Marketing Your Home
What Works Best?
The 2 primary factors that determine if and when your home will sell are price and exposure.
Setting the right price is crucial because under-pricing is like giving money away and over-pricing is just a waste of time because nobody buys over-priced homes.
Exposure that counts is exposure that reaches buyers who are the most willing, ready, and able to buy. Exposure to people who are not in the market or can’t afford to buy is meaningless.
The best possible exposure is MLS and the corresponding website, Realtor. This is where the vast majority of buyers are looking for homes, and where the buyers are the most ready, willing, and able to buy. MLS and Realtor.com ARE the real estate market!!
MLS (Multiple Listing Service)
MLS is the network that Realtors belong to that gives them access to show and sell each other’s listings, and comprises 90% of all homes on the market nationally. The Realtor commission, most often 6%, is split between the agent who lists a property and the one who sells it. Only licensed Realtors have access to MLS.
Realtor.com allows the general public access to see all the MLS listings. It has revolutionized the home search process, because homebuyers are no longer at the mercy of Realtors to see what homes are available on MLS. 90 % of all homes for sale nationwide are on Realtor.com, because MLS is 90% of the market.
Buyers use Realtor.com because it has the best selection, it’s easy to use, and it has lots of other useful information, too. For example, go to Realtor.com, enter your search parameters, and pick any listing. Click on “See listing details” and scroll down and select “Get neighborhood information.” Then click on some of the other options to see all the information available. You can get everything from the average prices and ages of homes in the neighborhood, to crime statistics and average SAT scores of students enrolled at the local high school.
The internet has become the primary search tool for most homebuyers today and more than half of them use Realtor.com. Of all online shoppers, 98% use MLS information websites, predominately Realtor.com.
Where online home-shoppers do most of their searching for homes
- 86% Search primarily on Realtor.com
- 12% Search primarily on other MLS listing websites
- 2% Search primarily on non-MLS websites, such as FSBO websites.
- Realtor.com and other MLS websites in the market makes it an essential ingredient of any home marketing campaign. It is the single most effective marketing tool available.
Where recent homebuyers first heard about the home they bought
- 79% Real estate agents and MLS information websites, primarily Realtor.com
- 7% Yard signs
- 6% Newspaper ads
- 3% Friends & Relatives
- 5% Other
Comparison of Marketing Alternatives
MLS & Realtor.com
The majority of buyers still use real estate agents when buying a home and 99% of all real estate agents use MLS. What is changing is that more than half of all buyers today are finding houses on Realtor.com and other MLS websites, and then telling their agents about them, instead of the agent solely making selections from MLS. The agent then shows the buyer the houses that the buyer has selected. The bottom line is that whether a buyer comes to look at your house because his agent found it on MLS or because the buyer found it on Realtor.com, it is still the result of an MLS listing, and you must have an MLS listing to be on Realtor.com.
A simple sign on the front lawn is a cheap and effective advertising tool, and should be part of any home marketing plan. If you have time and are patient enough, you can sell your home eventually by doing nothing more than putting a sign in the yard. The average time period for a house to sell using only a yard sign is 12-18 months, and will vary based on the amount of traffic on the street and the price of the home.
Newspaper ads can get expensive and sellers who are not interested in owner financing will have to weed out unqualified buyers. The majority of homes sold with newspaper ads are by professional investors. Newspaper classified ad columns tend to be filled with investor ads with headings like “$0 down,” “Owner Financing,” “Lease Option,” “Bad Credit OK,” etc. Investors typically inflate the home prices and give the buyer/tenant (who can’t qualify for a loan a lease option. Credit challenged buyers gravitate toward newspapers because of the prevalence of these kinds of ads, and because they know they would be expected to qualify for a loan if they dealt in the MLS/Realtor.com market.
The value of hold an open house is vastly over-rated. People who go to open houses are typically just looking, and any serious lookers would have seen the yard sign and called the phone number anyway. Realtors love to hold hope houses because they have a chance to meet prospective buyers who may be in the market to buy at some point in the future, and prospective sellers from the neighborhood who are planning to put their house on the market. Holding an open house is also a great way for Realtors to give their clients the impression that they are actively marketing the home when they are actually just promoting their own business.
Free Real Estate Magazines
Commonly found on racks in supermarkets and convenience stores, those publications exist to either promote a real estate company or sell advertising. They contain very little useful information for buyers, and due to the lag time between printing to actually being picked up and read (minimum 3 weeks), the listings are already out of date before they are ever seen.
For Sale-By-Owner websites get an insignificant amount of traffic from buyers. Buyers who do take a look get discouraged quickly by the limited selection and from lack of response from sellers when they try to make contact. Many of the ads are outdated and the homes are off the market, so sellers often don’t respond.
There are various things Realtors will tell potential listing clients to get a listing. Some of these things sound good, but accomplish nothing more than promote the real estate company. Example: “We’ll send out 300 mail pieces to all the homes in your neighborhood!” This is a way for the real estate company to advertise their company and generate listings. Neighbors are more likely to become sellers than buyers and if a neighbor or somebody they knew were interested in buying your home, the yard sign would let them know.
Another unproductive method some agents like to tell their clients about (as though it had value) is mass e-mails to agents informing them of a house for sale. Agents have access to the MLS and don’t need to be spammed with such information – it’s just an annoyance. The first thing the typical agent does when checking e-mails is delete the “House For Sale” spam e-mails from other agents.