The economy may be recovering, but there is still a long way to go before the housing sector returns to its pre-recession boom. As the April deadline for the home owner tax credit expired, sellers have responded by reducing their house prices. U.S home prices are estimated to have dropped by $25 billion from March to April – a phenomenal 10% decline, according to real estate reports. The reduction continued in the month of May when 43% of sellers reduced their prices compared with 41% in April.
The reduced prices helped drive up revenues for online Realtors. ZipRealty’s (NASDAQ:ZIPR) reported that Q1 revenues grew 19% over the year to $25.8 million. The company closed $1.1 billion in real estate transactions compared with $0.91 billion a year ago. The number of transactions closed also grew, to 4,903 compared with 4,171 a year ago, translating to a 1% decline in net transaction revenue per close to $5,067. In April, ZipRealty closed its 100,000th real estate transaction. For the quarter, the company reported a net loss of $0.31 per share compared with a loss of $0.38 per share recorded a year ago.
ZipRealty has been expanding its presence into the handheld device space. It already has applications for both the iPhone and Android cellphones and also recently released an application for the iPad. The iPhone application has already been downloaded more than 125,000 times, and the company expects a similar performance for its Android and iPad applications. The market is already giving positive reviews for the Android application.
The stock is trading at $3.16 with a market capitalization of $64.8 million. It reached a 52-week high of $5.47 in March of this year.
Meanwhile, Move (NASDAQ:MOVE) continued to report sluggish revenues. For Q1, revenues fell from the previous year’s $54.9 million to $48.6 million. Earnings, however, registered minor growth from 11% a year ago to 12% in the latest reported quarter.
Move is continuing to focus on improving its platform and user experience. The company is working on releasing a new version of its new Realtor.com platform, which will leverage its real estate data and relationships with real estate professionals and consumers to provide a more “valuable online real estate experience for consumers and real estate professionals.”
The company recently announced a tie-up with Lat49 to enable improved targeting of their properties. Lat49 is a location-focused advertising platform that is able to incorporate ads on online maps and other location-related Web properties as well as mobile applications. The hyper-local advertising solution will now be available on the Move Network and will enable improved listing based on the website visitor’s physical location or expressed location of interest based on map views or other home search criteria.
Move is also growing within the handheld device market. Its iPhone application recorded over one million downloads within five months of release.
MOVE expects revenues for Q2 to be $48.5 million–$49.5 million with EBITDA between 10% and 11%. For the fiscal year, the company expects revenues of $191 million–$195 million with EBITDA of approximately 10%–11%.
The stock is trading at $2.30 with a market capitalization of $358.66 million. It touched a 52-week high of $3.18 in September of last year.