.

Across the spectrum, big players in real estate are envisioning what a less fractured housing transaction looks like. Buyers shopping with a Compass agent now have access to a dashboard to keep track of their communication, forms, to-dos, and referrals.

Realtor.com—a home-listings portal run by Move, which, like Barron’s, is owned by News Corp—sees an opportunity “to create an open marketplace, not just for real estate services, but for mortgage services and more,” says Move CEO Damian Eales. “This part of our business will evolve quite significantly in coming years.”

The Consumer

Mega-companies come with both opportunities and risks for consumers. Rocket, Zillow, and others see the opportunity to cut down on friction for buyers and sellers by uniting disparate parts of the housing ecosystem. “The more integrated the experience is, the easier it is to actually lower costs, and then pass on savings to the person who matters most, which is the consumer,” says Rocket’s Krishna.

That isn’t the way some left-leaning politicians see it. In a letter to the Department of Justice and the Federal Trade Commission, five senators including Elizabeth Warren (D., Mass.) and Bernie Sanders (I., Vt.) said that Rocket’s Redfin and Mr. Cooper deals “may reduce choice and raise prices for American families in the housing market” at a time when costs are already high.

“I couldn’t disagree more,” says Rocket’s Krishna.

No matter how a buyer purchases a home, it pays to consider the competition. Freddie Mac in 2023 said that borrowers who compared quotes from at least four mortgage companies stood to save as much as $1,200 a year compared with those who only sought one offer. “Sometimes the way these platforms work is they basically exploit impatient consumers,” says Columbia’s Van Nieuwerburgh. “It’s nice and it’s convenient, and they basically end up overpaying for that convenience.”

But bigger companies could also cut costs, particularly when it comes to home-building, says Van Nieuwerburgh. “There’s a huge number of very small construction firms that are frankly very inefficient,” he says. Deregulation efforts “could potentially lead to some much-needed consolidation,” resulting in more homes getting built—and more options for buyers.

As companies converge on similar visions of the user experience, they diverge on how it will be structured. Take private listings, for example: Advocates like Compass say sellers should be able to test the market before listing to the whole world, while critics like Zillow and eXp say such networks disadvantage buyers. The debate has split the industry down the middle, and is already changing the homebuying process. While Compass encourages sellers to list privately first, Zillow and Redfin have banned listings that aren’t immediately syndicated.

The industry’s evolution won’t stop with consolidation. “You finally have industry participants…all rethinking how things should work and criticizing existing processes that have been an afterthought for the past century,” says KBW analyst Ryan Tomasello.

Source: Barron's

Airbnb scams: criminal activity on big tech platforms

Big tech sharing economy platforms like Airbnb and Uber are marketed as trustworthy, but a new book by a South African media scholar argues that they are highly vulnerable to scammers who spread delusive speech (a form of disinformation, designed to deceive by criminal intent).

Julie Reid draws from first-hand accounts and over 600 cases from around the world of victims lured into scams or physical danger by fake Airbnb reviews and listings, providing a detailed case study. We asked her five questions about her book.

HOW DO THE SCAMS WORK?

Airbnb is the world’s largest accommodation-sharing platform. It connects property owners who want to rent out their homes with travelers looking for alternatives to traditional hotels. The company recently expanded its offering and now facilitates the booking of other services like personal trainers or caterers along with accommodation rentals.

Airbnb scams happen in several ways. The most obvious is the phantom listing scam. The scammer constructs a fake but attractive listing on Airbnb and accepts payments from unsuspecting guests. It’s only when guests arrive at the address that they discover the property doesn’t exist. Scammers have also learned to navigate around Airbnb’s review system. Fake positive reviews are produced by scam host networks, making them appear to be authentic.

Bait and switch scams are also common. Here the scam “host” contacts the guest on check-in day claiming the reserved property is suddenly unavailable. They offer alternative accommodation, which the guest later discovers is not as good as the original property they’ve paid for (which is often fictional). The guest pays for a premium rental but is forced to stay in a property that might be unsafe, unclean, or missing amenities.

Scam hosts use misleading, plagiarized, or artificial intelligence (AI)-generated property images and fake descriptions along with fake personal profiles and aliases.

Delusive tactics also redirect guests away from the secure Airbnb payment portal to alternative payment methods. The scammer disappears with the money.

But the danger isn’t limited to financial crimes. The platform’s business model is premised on staying in a stranger’s private property, which can put guests’ personal safety at risk.

Criminal hosts can lure targets into dangerous environments. Once checked in, guests are isolated from public view, housed in a property to which the host has access.

I’ve assessed multiple cases where Airbnb guests were assaulted, robbed with no signs of forced entry, raped, murdered, made victims of sexploitation, extortion or human trafficking, or held hostage.

HOW DOES THE DISINFORMATION WORK?

I consider delusive speech a subset of disinformation because it presents intentionally misleading content at scale. But it differs from disinformation in its intentions. It isn’t done to promote a particular cause or gain ideological, military, or political advantage. Delusive speech is motivated purely by criminal intent or nefarious financial gain.

Delusive speech works by hiding in plain sight on platforms we think we can trust, like Airbnb, Booking.com, Uber, and others. Often, it’s indistinguishable from honest and genuine content. When users browse Airbnb listings for holiday accommodation, they’re presented with numerous options. A fake property listing looks, sounds, and feels exactly the same as a genuine one.

This happens on a platform that has built its brand narrative around the concept of trust. Scammers exploit these digital contexts of pre-established trust. When users log on to popular e-commerce or sharing economy platforms, they’re already primed to pay for something. It becomes relatively easy for scammers to delude targets into parting with their money.

