Iggys House, a company that has offered low-cost and no-cost real estate services, is undergoing a "restructuring" that includes the departure of some brokers, the company’s CEO said Monday.
The company’s Web sites, at IggysHouse.com and BuySideInc.com, were not functioning on Monday, and Joseph Fox, CEO for Iggys House, told Inman News that the company "is in the middle of restructuring" and is "expected to be back online in the next week or so."
He said that some brokers "are no longer with us," and that he could not discuss more details about the restructuring at this time.
Fox founded BuySide Realty, a buyer-focused discount company that was the predecessor to Iggys House, with brother Avi. The duo had earlier created online stock brokerage company Web Street Securities and took that company public in 1999 before selling to E-Trade in 2001.
There were plans to take Iggys House public as well, though its initial public offering plans failed to materialize amid a slumping real estate market.
Rumors about the state of Iggys House, which also has offered mortgage services through California-based BuySide Mortgage Corp. and Loan Concepts Inc., have circulated on the Internet amid the company’s non-operational Web sites.
Gavin St. Louis, who formerly served as broker for BuySide Realty Inc. in Round Rock, Texas, said he worked as a broker for Buyside Realty, an Iggys House company that offers a 75 percent commission rebate to buyers, for over six months.
Asked about the company, St. Louis said it is his understanding that "they are closing their doors," adding that he plans to continue to work with former clients of the company, either as an independent real estate broker or with another company.
St. Louis said that he believes the business model for the company is sound. "I think the model definitely works," he said, though he said he believes the company’s IPO plans may not have helped the company.
And Gayle Urick, a San Diego, Calif., broker who left the company on May 2, said she also understood, like St. Louis, that "the company has shut down."
Urick said that she joined BuySide, which launched in April 2006, in its formative stage. She said the efforts to bring the company public may not have served the company well. "Based on the stock market and some of the other things — it may have not been quite the right time for that (IPO plan)," she said.
Also, she said that "brokers, especially there in the beginning, really believed in the BuySide model," and she plans to offer a similar discounted service for buyers on her own through her new company, Serenity Properties.
Iggys House has offered to post properties for free in some multiple listing services, with hopes that consumers would use its other services. The company also had announced that it planned to expand its offerings to include flat-fee real estate brokerage services, referral services and title services.
In financial filings related to its IPO plan, Iggys House reported that consumers had used the company’s free MLS listing services for about 4,000 properties valued at about $1.4 billion, and that the company had closed about 215 buy-side transactions in six states from April 2006 through Oct. 3, 2007.
Also, the company reported that it had a net loss of $9.45 million through June 30, 2007, including a $3.15 million net loss for the first half of 2007. The IPO sought to raise about $14.2 million.
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