Purveyors of mortgages spend most of their advertising dollars online, according to a new research report. Lenders spend a whopping 39 percent of their ad budgets online, the extensive 39-page report from Borrell Associates, an advertising firm in Williamsburg, Va., says. The other 61 percent is spread over numerous other media, with none commanding more than a 15 percent share.
Overall, lenders will spend some $10.16 billion this year on advertising, or about 4.4 percent more than they spent in 2012, according to the report.
Of that, $3.97 billion will go toward their online messages, while $1.42 billion (14 percent) will be thrown into cable TV. Also worthy of note is that some $95 million will be spent on broadcast TV, a 40 percent increased from 2012.
Lenders also will end up spending about $790 million in newspapers. That’s a 7.8 percent share of their ad budgets, and an 8.5 percent increase from last year.
That means the mortgage community is contributing to what may be the return of newspapers from the walking dead. While it is certainly too early to call it a trend, newspapers actually gaining market share in 2013, according to Borrell.
Save for a few markets, fat real estate sections in newspapers are probably gone forever, as are the clutter of homes magazines on street corners. But print “is by no means dead,” the company said in its report.
Indeed, real estate-related newspaper advertising has not only stabilized this year, it has actually increased a tad, up by 0.8% from 2012. At the same time, local magazines “are enjoying a sudden resurgence,” up 30.7%.
That’s not to say spending on digital media has faltered. Its up 16.9%, to a total of more than $15 billion, the study found. Fifteen years ago, when digital was in its infancy, it commanded less than 5% of all real estate ad dollars, Now, it holds a commanding 56% share.
But digital is not likely to grow, says the report’s principal author, executive vice president Kip Carsino. “We believe that the digital share of real estate advertising has peaked and that any future growth will be commensurate with overall growth in advertising expenditures.”
Borrell expects agent’s and brokers’ digital ad spending to peak in 2015 at $16.6 billion. After that, digital will be experience its first ever decline – and a sharp one – due largely to a mild cyclical recession in 2016, the report predicted. Than, spending on the digital medium should begin rising again.
The annual report, which sells for $995, examines the underlying trends in the resurgence of the real estate markets and breaks out spending by agents and brokers, developers, rental managers and mortgage providers.
About The Author
Lew Sichelman has been covering the housing and mortgage markets for more years then he cares to remember, starting as real estate editor at the long defunct Washington Daily News and Washington Star newspapers and finishing with a three-decade stint with National Mortgage News. His weekly column, The Housing Scene, is syndicated to newspapers throughout the country.