The residential real estate market is cold to the touch, but don't go telling ZipRealty (NASDAQ:ZIPR). The realtor with a cyberspace bent saw revenue climb 22% to $23.4 million for the quarter ended in March. The growth spurt didn't come cheap, with the company's loss widening to $0.14 a share from $0.04 for the period. Backing out stock-based compensation and non-cash income taxes, the loss clocked in at $0.10 a share (a penny off last year's showing).

ZipRealty's performance was good enough by Wall Street standards. Analysts were looking for a $0.15 per-share deficit on only a 14% top-line boost. It's easy to see why the pros were aiming so low. Even as ZipRealty expands into new territories, it's like a salmon trying to go upstream. The flow is working against it. Don't even get me started on the dangers of salmon-chomping bears. ZipRealty's top line inched just 7% higher during the December quarter.

So this year's first quarter may feel like a breakthrough. ZipRealty wound up closing 18% more realty transactions, generating an average of 3% more on each one.

The company isn't letting it go to its head. Instead of raising guidance, it's sticking to its original 2007 outlook. ZipRealty expects to post a loss of $0.45 a share to $0.60 a share, on $105 million to $110 million in revenue. The red ink isn't pretty, but all four analysts following the company expect it to be soundly profitable next year. That is important because the company's debt-free balance sheet is loaded with $3.89 a share in cash. The stock is attractively priced at less than twice its greenery.

ZipRealty is a disruptor in the residential real estate market. It charges as little as 4.5% to 5% of a home's selling price in commissions, below the industry standard of 6%. It then treats eventual buyers to a 20% slice of the commission that it is set to receive. It has also ruffled feathers by allowing potential buyers to post reviews on individual listing pages.

The Internet can be a real estate enabler. You see it in parent Move (NASDAQ:MOVE) as well as IAC's (NASDAQ:IACI) and lead generator HouseValues (NASDAQ:SOLD). On the healthier commercial real estate front, LoopNet (NASDAQ:LOOP) is thriving as a Web-based marketplace.

So give ZipRealty a little credit here. It is growing in a sliding sector, improving its position with every passing quarter as it waits for the residential market to regain its winning ways.

HouseValues is a Motley Fool Hidden Gems stock pick. LoopNet is a Rule Breakers recommendation. Want to check either newsletter out? A free 30-day trial subscription will set you up with the open house that you crave.

Longtime Fool contributor Rick Munarriz is not looking to move anytime soon, but he does enjoy browsing through real estate sites to see what's out there. He does not own shares in any of the companies in this story. He is part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.