Overseas, iBuying is disrupting traditional real estate models, through “house-flipping” enabled by tech platforms.

However, recently American iBuyer Zillow announced its closure after racking up over $1 billion in losses over 3.5 years - a move that has significant implications for the real estate industry over there.

Zillow's iBuyer business grew so fast that it literally broke the company, forcing an abrupt shut down. In Q3 - the three months that broke the business - Zillow purchased more houses than in the previous 18 months combined - which is the type of growth that can stress a business to breaking point.

Zilow said it “unintentionally” purchased homes at higher prices, while competitors did not. Despite huge competitive advantage, its margins were consistently lower than its peers. Why? The others are just better at iBuying. While its peers managed incremental operational improvements over time, Zillow did not.

For years, investment in real estate tech has frequently defied reason, prioritizing a company's ability to grow over profitability, but perhaps this is a turning point.

I, for one, welcome the reintroduction of rational investment thought back into real estate. Let this be a welcome wake-up call for investors and the industry and a lesson for countries like New Zealand, who look to overseas trends for future predictions about the directions their own markets may head in.

Mike DelPrete is a Global Real Estate Tech Strategist and an Independent Director of Tall Poppy Real Estate.