[5-DayForum] 5 Day Sale 1st Weekend December-Cherry Hill

Tue Nov 27 12:16:08 EST 2007

Hi Bill:

In the past year while immersed in studying the "online residential real estate space," let me offer this for your consideration as I know you have your doubts about "online advertising'.  That said, you are brainchild of the 5 Day Sale methodology so I share the thoughts below as "intellectual fodder;" not argument.

Of the 80% of buyers who search for homes online, most do NOT do so by going to individual real estate websites with the exception of a few such as Craigslist.  Most use the four major search engines such as Google, MSN, AOL, and Yahoo.  These search engines through “search engine optimization” pick up a given property search through what are called “vertical search engines (aka. other real estate websites).”   So, when you search using “homes for sale in Denver,” the property listings that “pop up” on the search are often not from a single source, but “aggregated” from many sources unbeknownst to the searcher.  This is a function of a given search engine's computer algorithm that ranks sites "organically."

While intuitively it makes sense that the site's with the most web traffic in a given area would be the place to advertise online, and with the exception of the largest vertical search engines such as “Realtor.com (a subsidiary of a parent company owned in part by NAR) that is true, it just isn’t necessarily the case.

The fact is that today, the internet has become a very fragmented information source and you just don’t know how a given searcher (or search engine) is going to find a given listing or 5 Day Sale advertisement.  This is why I believe that it makes sense to put a given listing or 5 Day Sale in as many places simultaneously online as you can.  In this way, the likelihood of a given listing or sale being picked up in a given search increases exponentially.  This is particularly true if your ad is written in HTML language.

One last food for thought regarding "tire kickers" in general.  

In the two case studies I conducted here in Denver, one went under contract and closed (I apologize to all Forum subscribers for still not finishing that case study and posting the full story of that sale on the Forum as I still intend to do so), the second went under contract but the buyer didn't qualify and the second highest bidder was too low (an investor).  As a sidebar let me contend that in my limited observation, "investors" are not "real buyers;" "owner occupants" are "real buyers."  I say this because I believe when we talk of "real buyers" that most of us think in terms of a buyer that will pay close to fair market value for a property less real estate fees.  Investor's simply can't afford to do so unless they intend to hold-the property long-term, which rarely is the case.

Back to my thoughts regarding "tire kickers."  In a seller's market I think it is a good idea to "weed out" the "tire kickers" as they distract from focusing on real buyers and maximizing a 5 Day Seller's "team" in spending more time with "real buyers."  Time well spent.

In a buyer's market, I think there is a hidden value to attracting "tire kickers," which in addition to posting online ads, using signs, and bulletin board postings is also accomplished by advertising your property for sale at lower "starting bid" price points.  I believe one of the "classic" questions asked of you (Bill) on the Forum is "why start my bid at 50% of perceived value?"  The standard response I see from you (Bill) and Forum regulars is that "you just can't start your sale at too low a price point."  The follow up from many unsuccessful 5 Day Sellers that I've observed on the Forum is that by starting too low - given their "undisclosed" reserve expectation - is that they had many "tire kickers" look at the property that either couldn't afford to bid (and maybe by definition they therefore should not be classified as a "tire kicker) or they had people looking to steal the property (perhaps investors).  Does advertising at lower price points attract "tire kickers" as well?

Interestingly, this is one of the "material" differences between Bill's classic 5 Day Sale methodology, and George Cappony's permutation of it.

Now to my point regarding "tire kickers."  In both of the case studies we conducted here in Denver, we had post "inspection period" follow-up from individuals who became aware of the property from someone who had seen the property during the "inspection period."  Both from those who left bids and those who did not.  I can only assume that some of these people who "passed along word of a quality property for sale" to other potential bidders or buyers, who were not aware of the 5 Day Sale inspection period, to be "tire kickers."  

Isn't the best (and often most expensive) form of advertising in all product categories "word of mouth?"

So, my contention is that in a "buyer's market," the more "tire kickers" the better.

That said, I respectfully ask for anyone's thoughts regarding the above ascertions.

Best to all,

Kyle

 hose who saw the online ads that were still posted and from people who    

Date: Tue, 27 Nov 2007 10:26:07 -0500From: bill at effros.comTo: 5-dayforum at mailman.howtosellyourhomein5days.comSubject: Re: [5-DayForum] 5 Day Sale 1st Weekend December-Cherry Hill
Kyle,In some cities people go to Craig's List to find homes for rent and sale.  In other's they don't.  There are too many web surfers and Googlers hitting other web sites, and no other single site you can be sure will be visited by any of the "real buyers".  Web hits attract tire kickers who complicate your sale without reliably attracting real buyers.Bill EffrosKyle Cascioli wrote: 

Hi Bill/Emily: Again, I think it depends on the market. That said, if they don't work as they did in our case studies in Denver, then why place the ad on "Craig's list?" Kyle

Date: Tue, 27 Nov 2007 09:02:16 -0500From: bill at effros.comTo: 5-dayforum at mailman.howtosellyourhomein5days.comSubject: Re: [5-DayForum] 5 Day Sale 1st Weekend December-Cherry HillEmily,I don't believe Internet ads attract the 3 real buyers.  They may bring in a fourth or a fifth, but you can't rely on them and they attract a disproportionate number of tire kickers who throw off your 25 by Friday night count.I'm sure your ad is fine.  Bill EffrosEmily Lyon wrote: 

We placed our ads today...will keep you posted on number of calls. Bill, we used your magic number of 124,500 for our property which we believe could easily sell in today's market for 280,000. We had to tweak the layout of the ad but kept the order in which things appear and Bolded/Capped that which you do in your book. We plan on completely following your method. 

Someone emailed me (assistant to the Univ. Denver prof) offering to place internet ads for us we would like to use their service. Anyone know his email--can't find it. 

Thanks, Emily Lyon

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