After 34 years of service, mounting debt and a sudden illness plummeted Berkeley’s longest running rental referral service into bankruptcy.
“I just can’t borrow any more money,” said Homefinders President Dana Goodell, who took over the business five years ago from her father and uncle.
Goodell said the last straw came in October when appendicitis kept her out of work for a month.
“I thought, I’m just killing myself doing this,” she said. “I can’t do it anymore.”
Word of Homefinders’ demise began spreading last weekend when its website disappeared and clients complained that their telephone calls had gone unanswered. Over the past four years the company reduced its workforce from 30 employees to three and earlier this year moved into a less expensive office space on Shattuck Square.
Clients might have to wait a while for a subscription refund. Goodell said she is in the process of filing for bankruptcy and that the court would decide which creditors—bankers or clients—Homefinders would have repay first.
Meanwhile, MetroRent, a San Francisco-based rental referral service with East Bay listings, has offered to honor the subscriptions of Homefinders customers.
“We didn’t think it would be good for the rental referral business to leave the customers in a lurch,” said John McWeen, a MetroRent principal.
Goodell said that she has sent e-mails to Homefinders customers and has already given full $60 refunds to those who signed up in the past week, several of whom, she added, had already found homes.
Goodell blamed her company’s collapse on the rise of craigslist as a free alternative to rental referrals and the soft rental market that turned record profits in the late 1990s into unsustainable losses since 2001.
“I don’t think it’s a viable business model anymore,” Goodell said. “Now that there are more resources, you can’t be just a rental listing service.”
Berkeley is now down to one such service, eHousing, which Goodell said has done a better job at reducing overhead.
Although technology has offered tenants and landlords new avenues to do business, Berkeley property owner Darleen Dhillon, who arrived at Homefinders office Wednesday to try to find out why her calls weren’t being answered, said the service was still essential.
“Not everyone is going to go to craigslist,” Dhillon said. “Homefinders found me my best tenant.”