Group Zilo Has reached a sale agreement of about 2,000 homes from its unfortunate “flipping” program, the company’s first significant sale, as it begins to get rid of thousands of homes and liquidate the program.

Perthium Partners, a New York-based investment firm, has agreed to purchase Zilo’s homes across 20 markets in the United States and plans to rent them out, according to sources involved in the details.

The digital real estate company said it plans to sell about 9,800 homes it owns, in addition to another 8,200 homes that are in the process of being purchased. The company expects to lose between 5% and 7% in these sales. According to the same factors.

Zillo’s flipping program included buying homes, renovating them and then selling them quickly – with a monetary profit from the sales commissions and hundreds of home prices. The company, along with other online real estate agencies, used an algorithm that would perform an estimate of home prices and determine the payment to sellers.

Last week, Zilo said she was shutting down the business because she could not accurately predict house prices and lost too much money. The company expects to record losses of more than $ 500 million from the “flipping” program by the end of this year, and will lay off a quarter of its employees.

The sale to Partium spurred Zillo’s disengagement from the online real estate business.

Partium, which owns about 70,000 family homes, intends to own homes and manage them as tenants. The business has been a success for the company as well as for other investors focusing on long-term home rentals near busy metro stations, where families often feel the purchase price is beyond their means. The accelerated joining of new households, which was curbed during the Corona plague, also accelerated the demand for rental housing.

“We will continue to invest in communities and improve access to housing throughout the United States,” a spokesman for Perthium said.

As of July, rents for family homes had risen 8.5% year-on-year, according to CoreLogic, which provides housing data, the highest increase in 16 years.

Other rental property investors, such as Invitation Homes Inc and American Homes 4 Rent for example, are considering bids on some of Zulu’s remaining property inventory, according to numbers involved.

In addition to the homes that Zulu left at the end of the third quarter of the year, the company said it has another 8,200 properties that are in the process of being purchased and that they will also have to sell. Zilo said that a complete shutdown of its “flipping” business is expected to take several months.

Three Democratic senators, including Banking Committee chairman Shrod Brown of Ohio, have raised concerns about real estate investors limiting the number of homes available to regular buyers. In a letter Monday from Zilo CEO Rich Burton, the senator asked about the company’s plans to sell the homes to investors, including Perthium, about which he noted there was a “worrying record,” such as reports of a dilapidated condition of homes and complaints from tenants about payment methods.

A spokesman for Partium said in this regard: “For households across the country seeking to rent homes, Partium provides a high level of housing experience, through reliable, consistent and attentive service for our well-maintained and offered homeowners at affordable prices.”

By Editor

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