Realtor.com operator Move Inc. today reported a third-quarter net loss applicable to common stockholders of $4.6 million, or 3 cents a share, citing impact from the housing downturn.
The third-quarter loss compares with a $980,000 profit Move reported during the same quarter in 2006.
The company reported $75.6 million in total revenue for the third quarter, nearly unchanged from the $75.7 million recorded during the same period a year ago.
Move Inc. CEO Mike Long in an investor conference call Thursday afternoon called current housing market conditions the “toughest residential real estate market in 15 years,” and said the industry has not had time to rationally adjust to the declining market.
“I do not see a quick turnaround of housing in the next few quarters,” he said, adding that he expects a gradual recovery.
The sales rate for previously owned single-family homes dropped to its lowest level in about 10 years, and the price of resale single-family homes, condos and co-ops dropped 4.2 percent year-over-year in September, according to the National Association of Realtors’ latest report.
Move Inc. makes money by charging real estate companies and agents for added services and marketing features on its property listings Web sites. In addition to Realtor.com and Move.com, the company operates listings search sites for new homes and apartment rentals.
The real estate industry has been slow to adopt online marketing and advertising compared with other industries. Long today said that Move executives expect the current market downturn will serve as a catalyst that will materially increase the amount of online ad spend from real estate marketers.
Move isn’t the only company banking on the assumption that more real estate advertising dollars will move from print publications to the Internet in coming years. Seattle-based Zillow, which launched in 2006 and has raised $87 million in funding, is also vying for online real estate ad dollars.
A study released this week indicates that spending on print advertising continues to rank high among real estate practitioners, though a growing number reported that they advertise at national Web sites. (See Inman News story.)
Move’s Long said Thursday that the number of real estate companies that are buying enhanced listings services from Realtor.com has tripled in the last year. He also noted the size of unsold listings inventory has grown in that time as property sales have slowed.
“Though the shift from offline to online advertising in real estate is taking longer than anyone could’ve anticipated, it is inevitable,” Long said.
Move President Lorna Borenstein highlighted a few changes made at Move during the third quarter, including that property listings on Realtor.com can now be indexed by search-engine crawlers.
Borenstein also said company executives are not satisfied with Move’s current rentals listings business and is actively exploring other business models for this segment.
Move’s stock (Nasdaq: MOVE) closed at $2.38 per share on Thursday, down 6 percent from the previous day’s closing price of $2.54.