Tag Archives: HouseValues

Did you sell your SOLD before the bell?

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As you may know, HouseValues (NASDAQ: SOLD) is a publicly traded company. As you may not know, they reported their earnings for the quarter and year ended December 31, 2005, this afternoon.

To quote the highlights from the press release from MSN MoneyCentral

“For the year, HouseValues reported annual revenue and net income growth of 82 percent and 101 percent respectively. For the quarter, HouseValues reported revenue of $25.2 million, an increase of 75 percent from the comparable quarter last year. Fourth quarter 2005 net income was $4.0 million, up 117 percent from the prior year. Fourth quarter 2005 earnings per diluted share were $0.15 compared to $0.08 per diluted share in the fourth quarter of 2004. Net income for the fourth quarter and the year included an increase of $1.2 million as a result of the favorable settlement of a state tax audit.”[photopress:hv_logo.gif,full,alignright]

Blah, blah, Growth Opportunity, blah, blah…

“A recent National Association of Realtors study showed that 77 percent of consumers used the Internet as part of the home search process in 2005. The study also found that buyers who use the Internet to search for a home are more likely to buy through a real estate agent than non-Internet users.* Real estate and mortgage professionals are projected to follow consumer behavior, dedicating more of their marketing spend online than to any other medium by 2009, according to Borrell Associates.”

Blah, blah, Mortgage Opportunity, blah, blah, blah….

“On November 3, 2005, HouseValues announced its acquisition of The Loan Page, Inc. TheLoanPage.com helps consumers find the best deal on all of their home related financing needs by providing them with up to four competitive bids from the nation’s leading lenders.”

So far so good, right? Not according to “Buy on the rumor, sell on the fact” nature of the Street…

To quote another press release from MSN MoneyCentral

“Shares of HouseValues Inc. plunged in aftermarket trading Tuesday, after the company reported a jump in fourth-quarter profit, but said its first quarter and full-year 2006 results would come in well below Wall Street expectations. Shares of the online subscription service for real estate agents and mortgage bankers dropped $3.26, or 25 percent, to $10.14 in after-hours electronic trading, after closing down 25 cents at $13.50 on the Nasdaq.””HouseValues said it expects first quarter 2006 earnings of 3 cents to 4 cents per share, including about 3 cents per share in stock option expenses. Revenue is projected at $25.5 million to $26 million. Analysts were expecting earnings of 14 cents per share, not including stock options, on revenue of $28.8 million.”

What’s your take on this? Does management think an upcoming war with Zillow is going to hurt HouseValues earnings? Is the slowing housing market at fault? Have enough people seen Ardell’s “Bottom feeder post” to cause this market cap hemorrhaging? Can TheLoanPage.com mount a credible threat to LendingTree.com? Can Batman & Robin save us?

Conspiracy theories and comments?

Forget tradition! The New World of Buying and Selling Real Estate

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I’ve been going to the MIT Forum’s dinner topics for years as a technology geek. Now that I’m in real estate, I’m still finding applicable topics. Let me put my plug in for the MIT Forum first — The Northwest Chapter of the MIT Forum hosts monthly dinner meetings with topics relating to business and technology. The topics cover the spectrum from computer technology, biotech, nano technology and yes…now real estate technology trends. Always interesting!!

Topic:

Transformation is afoot. Remember how Expedia revolutionized the travel industry? Now companies in our own backyard, including Redfin, HouseValues and Zillow, are offering online technologies that are transforming the real estate industry. From online valuations and lead generation to completing the legal transaction, these companies aim to exploit opportunities in the business of residential real estate. Home buyers, sellers and real estate agents are changing the way that they do business.

Panelists:

  • David Eraker, Founder, Redfin
  • Spencer Rascoff, CFO, Zillow, Inc.
  • Nikesh Parekh, VP of Corporate Development, HouseValues, Inc.
  • Gordon Stephenson, Co-Owner and Managing Broker, Real Property Associates, Inc., Director, Zillow, Inc

March 15, 5:30PM – Tickets are $50 at the door (less if you buy ahead of time). Visit http://www.mitwa.org for further details.

The 5:30 time is no-host cocktail with doors for dinner opening later. Come on by and join us.

RCG may have completed the real estate blogging trifecta, but which horse is going to win?

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About a week ago I noted that the Zillow Blog added Rain City Guide to its sidepanel and that I hadn’t found out about both the Redfin Blog or the HouseValues blog because they hadn’t spread any link love. As Rain City Guide hasn’t done much to deserve traffic from either site, I didn’t really expect my comments to make much impact, so I was pleasantly surprised to find that both blogs added Rain City Guide to their sidepanel in less than a few days, thus completing my Seattle-real-estate-search trifecta!

I start with this story because it highlights two timely points I want to make: (1) all real estate is local and (2) business blogs can be shockingly responsive in ways that simply is not possible with a standard business website.

And just as all real estate is local, I’m happy to say that all interesting real estate search technology appears to be local as well. I’ve seen some fun tools come out of New York and California (or should we say CaliYork), but I don’t think it can be argued that the future of real estate is being developed right here in Seattle.