WHAT CAN AIRBNB DO ABOUT IT?

Airbnb already has several trust and safety mechanisms in place. They include rapid response teams, an expert Trust and Safety Advisory Coalition and travel insurance for guests. The company claims to be trying to stop fake listings with machine learning technology.

Sadly, none of these mechanisms work perfectly. While Airbnb promises to verify properties and host identities, my analysis exposes flaws in these systems. Scammers easily bypass verification tiers through aliases, forged documents and AI-generated material. Airbnb has admitted it needs to address the failures of its verification processes.

My analysis uncovered how scammed guests are routinely denied the opportunity to post reviews of problematic rentals. Opaque terms of service and content policies allow Airbnb customer service agents and executives to justify censoring negative but honest guest reviews.

This means dangerous and fraudulent activity goes publicly unreported and unreviewed, leaving future guests vulnerable. I argue that Airbnb’s review curation mechanisms should be revamped according to internationally recognized human rights frameworks that protect freedom of speech. This would allow for more honest accounts of guest experiences and create a safer online environment.

Perhaps the most common complaint I encountered was that Airbnb doesn’t remove offending listings from its platform, even after a scammed guest provides evidence that the listing was posted by a fraudster. Airbnb must develop an urgent protocol for swiftly removing offending listings when discovered, to protect future guests from falling victim to the same scam trap.

WHAT CAN USERS DO TO PROTECT THEMSELVES?

Travelers can protect themselves by being extra cautious. Ask around. Seek recommendations from people you know and trust, and who can verify that the property you are booking actually exists and that the host is trustworthy.

If that isn’t an option, consider an established hotel instead, but book directly with the hotel and not via third party sites like Booking.com where listings can easily be faked. Check on Google Street View to make sure the property is where it claims to be.

Either way, have a Plan B in case things go wrong. Prepare ahead of your trip by deciding what you will do if you find yourself in an unsafe situation. And always, always, buy travel insurance.

IS IT PART OF A BIGGER PROBLEM?

I assessed several digitally initiated scam categories in this book. While my main case study focused on Airbnb, the problem of delusive speech online isn’t unique to this platform. Delusive speech is now carried by all major tech platforms integral to everyday life. In the book, I also highlight how scammers operate in every corner of the internet, including dating apps like Grindr, Tinder and Hinge; ride-sharing services like Uber, Lyft, and Bolt; travel sites like Booking.com and Hotels.com; and social media platforms like Facebook, Instagram, and YouTube, among others.

I hope that these examples will boost awareness of the risks of using these apps and sites.

Julie Reid is a professor at the University of South Africa.

Source: Business World

Reducing emissions and air pollution from informal brick kilns

INTRODUCTION:

In many low- and middle- income countries, it is commonly believed that weak state and regulatory capacities limit the ability to reduce pollution and mitigate climate impact. In Bangladesh and across South Asia, most brick manufacturing takes place in informal, traditional coal- fired kilns. These kilns are among the largest sources of greenhouse gas emissions and air pollution, leading to an enormous public health burden.

RATIONALE:

In Bangladesh, efforts to improve the brick kiln industry over the past 30 years have had limited success. Our past work suggests that a correctly operated zigzag kiln (a traditional kiln type that accounts for 81% of the sector) can not only improve efficiency but also increase kiln profits. However, most zigzag kilns in Bangladesh are incorrectly operated, leaving these social and private benefits unrealized. Improving energy efficiency presents an alternative strategy to reduce emissions and pollution while also delivering productivity gains.

RESULTS:

We developed a low- cost intervention to improve the energy efficiency of zigzag kilns and conducted a randomized controlled trial (RCT) of the intervention among 276 kilns in Bangladesh.

Our study included a control arm and two intervention arms (a “technical” arm and a “technical+incentive information” arm). All kilns assigned to both intervention arms received information, training, and technical support to adopt operational improvements that improve fuel combustion and reduce heat loss in the kilns.

These improvements specifically targeted how coal is fed during the firing process and how bricks are stacked inside the kiln, along with several other aspects of operation.

Kilns assigned to the “technical+incentive information” arm also received explicit information regarding the business rationale for incentivizing workers to adhere to the new practices. There was high demand for the intervention, with 65% of intervention kilns adopting the intervention’s recommended firing and stacking practices.

Notably, 20% of control kilns also adopted these practices, bolstering the interpretation that demand was high. There were no differences in adoption between the two intervention arms and no use of incentives or benefits in the “technical+incentive information” arm. We studied the intention- to- treat (ITT) effect of random assignment to the intervention, as well as the impact of the intervention after adjusting for compliance using an instrumental variables (IV) framework. Among compliers, the intervention led to substantial reductions in the amount of energy used to fire bricks (23%) and corresponding reductions in carbon dioxide (20%) and particulate matter with a diameter of <2.5 μm (20%).

These gains were achieved without any evidence of a rebound in energy demand. Kiln owners also benefited financially from the intervention; production of the highest quality category of bricks increased in intervention kilns and spending on fuel per brick declined. The primary costs of the RCT were the training costs and technical support costs throughout the season. Using a social cost of carbon of 185 USD per metric ton to value the reductions in CO2 emissions, we find the benefits of the intervention outweighed the costs by a factor of 65 to 1, and that these reductions were achieved at an average cost of 2.85 USD per ton.

CONCLUSIONS:

Our study demonstrates that meaningful reductions in emissions by traditional kilns are achievable, even in the absence of stronger regulations, if they can be made financially attractive to private kiln owners.

Source: Science 08 05 2025