Despite Seattle’s resilience so far, the deflating bubble elsewhere around the country continues to affect businesses based in the Seattle area. The latest victim—HouseValues—took a hit last week.
Last year’s booming housing market helped pump up 2005 profits at Kirkland-based HouseValues, but the company’s forecast for the current year led to a 28 percent stock-market pummeling Wednesday.HouseValues said Tuesday, after the markets had closed, that slower growth in its business from real-estate agents and heavy investment in new businesses would keep its 2006 results well below Wall Street’s expectations.
Wall Street was quick to respond. HouseValues shares, already trading 33 percent below their July 2005 peak, dropped $3.79, or 28.1 percent, on Wednesday, closing at $9.71. That’s the stock’s lowest close since HouseValues went public in December 2004.
This could be our area’s first of many negative effects of the impending drop, or it could be all we see of the downturn. Since I seem to have misplaced my time machine, I’m not able to make that call. Of course that doesn’t mean I can’t wildly speculate anyway. My call? Well let’s just say that I’m glad I didn’t buy a house in the last year or two.
(Drew DeSilver, Seattle Times, 03.02.2006)
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I don’t think the housing market has anything to do with the drop. I would blame their business model.
HV did well for a while because it was a new marketing tool for realtors to try out, but they are not retaining very many subscriptions probably because it is not effective.Have you been to the site? The site consists of you giving them your information (i.e. you sign up for SPAM) and then realtors will call, email and mail you telling what your house is worth. As well as how wonderful they are.
HV’s other problem? Zillow.
Would you rather type in your address and get the value of your home (and your neighbors’, friends’ and enemies’ homes) for free instantly, or sign up to get SPAMed within three days for eternity by realtors?
I’m enjoying your blog, by the way.
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Housevalues is a scam. I know my husband worked there. Oh well, the founder owns several brand new Porches’. Greedy pigs.
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HouseValues is definitely regarded by savvy real estate agents as one BIG SCAM. They prey on brand new real estate agents, trick them into electronically signing a contract for one year to the tune of between $300-800 a month and send them shoddy leads that don’t work. Agents are catching on though – the stock which went from about $24 to about $7. It will be worth a few chuckles when they become penny stock. This change in my opinion is not just because of the housing industry. Much of the reason is that realtors are sharing information and getting the word out. What’s the word? HouseValues=SCAM
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I’m a Realtor. I have already paid HouseValues $3,800 for no results. What’s worse is that they have sent me to collections for another $2,500.
My feeling is that this company has some really bad business practices. ripoffreport.com has quite a bit of information about them. So does Realty Chat.
I have filed complaints with NAR, CAR, Washington State Attorney General, and the BBB. Call me a crybaby, but they did not deliver what they promised.
When I complained about the quality of the leads, they turned it around and it was always about what I was doing wrong.
The people at housevalues even went so far as to put down Realtors in general.
After talking with other Realtors, the song and dance I got was very similar to thiers.
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And now Housevalues’ CFO is working for Linden Research. AKA: Second Life, a virtual world where land marketing is all the rage. I guess if you can’t make your career in the real estate field legitimately, you can now turn to a game where there are no real consequences to scamming.
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