So who is going to win the real estate technology race? Will it be:

I don’t pretend to have the answer, but I sure enjoying keeping score. 😉

The second (and only tangentially related) point I want to make is that business blogs are now the norm for tech companies. When done right these blogs are much more than just a place to put press releases and instead give some great insight into the corporate personality behind the company. Go ahead and read the first few blog entries from each of the big three real estate search sites:

(I’m waiting…)

Here’s is what I read… The Zillow people are a zany, tech bunch who really believe that they can crack the real estate nut through increased data crunching and processing power. The Redfin people have figured out a better business model and now only need to expand so that they can demonstrate efficiencies of scale. The HouseValues people have a laser-like focus on present marketing opportunities, so they really don’t spend much time thinking about the future. Had any of these three companies been blogging a year ago, I’m sure their blogs would read the same! And more interestingly, I’m fairly confident that if I read the “latest” three or four entries from those same three blogs one year from now, those will also read the same because the culture that created those blogs is the same culture that created those companies. There is a real honesty in blogging that is hard to mask. Both a company’s strengths and weaknesses show through in their blogs!

However not everyone sees blogging from this vantage point. Recently, Daniel Gross of Slate signaled the beginning of the end of the business blog, by focusing on all the problems with blogging. But by focusing on the financial aspects of blogging (which often don’t make sense), he misses out on the overwhelmingly positive marketing opportunities associated with adding a friendly face to an otherwise impersonal website. I’m so glad that these three big real estate tech companies out of the Seattle area have all begun blogging because it gives some great insight into the soul behind the companies.

The Future of MLS search is coming to Rain City Guide

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22

Greetings fellow Rain City Readers! I’m a software engineer that has been working with Dustin to develop a better MLS search. Before I get started into what I’m doing, I thought I’d discuss the why I’m doing it…

My saga began when I had the opportunity to develop an NWMLS search web site for a local realtor. After spending several weeks, cutting red tape, determining what forms I needed to fill out, figuring out whom at my realtor’s broker I needed to bother, signing my life away and finally getting access to an NWMLS database, I was at the point where I could get real work done. Anyway, after I had spent over 40 hours developing standard search features (search summary with thumbnails, property detail page) and a few interesting ones (like customized HTML e-mail with property photos, customizable photo not available photos on search results), I sent her my bill.

Then things went south. Despite the fact that my client was warned ahead of time that my time isn’t free, she apparently expected that I would be price competitive with “canned” solutions such as those offered by iHouse & Superlative. On the one hand, I can’t blame her. A consultant can’t compete with a commercial product, because a commercial product has a lot more customers to help finance its development than a lone consultant does. Just because those companies sell solutions for $50/month doesn’t mean it only costs them $50 to design, develop & test the software! It still costs those organizations thousands of dollars (or more) to bring these products to market! However, if you plan on distributing software to 1,000 customers, you can charge a lot less per customer, than if you are only distributing it to one.

Anyway, after this failed business opportunity, I decided to contact Dustin and regroup. I wanted to develop a unique MLS service that would’ve given my client a competitive advantage (and she was more interested in price than value) and after reading Rain City Guide it became obvious that Dustin would see the value in what I could do. Besides, I’d rather continue to improve the code I was working on than send it to the hard drive in the sky.

Dustin & I, both share the belief that the real estate industry is in for some very interesting times as the reverberations of the internet revolution continue to change our society and business models. Dustin’s enthusiasm for the ideas I’m trying implement is contagious and we essentially worked out a deal in which I’ll continue to develop compelling MLS technology in my spare time, I’ll use him and his Rain City readers as a sounding board for ideas and beta testers (both marketing & development feedback), and in a few months time, ideally, I would have developed a really unique service that technology savvy realtors would be willing to pay for.

One of the cooler things I’ve done is turn MLS search results in to Google Earth files. Just download the Google Earth application, visit our BETA listings search page, click on the Google Earth icon, and see your search results on a 3D globe. Eventually, we’ll do similar stuff with AJAX style Mapping (although, right now I’m focusing more on things that haven’t been done yet) and other applications.

Google Earth Application

Most realtors have “me too” & “same old thing” web sites. One of the things I want to do, is give realtors the ability of exploiting the MLS data in way that is valuable and compelling to their clients and strengthens & reinforces their name/brand to their prospects. Having customized RSS feeds of MLS data, having proximity searches to points of interest (how far is this house away from a gas station?), and take advantage of all the cool location/mapping technology that the 3 giants of the internet are developing (Microsoft, Google & Yahoo), are just some of the things that could be done, but aren’t really done yet.

One of the reasons for this state of affairs is that currently only software engineers with access to MLS data can do these things. Unfortunately, we live in world in which most realtors don’t have the skills & knowledge that software engineers have and most software engineers don’t have free access to the raw MLS data that most realtors do, so things are moving slower than they otherwise might be. Obviously, waiting for the HouseValue’s of the world to develop this technology is an option. However, their business model seems to be marginalizing the value of a realtor instead of enhancing it. I’d rather take the opposite tack, since I suspect that my future customers would prefer to use technology to improve their competitive advantage against all comers rather than having it used against them and risk turning themselves into a bunch of “me-too” commodity realtors paying somebody else for random sales leads. (which is probably one of the reasons you blog!)

Right now, you can take a gander at the humble beginnings of our grand vision at http://listings.raincityguide.com/search.aspx. Granted we still have a few bugs that need to be fixed, and many, many more features need to get implemented. However, it’s my goal to turn this into something that would provide a compelling value for my future clients (realtors & their customers) and I welcome any comments that would help me, help you.

Robbie
Caffeinated Software