Wall Street Journal Article: The New Condo (and Apartment Rental) Reality: Shadow markets

I caught site of an interesting WSJ article from a colleague’s facebook post (thanks Lisa Trosien) and thought it was important to share on this site. The article, a Q& A type post discusses the shadow market of condos on rentals.
Something that caught my attention was the author’s mention of new regulations imposed on condo developments by Fannie Mae. While it was quickly mentioned, the true ramifications of the changes go well beyond foreclosures. First, as of March 1, 2009, Fannie Mae requires that a condo development obtain 75% of pre-sales prior to receive financing. Prior to this date, a condo development only needed 51%. This difference places a huge burden to both the condo development and to the condo homeowners. Because financing is not available, potential homeowners are not as interested in buying at this development. Worse, the ones that did will have larger assessments, causing many to opt out of living in these homes and will put these homes on the market. Since the market is currently supersaturated, the homeowners fearing foreclosure will push the homes as rentals creating a larger shadow market in the already saturated rental market. To compete in this ever growing market of rentals, prices will drop and vacancy rates will increase. Talk about a mess.
Please feel free to let us know what you think about these short-sided solutions.

Post-click marketing and your bottom line

If anyone calls 2009 the year of engagement, I would rather like to call it, the year of the post-click. Landing pages are moving from a static register now type experience to one of segmentation, A/B and multi-variate testing, and higher conversion rates for all PPC and display ad traffic. I would be interested to see if anyone has moved dollars to better segment and convert their potential customers. Feel free to share your success stories!

The relevance of social media on real estate

So do you wonder whether facebook, twitter, linkedin, ning sites, or any other social media platform will generate quality leads that convert to happy home buyers or renters? Well, the answer simply is YES, so long as it is done correctly. First off, it is important for you to understand the fundamentals behind social media marketing, and I’ve enlisted the help of many colleagues to offer you Social Media Marketing for the Real Estate/Multifamily Industry. Keep posted to this blog to learn Real Estate/ Multifamily Social Media Best Practices 101.

what are your customers doing?

Check out this link to see how your customers interact online. This is a great tool to get a better understanding of your customers online interactions.

Have you resorted to price discounts to sell new construction homes?

With traffic levels at record low levels, have you reduced the price of your new homes to push sales?

Looking beyond the bleakness

Based off the Builder Confidence Index February 2009 rating (which I won’t post to spare us the already felt pain), these are extremely tough times for the real esate industry, especially with new home sales.  We are at record low rating levels, and unemployment continues to be top concern, so what is a new home builder to do? Throw in the towel and let the market adjust? For some, that may be the only answer. I hope that is not the case for our industry. Instead, we need to embrace the lower traffic levels and learn the skills needed to help guide people through the economic nosedive we’ve all experienced. We need to realize that sales teams are not order takers, and marketers simply can’t throw money blindly into print advertising. Interaction reigns, and the sales cycle will be longer because these interactions aren’t bought; they’re developed. Everyone in the industry needs to review their marketing mix and shift money away from blanket impression with no direct conversion. Interactive touchpoints for customers to engage and build trust is needed through the search process.

Interactive marketing; what it means to real estate and the multi-family industry.

We’ve seen a conundrum of new ILS’s, blogs, “interactive agencies” sprout since the advent of social media, but the question is whether these social platforms make any difference to the bottom line for real estate and the multi-family industry. The bottom line to the bottom line is YES, of course they do. But the better question for industry experts to ask is, “how does it positively correlate with an improved bottom line?” 

First, learn the behavior of your social media audience. You have to understand the cultural pulse behind the audience. This is very different than the traditional direct response behaviors learned from typical marketing strategies. These audiences are not into sharing your marketing message just because you blast it in their face. Actually, for these Gen X and Y’ers you are pretty much making a mockery out of the media channel. So, don’t do it. It’s as easy as that. Instead, provide a solid voice that shares the rhythms of this social group and let the audience’s ever-changing perceptions guide you on how to interact. This is not taught, this is learned simply by listening.

Do real estate marketers (and any other marketer for that matter) abuse social media?

Social Media Marketing…just how proficient are you?

Carmen Krushas

Carmen Krushas is Director of Marketing at the Belgravia Group, Chicago’s leading real estate development company. She was named 2008 Marketer of the Year by the Home Builders Association of Greater Chicago and specializes in interactive marketing, social media, search marketing and post-click behavioral marketing. Follow her on Twitter and through her many blogs found in the links section.