It’s all about providing useful information.

This is obviously a tricky question and a matter of much debate today. Which is better for showing potential customers an online preview of a home: photos or video? As they say, beauty is in the eye of the beholder. Both have some strong arguments for and against, and at the moment I believe the correct answer is that it comes down to personal preference.

Let’s examine Photography.

For marketing homes online, it’s hard to go wrong with some quality photos from the best angles of the home. Some of the main advantages of photos are:

• You get high resolution for the relatively small file size.
• The digital photo output is easily manipulated for the web and rarely needs much editing.
• Cameras have been around for awhile now. Remember blowing on the film that came out of your Polaroid or when you got your first Kodak? If you choose photos to create your tour, odds are you are much more likely to be able to shoot some great shots on your own than if you choose to create your own video. Bob Sagat might like your home video, but I’m not sure potential buyers out there will.
• Affordability and high quality of a professional photographer. There’s been a need for professional photography for a long time, they are much easier to find than professional videographers.
• Digital cameras are abundant and affordable. If you don’t already own a decent one, it’s not hard to get your hands on a good one, and you know professional photographers will be equipped with some of the best!

Nevertheless, still photography has some major shortcomings when showing off a property. We’re not talking about showing images of artwork or sweeping views of beautiful landscapes. Home shoppers want to find out as much as they can about the honest truth of a home before dedicating their time to viewing it in person.

• Photos are static, stationary. One photo will give you one view. But rooms have many views from many angles you would have to supply several photos per room to accomplish what video can.
• Sometimes a photo of a room can feel misleading or distorted. Haven’t we all seen the photos with a nice telescopic or wide angle lens that shows some grand living room or entryway, only to arrive in person and wonder where the home we looked at online has gone? In order to effectively market properties there is a need to show them in the best light to entice viewers, but beware of manipulating or deceiving potential customers to get them in the door. This can foster resentment and ill will and ultimately lose the sale.
• Depending on your choice of equipment, angle, and number of photos per room, there’s only so much that you can effectively show with photos.
• Professional photographers can be overpriced. I’ve seen amazingly detailed, beautiful photos created by some photographers, but they can charge over $300 for their real estate shoots. With the quality you can get these days using your own affordable personal equipment, it’s hard to justify spending that kind of money per shoot. Why not do it yourself? My mom is creating a website using her iMac and it looks like she paid someone $3,000 to build the site, create the media, and weave it all in to a great looking site. The tools are out there today for us to grab hold of and do it ourselves including digital photography!

Let’s take a look at what video has to offer.

Using video to show a home online has some inherent advantages over photos, but it’s still in its infancy on the web. People are continually becoming more comfortable with what video has to offer them on the internet. This is clearly illustrated by the explosion in numbers of users of sites like YouTube.

We are a society that grew up around television and we know that video on the internet, like TV before it, can give us much more information in a shorter period of time than still photos or plain text you’d find in newspapers, magazines, and books. Here are some major reasons for using video:

• A video tour more closely shows the images of the way we would see them in person. We move through the home walking and turning our heads, we don’t stand in the middle and spin around, or go from room to room opening our eyes, taking a peak, closing our eyes, moving the next and opening them again.
• Multiple continuous angles and perspectives of each room – not just one or two.
• A more honest reflection of what the home looks like if you were there in person. It’s much harder to hide or conceal with moving video images with photos you can easily show only the angles & views you want.
• More information! Video can capture 30 frames per second, so after 5 minutes (600 seconds) video will give users 18,000 images! A video walk-through gives us a similar feeling to being there in person.

Some major drawbacks exist today in terms of video quality being played back on the web. Some people are still using dial-up to access the internet.  It doesn’t make sense for these people to download a 5 minute video that could take hours!

• Thanks to much more data being packed into a video file, it has to be compressed significantly in order to be effectively broadcast on the internet. Much of the quality is lost in this process.
• It can be difficult to create a high quality video due to the simple fact that you are moving. There are many devices out there that can help stability, but this is a major concern. Viewers don’t want to watch your own personal Blair Witch horror flick!
• Video can be more expensive. Typically the tools required to shoot a high-end video are more costly than what can be acquired for photography. A high-end HD digital camcorder along with stabilizing equipment can easily cost over $2,000.
• Video editing skills are usually required. It’s tricky to shoot a great video walk-through on your first try. Either due to awkward moments or a not so graceful step or even backtracking across a room you’ve already shown there are many reasons to want to edit your video. And this takes some practice!
• Real estate videography professionals can be very hard to find in your area. Wedding videographers are more readily accessible, but have they gotten on board with shooting real estate video tours yet?

Right now it’s clear that if you get a fuzzy, wobbly tour that takes too long to download, viewers won’t watch your video. Pictures don’t have this worry. They load so fast that a viewer can easily browse 10-20 in a matter of seconds.

