Google Listings Aren’t a Threat to Home Stocks

Housing technology companies are offering far more than just online listings—and those expanded services act as a buffer against disruptions in the residential real estate market.

A turf war over the online home listings business has been brewing for some time. Then Google entered the fray.

As part of a pilot program, the search giant began placing home listings at the top of certain Google search results. News that Google might push deeper into home listings sent shockwaves through the stocks of companies that currently dominate the space.

On December 15, after reports of Google’s test spread over the weekend on social media, Zillow Group’s market value dropped by about $1.5 billion. Shares of CoStar Group, the parent company of Homes.com, fell to their lowest level in more than three years. Neither stock has fully recovered since.

The selloff, however, appears unwarranted.

A Small Experiment, Not a Market Takeover

There is no indication that Google’s home listings feature will see a broad rollout. The test itself is limited in scope: listings have appeared only for mobile users in select cities such as San Francisco and Miami. A Google spokesperson described it to Barron’s as “a small experiment,” without specifying when it began or how long it would last.

Wall Street analysts largely agree that investors overreacted. Alphabet, Google’s parent company, has previously experimented with home listings—efforts that ultimately faded away. Still, as Benchmark analyst Daniel Kurnos put it, “No one likes it when an 800-pound gorilla comes sniffing around.”

The episode reflects deeper anxieties about disruption in the housing technology sector, driven not only by Google but also by the rise of artificial intelligence. Agents told Barron’s they are already receiving increasing referrals—of mixed quality—from AI-driven chat platforms.

More disruption is coming, and companies are preparing for it.

Listings Are Only One Piece of the Business

Major housing platforms—Zillow, Rocket’s Redfin, and CoStar’s Homes.com—are no longer just house-browsing websites. Each has expanded into adjacent services that help insulate them from changes in how buyers search for homes and how agents advertise.

Realtor.com, which also operates a listings platform, is owned by Barron’s parent company, News Corp.

Among the big players, analysts say Zillow’s core business appears the most insulated from increased competition, thanks to strong organic traffic and brand recognition. According to web traffic measurement firm Semrush, Zillow is the most-viewed real estate website in the United States.

In recent years, Zillow has pivoted away from relying primarily on agent listing marketing. Instead, its main sources of growth now come from mortgage services and rental listings. The company also offers agent-focused products such as workflow management software and seller-oriented listing tools.

“The combination of the business that we’ve built is far more diversified than it was five years and 10 years ago,” Zillow Chief Financial Officer Jeremy Hofmann said at a December technology conference.

Benchmark’s Kurnos rates Zillow’s Class A stock a Buy, with a $95 price target—nearly 40% above its recent price of $68.54. “To think that Google would somehow displace the most complete end-to-end solution in the marketplace with the strongest and stickiest agent product suite seems rather far-fetched,” he wrote.

Homes.com and CoStar’s Long Game

CoStar’s Homes.com was positioned as an agent-friendly alternative to dominant listing sites, focusing on services for sellers’ agents rather than lead generation. CoStar acquired Homes.com in 2021 and announced its aggressive expansion with a Super Bowl commercial in 2024.

Usage has grown since then—but so has spending. CoStar’s marketing budget reached $1.36 billion in 2024, up from $684 million in 2022. That surge in spending has weighed on earnings, contributing to stock declines. CoStar shares are down 26% since the Friday before the 2024 Super Bowl and fell another 6% in 2025.

Homes.com remains a relatively new arm of CoStar’s broader commercial real estate business, which includes data analytics software and marketing platforms. Fears of technological disruption have only added to recent pressure on the stock.

Still, CoStar is betting heavily on innovation. According to CEO Andy Florance, 50% of Homes.com’s software development is now focused on artificial intelligence. “AI offers transformative opportunities to unlock tremendous value in real estate,” he said on an October earnings call.

Rocket, Redfin, and Vertical Integration

Rocket, one of the largest mortgage originators in the U.S., made a major move into listings with its 2025 acquisition of Redfin. By the third quarter, more than one in ten of Rocket’s retail loan closings came from customers who used both Redfin and Rocket, CEO Varun Krishna said. “We expect this to only increase,” he added.

Even if competition intensifies or demand for listings portals weakens, Rocket maintains a dominant position in mortgage origination and servicing. Its $14.2 billion all-stock acquisition of loan servicer Mr. Cooper brought an estimated one in six U.S. mortgages under the combined companies’ management.

That refinancing opportunity is one of the reasons Rocket’s stock surged 72% in 2025.

A More Competitive—but Stronger—Ecosystem

For real estate professionals, increased competition may ultimately be beneficial. Wendy Monday, a broker at Nashville-based Onward Real Estate, says she currently advertises on Zillow but is watching Google’s experiment closely.

“The more platforms there are,” she said, “the sharper their tools all have to be.”

For now, Google’s test looks less like a threat—and more like a reminder that housing technology companies have evolved well beyond simple listings.

Source: Barrons