How print packs a premium for real estate vendors
Research shows adding print to an online real estate advertising campaign results in quicker sales for a higher price.
Data reveals the power of print
HOMES are sold faster and for more money when advertised in a newspaper, according to new analysis of 850,000 homes sold over the past two years.
Average prices for houses increase by 8.7 per cent, or almost $50,000, in Perth when advertised in print and online compared with online alone. In Sydney, the city with the most expensive property market, the difference is on average $41,147 (or 5.1 per cent).
Similar results have been achieved in all capital cities, as seen in the table below.
With newspapers underpinning a campaign, offers come in faster that can shave seven days off the time a house or unit is on the market, according to property research company CoreLogic, formerly RP Data.
Success rates of sales also increase when a real estate agent ensures print is on the campaign schedule.
In Melbourne, the sale of a house during a campaign rises from 63 per cent to 84 per cent when it is advertised in a newspaper. The results for other capital cities are similarly dramatic – Sydney (+11 per cent), Brisbane (+8 per cent) and Adelaide (+6 per cent).
CoreLogic studied the sales history of 850,000 houses. The company’s analysts investigated where each property was advertised, its time on the market, the offer price and the value of the final deal.
The data also shows the depth of discounting decreases when properties are advertised in print, especially at the premium end of the market, says CoreLogic’s head of solutions, Greg Dickason.
The research is the first from a non-newspaper publisher that provides statistical evidence of the value of print.
CoreLogic decided to undertake the project to better guide real estate agents on how to structure a media campaign to maximise the price of their client’s home.
Mr Dickason says the research should end any reluctance by a home owner who might not believe that marketing helps sell their asset faster and for more money.
The data has been collated to create an industry service called Media Maximiser, which tags almost every property that comes on to the market with its original price, where it was advertised, when it went on the market and was finally sold, and the difference between the asking price and the final deal.
It has given publishers further evidence that print is still a powerful tool.
Since last year, Fairfax Media's property portal Domain has run advertising in its newpapers and websites that highlight that 3 out of 4 vendors use print to sell their home. News Corp Australia has used the CoreLogic data as a basis for a marketing campaign promoting how a mix of print and online advertising results in a higher price for vendors and a quicker sale than online alone. Metro Media Publishing, which was taken over by Fairfax this week and is to be consolidated into Domain, also plans to use the research for trade marketing and to arm its agents with the right knowledge to effectively market a home.
CoreLogic's Mr Dickason says: “We can see where a local newspaper has 80 per cent of listings in its area, and the missing 20 per cent; and then we analyse the sales cycle of all these properties. Those who list in a newspaper sell faster, or they sell with a lower discount.
“You can then measure the impact of a newspaper and portal on the selling success of a property.”
Mr Dickason says there are three factors that determine a successful sale:
· Whether a buyer is found
· Time on the market; and
· Any price reduction to strike a deal
As shown in an example of a Media Maximiser analysis below, property in the inner-west Sydney postcode of 2046 achieved an average 8 per cent jump in success rate, was one day less on the market, and a near 5 per cent drop in discounting when advertised in the local press.
John Bongiorno, director of Melbourne real estate group Marshall White, says he takes media data very seriously. According to his company’s figures, 87 per cent of buyers look online and 68 per cent use both digital and print.
“We monitor it aggressively to get the best response from our clients. We spend millions a year on marketing,” he says. “We see properties advertised in print do much better.
“There was a house on Stuart Street in Armadale where one week we advertised online,” he offers anecdotally, “but we weren’t happy with the numbers at inspection. The next week, we put it in print and the numbers more than doubled.”
Not all buyers are created equal
According to Tom Panos, general manager of real estate sales at News Corp Australia, selling property is a sophisticated exercise that involves locating “the must-have buyer”.
A former agent and still an auctioneer, Mr Panos dedicates a lot of his time to coaching agents. Psychology plays a big part in the way real estate is marketed. “Not all buyers are equal – some are more valuable than others,” he says.
“As an agent, when you’re marketing a property, you’re positioning that property in the buyer’s mind - and what it’s worth,” Mr Panos says.
There are buyers he categorises as “internet intellectual buyers”: intelligent, rational, and keen researchers. However when they do buy a home, these kinds of people make rational, calculated decisions.
“And when you’re trying to sell a property, you’re also trying to appeal to the passive aspirational buyer who buys emotionally,” Mr Panos explains.
