Zillow's Business During a Real Estate Meltdown

Rich Barton, CEO of popular real estate site Zillow, passed through town yesterday and met me for coffee at my satellite office, Jamie's General Bean.

Zillow has grown like crazy in the two years since it launched and now gets 5 million visitors a month. It makes its money strictly on advertising. (Still private, it doesn't release financial figures.) So I had to ask: Now that real estate is in a crisis mode, what's that doing to Zillow?

"We're growing 30% year over year," Barton said. He thinks the site is getting even more traffic now that it's a buyer's market. "People take time to research because they have the time -- it's hard to take the time to research when the market is in a buying frenzy and you have multiple bids on a house."

The site also keeps adding features and is "dipping its toe into home improvement" -- perhaps showing people how a certain remodeling project would affect a home's price in a certain neighborhood. When real estate goes sour and people stay put, they tend to remodel what they own. It will soon launch mortgage marketplace on the site.

My guess, too, is that if housing prices are diving, a lot of people want to keep an eye on that. Zillow is a good way to watch what's happening to your home's value -- or the prices of homes in a place you want to live.

Zillow recently picked up another $30 million in financing in the fall. "I raised the last round not because we needed the money, but for a rainy day," Barton said. "A rainy day (in terms of being able to raise money) is kinda here."

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