However, if video can overcome its issues of quality and size then I think it is clearly the better medium to showcase your home to buyers who are viewing online. Whether that day has come or not is up to you to decide, but as internet capacity expands, memory cards hold more data, high-quality camcorders become more accessible, and high-speed internet more commonplace, video is poised to take online real estate marketing to the next level.

The title for this post was from an actual listing description. Apparently, the selling agent thought it would grab attention and draw traffic to the house. I’m sure it did. The title certainly caught my attention and I’d like to see more about this listing based on the title alone.

The Seattle PI posted an about the listing description, and the fact that sellers are getting much more creative with their choice of words due to the down market. The article provided some classic examples and their English translations.

A few of my favorites:

• 2+ bedrooms: The room in the basement isn’t a legal bedroom
• Motivated seller: They need to sell before they default on their mortgage
• Cozy: Tiny

Skyline Properties agent Ira Sacharoff is blunt in his assessment of listing descriptions: “They’re mostly lies.” Another agent was quoted as saying that some listing descriptions are “entirely bull.”

I am not one opposed to creative marketing. Just see these examples of marketing pieces that I sent out when starting my website design business back in 2005. Both of these postcards were very effective in jump starting my business.

But creativity does not trump honesty. When it comes down to it, buyers of real estate want as much information as possible about listings they preview online. With that information, they can decide which listings are worth visiting in person. Don’t waste their time with BS descriptions and misleading information.

The last thing a buyer needs is to find a listing that looks & sounds great online, but turns out to be a bunch of exaggerations and a big waste of time. The seller may be focusing on the quantity of people that walk through the front door, but isn’t the quality of those leads more important?

To effectively sell or rent a home there are typically marketing costs involved.

Someone has to do some work to get the information that a home is for sale or for rent out to the public. How this cost is justified is up to each person. Whether they choose to use high quality flyers, postcard mailings, online marketing campaign, professional photographer/videographer, etc, – there are many costs to consider.

This marketing cost exists for both sellers and landlords. There is an opportunity cost for not selling (mortgage payments) or not renting (loss of rental income due to vacant units). Agents and landlords should weigh carefully the costs of marketing and not marketing and the consequences of both.

Let’s look at this from the agent’s perspective, but the same determination could take place for a landlord. There will just be different expenses and time frames to consider. If an agent were to sell 10 homes per year on average with their current marketing expenses, what would it take to justify additional marketing expenses?

For example:
An agent comes across some new fangled marketing tool that costs $200 per home, and says it can improve their productivity by at least 10%. If it does, the agent should be able to sell 11 homes this year, one more than normally. Assuming an average sale price per home of $300,000 and an average commission of 2%, the selling agent should stand to earn an additional $6,000 of revenue.

In order to justify this additional $200 expense per 11 homes, the agent should be able to make more revenue than their added cost. In this example, the agent stands to incur $2,200 in additional expenses (11 x $200 = $2,200), but will earn $6,000 in additional revenue giving them a profit of $3,800.

Further productivity brings the agent even better returns. So if this agent sold 12 homes in that year instead of 10, their total additional marketing expense would be $2,400, but their additional revenue would be $12,000 for a profit of $9,600. Every additional home sold that year exceeding their norm will bring this agent $5,800 more in net revenue.

Here is a table to make it a bit clearer:

Not only will the agent’s productivity increase, but so too will their marketability. As the marketing tool improves their productivity, the homes they represent decrease their time on the market. New customers will be attracted to this as they naturally want their homes to be on the market for as short a time as possible. The agent might also be able to eliminate some of their other marketing expenses increasing their profit further!

The bottom line is…

By trying a new marketing tool the agent does incur an added expense, but with a 10% or greater increase in productivity expected, this illustration shows that it would substantially pay off for them. Doing nothing new (a.k.a. the status quo) could save the agent some cash; however, they could be losing the opportunity to sell more homes. There is a risk to trying new marketing tools, but clearly if it can make you more productive, the rewards can outweigh the risks.

When previewing homes online, have you ever run across some that have a status of Contingent? Do you know what this means? Do you usually forget this home and keep searching?

Many prospective buyers shy away from homes that are contingent because it appears that an offer is already in motion. Why waste the time on a home that isn’t available? This may be a big mistake.

