Zillow shifts to Preferred Agent model, boosting monetization despite revenue deferral.

Zillow has changed its For Sale business to a Preferred Agent model, where agents pay Zillow only after a successful transaction closes. This shift causes expected revenue to slow this year as income is deferred to home sales rather than upfront fees. However, the new model increases monetization per connection by over 30%, making each lead more valuable. Zillow's stock trades at an attractive valuation of about 10 times adjusted EBITDA, partly because the market is still adjusting to this new revenue approach.