Shares of Zillow Group (NASDAQ:Z) (NASDAQ:ZG) declined by 12% in October, according to data from S&P Global Market Intelligence. The online real estate portal's fall from $102 per share to $89 per share during the month came on the heels of the stock's 19% surge in September.

Zillow Group shares were up 95% year to date through the end of October, which constitutes a massive rebound from their low point in mid-March, when they were down by 49% for 2020.

What happened

Last month was a fairly slow news period for Zillow. The biggest reveal was that it appointed Claire Cormier Thielke to its board of directors. According to the press release,

Thielke currently serves as managing director of Hines, a leading global real estate investment, development and management firm, and is responsible for acquisitions, development and new business generation in the Asia Pacific region. Previously, Thielke served as chief operating officer of investment management for Hines. She is a member of Stanford University's adjunct faculty, lecturing on the intersection of technology, institutional investment and real estate assets.

As far as macroeconomic conditions go, benchmark interest rates ticked marginally higher during October. According to the Federal Reserve Bank of St. Louis, the 10-year Treasury constant maturity rate began the month at 0.69% and ended the month at 0.88%. That may partially explain Zillow's share price slide during October. Competitor Redfin (NASDAQ:RDFN) lost 16% of its value as well, which suggests the cause could be related to the macroeconomic situation.

A couple looks at a real estate app on their tablet.

Image source: Getty Images.

So what

The appointment of a new board member is almost never a reason for a stock to sell off, and this case is no exception. Thielke seems like an eminently qualified individual who is likely to provide valuable contributions to the company as it navigates what Zillow co-founder and CEO Rich Barton calls "Zillow 2.0." 

As for the higher interest rates, generally speaking, those do have a dampening effect on real estate activity because they make mortgages less affordable. In addition, they tend to have a dampening effect on all asset prices, including stocks.

Now what

Overall, interest rates are still extremely low in historical context. And one month of interest rate movements is probably not worth focusing too much on.

Instead, investors should focus on the growth of Zillow's Premier Agent business and its long-term efforts to transform the real estate transaction with its Zillow Offers business.  

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.