Across the U.S., real estate markets are on fire. It’s a segment of the economy that is setting its own pace. This “seller’s market” is the culmination of low inventory, new relocation patterns, low interest rates and reduced new builds hindered by material scarcity. Whether your metro area is at full flame or beginning to simmer, you’re likely wondering how to best approach real estate and mortgage advertisers.
The messaging must be relevant and help them stand out, whether they are agents seeking listings or mortgage brokers trying to land new buyers. In this post, we’ll cover the current data ecosystem and include some creative ideas to pitch to your advertisers in these fields.
Diving into Data:
What the Markets Look Like Right Now
According to the National Association of REALTORS® (NAR), these are the May 2021 numbers for existing home sales:
- Home sales fell for the fourth consecutive month, likely due to a lack of inventory. In May 2021, there was a 2.5-month supply (meaning there are approximately enough houses on the market for this time period). That’s down from 4.6 months in May 2020.
- The median sales price was $350,300, up 23.6% year-over-year.
Housing Shortages Based on Permits
NAR also tracks shortages of housing based on the issuance of new permits for builds. You can look at the changing map here. Some areas of high shortage include the California coast, Champaign-Urbana, IL, Pittsburg, PA, Miami, FL, the greater New York City-Newark area, Boulder, CO, and Boston, MA.
Some fast-moving markets are picking up the pace on construction with an uptick in permits. The question is, how fast can they build the housing?
It depends on when construction companies sourced the material. The National Association of Home Builders (NAHB) released a survey identifying a record number of builders reporting material shortages. Those most in demand include lumber, windows and doors, copper wiring and vinyl siding.
As of mid-June, interest rates are incredibly low; with NerdWallet’s assessment, a 30-year fixed-rate mortgage has an average APR of 2.926%. That is 76 basis points lower than one year prior. These low rates aren’t just favorable for new, qualified buyers. They’re also promising for anyone that wants to refinance or take out a home equity line of credit.
From Data to Actions
Above, we’ve shared the trends and data on markets across the country. You’ll want to localize your data set. Both the NAR and NAHB are great resources. Keep in mind that your advertisers should be well aware of local trends, so adding any statistics is more to assure them you’re up to date on the market, as well. These data points can also be part of your ads if relevant to consumers (think rates, median sales price, etc.).
The other data you should include in your proposals is information about previous ad campaigns these groups of advertisers ran, with results and insights.
Next, it’s putting together your data, third-party data and opportunities. Here are some potential ideas that could help you tap into these trends and support your advertisers.
5 Ideas for Real Estate and Mortgage Advertisers
What kind of messaging and ads will resonate with consumers? Here are some ideas.
- Focus on refinancing: Millions of Americans have equity in their homes due to the rise in their property value. They likely could benefit from a reduced interest rate, which could decrease their monthly payment. Play on the theme of cutting mortgages for well-qualified buyers. You’ll want to use real-time data points about current rates. Mortgage companies could use targeted channels like email marketing and SMS campaigns to existing customers. In addition, they could expand their reach with geofencing for those in specific ZIP codes via display, radio and TV ads.
- Seek out alternative real estate agents: Multiple franchise real estate companies are disrupting the market because they take smaller commission fees (i.e., Realty One Group and Homie). Both are relatively new and need some brand awareness to spread their message of paying fewer fees. They could benefit from branded ads on radio and TV as well as targeted over-the-top (OTT) and connected TV (CTV) video campaigns, which is a hot channel right now due to the high consumption of streaming.
- Develop more “get the listing” campaigns for agents: Securing listings is key for real estate agents right now since it’s a seller’s market. It’s highly competitive in almost every metro area, so these advertisers need to stand out and reiterate their experience and what makes them unique, such as their marketing plans to sell homes. These would be highly visual ad units that include agent pictures and previously sold homes. Recommendations could consist of OTT, social media marketing and display ads on third-party sites that consumers would frequent.
- Lead with agent and broker expertise: With the market so challenging and consumers hungry for guidance, you can pitch this approach to your advertisers. For agents, create branded ads that offer tips for buyers and sellers. For mortgage entities, promote information on getting approved, working on credit scores and multiple options for financing. These little narratives and teasers could work on radio, TV and display ads.
- Position comps to possible sellers: If a neighborhood’s comps are rapidly rising, this could be an extra incentive for those on the fence about selling. Homeowners that already have a good equity ratio on their mortgage could stand to make a windfall if they sell. Talk to agents about geotargeting specific neighborhoods where this is happening. If they sold houses in these communities, all the better. Place these ads on radio, OTT, display and social channels.
Seize New Opportunities in the Housing Market
The real estate market won’t be infinitely increasing. There are too many unknowns right now concerning the greater economy and the end of the pandemic. However, that doesn’t mean real estate and mortgage clients should do nothing. They need to seize opportunities with your help.