A recent Webware column by Rafe Needleman names one of our favorite Web sites, Seattle-based Zillow, among 11 Web 2.0 start-ups "in serious danger of falling off a cliff."

Zillow's the site that gives approximations of your home's value based on sales and market data of nearby and like properties.

Here's what he says:

"The real estate site's revenue model is advertising. Real estate and bank advertising. Unless the real estate site starts charging for foreclosure listings, I don't see it doing too well in a hunkered-down economy in which people are trying to hold on to their homes for dear life, not upgrade."

At Zillow, as you might guess, they disagree.

Here's part of their reply from Zillow director of community relations David Gibbons:

"We actually do have a revenue-generating relationship with the supplier of our foreclosure listings, thanks, You're right that it's one of the opportunities to make lemonade right now. Zillow traffic is actually up 40 percent from last year. We're fortunate to enjoy a very strong brand in a fragmented real estate market."

Gibbons says on-line ad growth is out-stripping traffic growth.

"I won't deny that these are tough times and there's no free lunch in the real estate media industry right now. We've been very frank about the fact that this market delays IPO plans for Zillow. But there are opportunities in every market and many home buyers and owners are more interested in the value of their homes today than ever."