In recent months, the housing crisis in America has been one of the myriad issues rumbling at the periphery of social media, but a recent TikTok by Las Vegas realtor Sean Gotcher has brought it front and center after he laid out an alarming theory about the shady business practices of iBuyer sites like Zillow and Redfin.

@seangotcher

##housing

♬ San Tropez – Illect Recordings

In Gotcher's TikTok, he lays out how an unnamed company could use the data of browsers to jack up housing prices in an area. In Gotcher's hypothetical, the company sees that buyers look at an area where homes cost $300,000, and what prices those buyers could actually afford. The company then buys 30 homes for $300k, but they then buy the 31st home for $340,000. This brings the value of the other 30 homes up, which they then flip at $340,000, turning a $1.2 million profit. Consequentially, real estate prices go up, and buyers are priced out of areas they could conceivably afford because of this shady practice by iBuyer sites.

iBuyers like Zillow have indeed been intentionally amassing inventory, as Vice reported in August. But as Gotcher's TikTok racked up 2 million views on that platform and additional millions on Twitter, the iBuyers stepped in to do some damage control.

Zillow gave a statement to Inman attempting to correct Gotcher's TikTok.

In a statement emailed to Inman Wednesday, the company characterized the video as an example of “misinformation and falsehoods.” The statement continued, saying “the simple truth is that through our services and tools, home shoppers have more power than ever before at their fingertips when buying, selling or renting their home because of the information we make available to them.”
“We pay market value for every home we purchase,” the statement added. “When we looked at homes that sold traditionally after they declined a Zillow Offer, we learned that on average, those selling traditionally sold for only .09 percent more than the Zillow Offer. And on every home that Zillow buys and sells, we are transparent: the purchase and re-sale prices are publicly displayed on the property page on Zillow.com.”

Redfin CEO Glenn Kelman also responded to the video's first Twitter repost with a six-tweet clarification of his company's business practices.

2 of 6: We'd never intentionally underpay or overpay for a home. It's madness to overpay for a single home in order to set a high-water mark for other sales. We reward the analysts who price homes on the accuracy with which they predict the ultimate sale price.

— Glenn Kelman (@glennkelman) September 18, 2021

4 of 6: What the video is right about is that iBuyers are counter-parties, when consumers are used to dealing with brokers acting as fiduciaries. iBuyers sit on the opposite side of the table from the owner, not the same side. This is why Redfin could never be a pure iBuyer.

— Glenn Kelman (@glennkelman) September 18, 2021

6 of 6: The star of the video -- and he is a star! -- is a loyal customer of one of the largest iBuyers.

— Glenn Kelman (@glennkelman) September 18, 2021

Despite the company's insistence that they were not doing anything untoward, many Twitter users responded to Gotcher's video by noting they had been seeing the type of price-fixing he laid out in their own areas.

I noticed this and paused my search. The over priced homes are sitting a little longer on market, now. Which is good because they've started bringing the prices down to a more realistic amount.

— Marilyn🦋 (@BeingMarilynK) September 16, 2021

My mom's house sold for way over asking price. Found out Zillow bought it. They really are snatching up all the homes for ridiculous prices. The closing attorney said they do a closing ever hour for Zillow. Just their office alone. That's wild.

— 🦹🏾‍♀️ (@Gladvillain) September 22, 2021

Zillow buying all the homes so none of us can afford to live anywhere should radicalize every single last one of you!!!!!

— Alicia Lutes (@alicialutes) September 23, 2021

This is real. Pressure your Congress people to regulate real estate tech (cough cough ZILLOW) so actual people can buy houses instead of corporations buying them and re-selling at a huge markup https://t.co/ngCDPvND1m

— Carlee 🍂☕️ (@AVainRose) September 18, 2021