Zillow’s stock rallies as housing market outlook appears strong

Shares of Zillow Group Inc. (NASDAQ: Z, ZG) were up 16% in afternoon trade on Thursday amid strong fourth quarter revenue growth and a positive outlook for the housing market. The stock has gained 34% in the past one month.

The online real estate company has benefited from strong consumer demand and high partner retention rates. Looking ahead, Zillow expects to drive growth by addressing the strong demand seen in existing markets rather than moving into new ones.

Zillow Offers continues to expand into new markets and was recently rolled out in Los Angeles, the second largest housing market in the US. Zillow Offers is currently operational in 23 markets nationally and the company plans to expand this to 26 markets by mid-year.

Zillow is seeing momentum in its Premier Agent business and expects revenue growth to accelerate in the first quarter of 2020. Revenues in Premier Agent are expected to increase 10% year-over-year in Q1 2020.

The US housing market, in general, was stronger than expected in the last quarter of 2019 and total transaction values increased due to high buyer demand and low mortgage rates. New home sales are off to a strong start in 2020.

Experts believe the housing market will see positive trends in 2020 as mortgage rates remain low and construction continues at a healthy pace. Companies like Zillow are expected to see an increase in their business this year due to the flexibility and convenience they offer to home buyers.

Follow our Google News edition to get the latest stock market, earnings and financial news at your fingertips.