The Seattle Times published a story about Kirkland-based HouseValues’ stock plunging last week, one day after the Kirkland company forecasted 2006 financial results that were far below Wall Street expectations.

Shares of the online real-estate services company sank $3.79, or 28.1 percent, closing at $9.71 on trading volume almost 10 times the recent daily average.

John Cook of the Seattle PI, in his Venture Blog, asks if it’s because of new competitor of online house valuations, Zillow.

Robbie Paplin at Rain City Guide asked some good questions and provides a link to this great website, The Rip-Off Report. Robbie asks : “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?”

I think the answer may lie in their business model, how they currently generate income, and the possibilities for continuing to do this in the future.

House Values Stock Tumbles continued here……