How do owned by zillow homes make money?

[John Collins]

I've noticed zillow buying up a few homes in the mid range category, which is around 200-350k in the midwest. They seem to immediately put them on the market for a few thousand more after a month. (Say buying a house for 335, selling fo 342 a month later). It's never a big enough margin to justify the effort.. How on earth is this profitable? To top it off, the price drops immediately after 3 weeks if it didn't sell.