[rahimnathwani]

"Personally I feel that this only makes housing more unaffordable in the long run for most people"

In the long run, housing prices are determined by supply and demand. Supply (housing stock) is increased when prices are high (as developers can make money). And supply stays flat when prices are low (but developers don't destroy the existing homes).

If this short term trading by Zillow etc. is causing market prices to be high at the moment, you'd expect that to increase long term supply. So future prices would be lower than they would be without Zillow.