2012 Real Estate Advertising Outlook: The Long Road Home

  • August 2012
  • -
  • Borrell Associates Inc.
  • -
  • 33 pages

This 33-page report details changes in home buying, homebuilding, construction permits, home-seeking habits and advertising expenditures. It’s our annual assessment of one of the largest advertising segments of all – and the highest category in online advertising (Real Estate is at $13 billion, and Automotive is No. 2 in online advertising expenditures, at $12 billion). The report includes 24 charts and tables that display historic growth patterns in construction and home sales, as well as trending for advertising expenditures. One full chapter analyzes the online phenomenon, including discussion about the Top 25 realty sites and how they’ve been trending. It includes a 10-page appendix of detailed data for each of the business subcategories: mortgage providers, developers, agents and brokers, and rental managers.

EXECUTIVE SUMMARY

Home sales and new construction are enjoying a slight but noticeable rebound, but media aren’t enjoying the same rebirth. New and existing home sales are expected to be up 5 percent this year, and construction permits for new housing once again outnumber starts. Meanwhile, advertising expenditures are down for the third consecutive year. We’re forecasting that advertising in this category will be down 16.4 percent from 2011. Online media continue to grow their domination of the real estate space. We’re forecasting it to grow 15.2 percent this year, hitting $13 billion. It currently accounts for 55 percent of all real estate ad budgets, while newspapers have dwindled to 14 percent, the second-highest share.
Only one other business category – job recruiting – spends a greater percentage of its advertising budget on online media. There is a great deal of jockeying within the online space. What were once thought to be category killers – sites such as Realtor.com, AOL Real Estate and Yahoo! Real Estate – have all seen traffic declines in the past 12 months while nimble upstarts like Zillow, Trulia and Homes.com have elbowed into a Top 5 position. Looking ahead, a new period of disruption faces this category. It’s one where display advertising and paying for listings are on the wane, and a whole set of sophisticated tools – including social media – are ripe for development.

Table Of Contents


Table of Contents

EXECUTIVE SUMMARY.. 4

CHAPTER I .. 5

Fig.1.1: Households Planning to Buy a New Home during the Coming Year - 2006 through 2013, in Millions of Units . 5
Fig.1.2: U.S. Housing Starts vs. Residential Permits - 2006 through 2012, in Thousands of Units . 6
Fig.1.3: U.S. States by Percentage of Distressed Mortgages*. 6
Fig.1.4: U.S. Average - Time Needed to Complete a Real Estate “Short Sale,” in Days . 7
Fig.1.5: States with Highest Negative Equity/Distressed Mortgages 8

CHAPTER II

The Commercial Side . 9
Fig.2.1: U.S. Commercial Mortgages, by Category 9
Fig.2.2: Notices of Default on Commercial Mortgages - October, 2011 through March, 2012 . 9
Fig.2.3: U.S. Bank Failures - 2000 through June, 2012 ..10

CHAPTER III

Real Estate Ad Spending .11
Fig.3.1: “Which of the following sources best provides you with new business? .11
Fig.3.2a: Real Estate Ad Spending by Source, 2011-2012, in $ Billions 12
Fig.3.2b: Real Estate Ad Spending by Medium, 2010-2012, in $ Billions 12
Fig.3.3: Ad Spending by Agents and Brokers, 2010 - 2012, in $ Billions 13
Fig.3.4: Ad Spending by Rental Property Management, 2010 - 2012, in $ Billions .14
Fig.3.5: Ad Spending by Mortgage Providers, 2010 - 2012, in $ Billions 15
Fig.3.6: Ad Spending by Developers, 2010 - 2012, in $ Billions 16

CHAPTER IV

Real Estate Online Advertising: Dramatic Increases.17
Fig.4.1: U.S. Real Estate-related Ad Spending - 2009 through 2017 (F) in $ Millions Online vs. Newspapers Ad Spending .17
Fig.4.2: Real Estate-related Online Ad Spending Forecast - 2012 through 2017, in $ Millions ..18
Fig.4.3: Agent and Broker U.S. Online Ad Spending - 2012 (P) vs. 2017 (F), In $ Millions .18
Fig.4.4: Rental Property Management Online Ad Spending - 2012 (P) vs. 2017 (F), In $ Millions 19
Fig.4.5: Mortgage Provider U.S. Online Ad Spending - 2012 (P) vs. 2017 (F), In $ Millions .. 20
Fig.4.6: Real Estate Developer U.S. Online Ad Spending - 2012 (P) vs. 2017 (F), In $ Millions . 20
Fig.4.7: Types of Sites Most Visited by Home Seekers . 22
Fig.4.8: Where Buyers First Learned About Their Home 22
Fig.4.9: Top 25 Realty Sites by Unique Visitors, June 2011 vs. June 2012 . 23

APPENDIX A: 25 - 34
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