Newspaper industry data shows that print attracts more affluent buyers than online.
Data from emma (Enhanced Media Metrics Australia) finds that when it comes to house hunting, buyers with an income of more than $100,000 are 33 per cent more likely to read newspapers than the general population, and 74 per cent of them use property content from news publishers.
CoreLogic’s Greg Dickason relays the story of how his colleague Craig Mackenzie, the company’s chief legal officer, bought his new home.
Mr Mackenzie was not even thinking about moving home until a newspaper changed all that. Mr Dickason continues: “He said to me, ‘I was sitting down having a cup of coffee, it was an ordinary Saturday morning, the kids had just been to sport, and my wife was flipping through the paper.
“‘She said, ‘hey, look at this property, I really like it, I love the kitchen – let’s go see it!’
“So, from not thinking about buying a property, he and his wife walked through an open home and made an offer that afternoon. Was he in the market? No. Would he have spent time on realestate.com.au or Domain looking at properties? No. But because he was paging through the paper, he became an active buyer.”
This type of story might explain why a recent survey of real estate agents by Real Estate Business found 58.6 per cent of respondents believed print had “always worked well and always will”.
News Corp’s Tom Panos says: “Print is the media that gets people who are not even looking for a house, who passively flip through real estate sections and see a house they love. The next thing you know, they go to the open inspection.
“They’ve got the advertisement sitting on their kitchen table for the next four weeks, and every morning when they have breakfast, they start visualising that this is going to be their home.
“They’ve begun a love affair with the property.”
Covering all bases
Crucially, while print is popular among big property spenders, there is significant crossover between print and online.
Newspaper industry data from emma shows around half of all prospective buyers who use real estate websites also read print sections; the same is true of tablet audiences. Some 42 per cent of mobile users, while typically younger, also read print sections.
The key behind a successful sale is to “cover all bases” across print and online, according to Double Bay agent Gavin Rubinstein.
Mr Rubenstein has been the top salesperson for Ray White in NSW for the last two years. Over the past year he has sold more than $150 million of property.
The 27-year-old says print is “a no-brainer”.
“If you’re going to make the most of this one shot that you’ve got [at selling a luxury home], why would anyone not risk a few hundred bucks when you could potentially gain more?”
News’ Mr Panos explains a pitfall of an online-only strategy campaign. “There are thousands of houses online. The research shows that unless you’re on page one or two of the search results, you’ve built a billboard in the forest.” Print triggers homebuyers to go online to find what they are want, he says.
“You’ve got to make sure your online and your offline are in line.”
In Perth, where auctions are not as popular as on the east coast, print plays a more vital role. On a Saturday, the second half of The West Australian is entirely real estate, and just about all property sold in Perth is at some point in the paper, says its sales director David Bignold.
“We’ve seen so many things move over time to online – CarSales, realestate.com.au – but if you want the best possible results you really are mad not to commission an agent that uses newspaper advertising,” Mr Bignold says.
The engagement and “stickiness” of print is much higher than online, Metro Media Publishing chief operating officer Trent Casson says.
“More than 50% of traffic online is mobile, so it’s consumed in snippets,” he says, “on the train, in the lift, in a phone call.
“[In print] there is an amazing array of journalists that people want to read, there are opportunities for editorial about the property, and opportunities for agents to present their brand. Print offers a more premium experience...‘property porn’ as they call it.”
The size of a print ad affects the perceived value of a property, News' Mr Panos says, citing a study of 200 adults who looked at ads of different sizes for the same house.
Respondents perceived the value of the house in a half-page ad as 24 per cent more than the quarter-page,” he recalls. “The house was perceived as 46 per cent more valuable in a full-page ad. You don’t want a $1 million house in a postage-size ad.”
CoreLogic’s Greg Dickason agrees. “When an agent is able to work with a vendor and get commitment to selling a property, and the vendor is prepared to stump up real marketing dollars, they’re more likely to sell.
“When you’re more committed to sell, you’ll take the first good offer – reducing time on market and discounting.”
Easy access to data means agents can now show vendors the evidence of the power of marketing in print.
“If an agent asks a property owner to spend $5000 on a vendor-paid advertising package based on trust, that is a hard ask,” Mr Dickason said.
“But if an agent can prove using data that the investment is more likely to result in a price difference of $20,000 to $40,000, then that value proposition is a lot easier for a seller to understand.”
“A serious seller attracts a serious buyer,” says Tom Panos.
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