An attempt to shed some light on the Contingent status of a home…

Most real estate listings will have a “Status”. Example statuses include:

• Active
• Subject to Inspection (STI)
• Contingent
• Pending
• Sold

Most of these are self-explanatory…

• Active means that the property is for sale. Come on over and make us an offer.
• Subject to Inspection means that a buyer’s offer is pending their inspection. The buyer will hire an inspector to make sure that there are no problems with the condition of the home. If the inspection yields issues that need attention, the buyer may request that the seller fix these issues, after which their offer to buy becomes official. This is especially common in buyer’s markets, like we are experiencing currently. In hot markets, as seen during the past few years, many buyers were waiving their inspection all together in hopes of making their offer more attractive.
• Contingent gets a bit tricky. Essentially, the buyer wants to make an offer, but must first sell their own house (so they have money to buy). The buyer has already inspected the house and is ready to make an offer… they just don’t have the money available until their own house sells. Thus, their offer becomes “contingent” on them selling their own house first.
• They make a contingent offer on the house, agreeing to buy it once their house sells. The contingent offer is good for a specific duration, usually 30-45 days, during which if the buyer’s house sells, they are contractually obligated to purchase the seller’s house.
• The seller can accept the contingent offer, but should do their own verification and make sure that this buyer is credible. One thing to check for sure is the buyer’s house and asking price. Once a contingent offer is agreed upon, the buyer must put their house on the market within 3 days and to advertise it with the multiple listing service (MLS).
• During the contingent period, the seller can certainly entertain other offers, however, the contingent buyer has “first dibs” during this time, assuming they sell their own home first.
• Sometimes the status can be shown as CTGI – contingent on inspection.
• The inspection contingency (if there is one) is removed before the property goes contingent. Once the buyer removes their contingency, the house can go pending. The contingent buyer has spent the money for whatever inspections they wanted, so they have demonstrated their commitment.
• A contingent house is still available for other offers, but the new buyer will have to wait an additional 3-5 days to find out if their offer is accepted. (Sometimes this waiting period is 10 days, and is decided by the initial contingent contract between the seller and contingent buyer.) The contingent buyer has this period of time to come up with the money and move forward with the sale. If they can’t come up with the money, the seller may accept the new buyer’s offer and be released from the contingent contract.
• So, in short, the contingent offer can be trumped at any time unless the contingent buyer can suddenly come up with the money to move forward with their purchase agreement. In this respect, a contingent house is definitely worth pursuing.

• Pending means that the inspection period is over and the parties are just waiting for financing and paperwork to be completed.
• Sold is what we are all hoping for in the end!

The truth is, a contingent home may still be worth seeing. Many contingent deals will fall through, leaving the seller looking for a new buyer. Even if in a contingent contract, the seller still has the freedom to accept another offer.

Here’s a few additional resources for learning more about real estate status:

• An informative post on “The Financing Contingency” from Craig Blackmon, as shown on RainCityGuide.com
• “Placing a home in contingent status immediately cuts way down on showings, as other agents do not like showing property to their prospects that they cannot buy.” from All Experts.com

I wanted to take a moment to recognize some great blogs out there for our consumption in the real estate world. While developing Cool Toors and TourVista over the last 1 1/2 years I’ve appreciated the info these sources have provided me with. I wanted to review them each briefly to share them with our readers. Thank you guys for all your great work!

If you haven’t had a chance to read any of these blogs, I’d recommend you spend some time catching up on your reading! They do a great job providing us all with a wealth of knowledge that can help any of us improve our expertise in the field of real estate marketing.

Future of Real Estate Marketing- by Joel Burslem

• Incredibly knowledgeable on the subject of online real estate marketing, Joel has been providing us with great insights into the industry.
• Joel’s position with Inman News gives him access to some of the most influential people in real estate today and his ability to interview and write great blogs has attracted many more industry professionals to seek him out.
• This blog is packed with important details and great video interviews, is extremely well organized, and also very easy to read – a great combination!

My Tech Opinion- by Reggie Nicolay, NikNik, and Chad Johnson

• These three provide some great opinions on new technology to help real estate professionals in their business. Whether it’s about a new web tool or a flashlight digi-cam – you can find some valuable nuggets on their blog!
• It’s great to have a mix of personalities on this blog as the three take turns writing on the blog. As I’m learning, it’s quite difficult to stay fresh and write about something that’s appealing to many different groups.
• This blog provides a great variety of long and short topics, so checking their site out from time to time leads to many pleasant surprises!

The Real Estate Marketing Blog- by The Internet Marketing Sheriff

• The Marketing Sheriff has provided me with a lot of “best real estate marketing practices” — what he says is his goal in bringing actual free and useful information to the public. Thank you Sheriff!
• The Sheriff provides several great blogs on his website dedicated to real estate marketing. There are ample posts and topics to be found on his blog, often daily, but always multiple posts per week.
• If you are interested in various, useful and free information about real estate marketing, take some time to visit this blog!

There are many great blogs out there from which we can learn a great deal. Sharing information amongst each other is a great way for us all to improve our services and provide value to our customers. This was a sample of a few blogs that have influenced me lately – keep up the great work! If you want to learn even more, here is a recent list from International Listings (Worldwide Luxury Real Estate Specialists Since 2001) of their Top 50 Real Estate Marketing Bloggers – enjoy!