Property Market Goes Online
Increasing access to the internet via smartphones and better broadband is changing how buyers search for, and how real estate agents market, residential properties. Results of an IOL Property survey show that online listings generate leads, but print advertising still has a key role to play.
About the Study
The research was conducted by an independent party on behalf of IOL Property with the aim of establishing how estate agents make use of the internet to market properties.
Three hundred agents in metropolitan areas were contacted and asked to answer questions such as where they advertised, how much of their marketing budget was spent online and whether they believed that the portals provided value for money.
Print is good for branding and mandate acquisition…
Newspapers have long bemoaned the difficulties of keeping up with the internet, both in terms of its flexibility and price, and it’s no different when it comes to advertising property – more and more buyers are using the internet to search online as opposed to buying the Sunday papers. As such, agents are increasingly spending the bulk of their marketing budgets online rather than on print. The IOL Property study indicates that 67.3% of participating agents are now spending 50% or more of their marketing budget online while 25% of the 67% spend more than 90%.
The proof is in the fact that 91% of respondents indicated that most (more than 50%) of their leads came from the portals, and only 9% found that their own websites competed with the portals on an equal footing. The remaining 31% either did not know or did not provide an answer. In terms of own websites, 87% of respondents indicated the use of a national/regional agency website, while 7% had a branch-specific website and 6% didn’t have a website at all. “It appears that agents are opting to focus their time and finances online not only because it is cheaper than advertising in print, but also because they seem to find that the property portals generate better sales leads,” said Grant Leigh, CEO of IOL Property. “However, print is still a very popular from a branding point of view, which is key to mandate acquisition”.
These findings are in line with research cited in the National Association of Realtors Digital House Hunt report, which indicated that “nine in 10 homebuyers today rely on the internet as one of their primary research sources, and 52% turn to the web as their first step. In fact,” it continued, “real estate-related searches on Google grew 22% year-over-year.” This trend is gaining traction in SA, with buyers doing their homework online before contacting agents to view a property.
At this point social media platforms such as Facebook and Twitter seem to be having a negligible effect, with almost no agents finding them useful in terms of marketing property and gaining credible leads.
The Big 3
As with different newspapers, not all portals are created equal. The study revealed that 52.2% of agents advertise on the “big four”: Private Property, Property24 and IOLProperty.co.za. Many agents – 18.58% – also made use of various property feeds, ensuring maximum coverage of their listings, while 11% of agents made use of Gumtree to market their properties.
The Perception of Value
The study also asked agents if they believed the portals were making any money, in order to determine whether their perception of its value was valid. Two-thirds responded that the portals were making money; the other third wasn’t sure.
“It’s true that most of the portals have at best been breaking even over the last few years, with some haemorrhaging millions of rand in an attempt to capture the market,” said Leigh. “At present the portals are definitively offering value for money.”
More data from the study will be released in 2015, with the focus on the effectiveness of online property marketing.