Zillow deal has 'significant synergy potential'

More sustainable housing recovery: Rascoff
More sustainable housing recovery: Rascoff   

The two most popular real estate search sites are now under one roof since Zillow closed the Trulia acquisition deal after closing bell on Tuesday. Zillow shares surged more than 10 percent on Wednesday mostly on the news of cost-cutting.

Zillow CEO Spencer Rascoff told CNBC's "Squawk Alley" on Wednesday that "we are well positioned as the $13 billion of real estate advertising migrates on to the Internet."

"The synergy potential here is significant," he added. "There will be significant cost savings as a result of that."

He said that so far the two companies represent only 5 percent of the "tens of billions of dollars in real-estate related advertising."

Spencer Rascoff, CEO of Zillow.
Adam Jeffery | CNBC
Spencer Rascoff, CEO of Zillow.

Rascoff spoke about the macro trend of real estate agent advertising that is becoming increasingly concentrated on mobile and the web because "that's where the consumer is."

On the health of the overall housing industry, he said home values may be slowing, "but that's OK and actually makes for a more sustainable recovery."

It took seven months for the merger to seek government approval, and Rascoff described it as "a long and arduous and stressful process."

He is also a co-author of the newly published Zillow Talk: The New Rules of Real Estate.