To me, a plethora of “Zillow owned homes” in an area is a negative signal for pricing outlook. Zillow is a non-user of these properties and therefore represent future selling pressure in the neighborhood.

I think they’re welcome as a market participant and, if they’re particularly good at pricing properties, they might be able to make some money by exploiting inefficiencies in the market.

I think it’s far more likely that they’ll be a net donor to most markets from their algorithmic operations (in trading terms, I doubt they’ll exhibit positive alpha from purely algorithmic buying).