I have been reviewing residential real estate listings in various markets within Bergen County.  I am using information available to me on Zillow, Realtor, Redfin and Trulia.  I am specifically focused on trying to understand how the various markets within the county and surrounding areas are utilizing photo solutions to inform buyers of the characteristics and strengths of any particular listing.  Besides the “required” MLS listings I find there is a limited use of certain technology available to realtors to showcase their listings.  Other real estate markets have incorporated some of these methods into their marketing strategy and the brokers, sellers and buyers have greatly benefited  from using these technologies.

Are realtors and sellers getting all the value they can from the latest visual marketing technologies?

I am writing about the limited use of slideshow videos, videos, and virtual tours.  Based on my research on several popular residential real estate sites, I find very limited use of these solutions.  The use may be sporadic and limited to only certain markets or price points.  Some markets use these services for only the high end properties in the market.  Other markets may not use these solutions at all.  While still others at higher or lower price points may actually have a significant use of these solutions.  In some cases, mutliple solutions were utilized on the same property.  My initial take-aways suggest a level of randomness in how these solutions are being used.

Realtors certainly have varying reasons to decide to use one or more of these solutions.  This could be company policy, lack of available budget, their view on the return from the use of these solutions, and the strength of the market at that point in time.   Other realtors may have already determined how valuable and effective these solutions can be.  These solutions are used more often in more expensive or exclusive markets.  This is not surprising as the realtors have a bigger marketing budget to purchase these types of service. It may also be a competitive decision, or the buyers or sellers are asking for it more often.  It is possible that in lower priced real estate markets the realtors marketing budget may be lower and they may not have yet determined that these solutions pay for themselves and increase the sales price and commissions to the realtor. 

Why do some lower valued markets use virtual tours more often than some higher valued markets?

But in some other nearby towns, where median home prices were much lower than some markets where the median prices were higher, I did find that these solutions were popular with the lower median home prices.  Why is this happening in these lower priced markets?  It is possible that realtors or sellers in these markets may have already determined that these products offer great value.  And in the other nearby markets (towns) where the median or average home price may be much higher the solutions are not used.  And that is the point that there is spotty or limited use. 

How much more does a home sell for when a virtual tour is used in the marketing?

Despite the observed use, the increase in photographers offering these services (slideshow videos, videos, virtual tours, drone photography (include this one also)) has grown.  In addition companies which provide software and hardware (such as virtual tour software companies, or 360˚ camera makers) in support of these technologies have grown, both in size and the number of companies.  This suggests the increase in popularity of these solutions.  In addition, organizations like the National Association of Realtors, Google, and the University of Iowa are supportive of the use of these solutions.  A Google study, as far back as 2015, indicated that listings with images and virtual tours were twice as likely to generate interest to the consumer.  And the NAR website continuously supports the use of and the value of virtual tours.  The University of Iowa has published a study which quantifies the selling price increase to homes where a virtual tour was used (more on this in a future post).

I am seeking to determine why these solutions have not yet become even more popular in certain markets.  They are all discussed quite a bit in industry news reports, blogs and the NAR has supported these products.  Most photographers are offering some or all of these types of services.  In this and subsequent posts, I plan on delving deeper into these issues.  So why is this happening?  And more importantly are realtors, sellers and buyers at a disadvantage when these solutions are not used?  So I plan on discussing these issues and related issues in future posts.

But it is clear that realtors find these tools very helpful in that particular market.

I will continue in this post by sharing an example.  I recently noticed that a property in another town in another county, listed at about $550,000.  The listing broker used a slideshow video and a virtual tour, in addition to the typical MLS photos.  The property sold at a nice multiple over listing, and within only a few days.  In Paramus, I noticed there is very little use of these solutions.  I reviewed listing after listing and didn’t find much use of these solutions.  This was the case when I reviewed listings at around the median price of Paramus homes, about $616,000 (based on Zillow HVI), or at the median price of homes listed in Paramus (also based on Zillow) of $767,000.  It was also interesting to notice that the Paramus home market where listing prices were greater than $1,000,000, that these properties also did not generally use these solutions.  The property in the other county in my example was close to the median home price value, also according to Zillow.  Arguably, it was in a section of town where homes were less expensive and, generally, that particular neighborhood would likely have an effect to decrease the median home values of the entire town.  While I am not suggesting, from this review, that the price improved that much because of the use of the slideshow videos or the virtual tours.  But it is clear that realtors find these tools very helpful in that particular market.  While in the Paramus market, where prices were higher, these solutions appeared to be used less often, rarely or never.  A similar review of listed properties in a town like Saddle River reflects a much greater use, almost across the market, of these solutions and at all price points.  In some cases, lower priced homes in Saddle River used these solutions, while higher priced homes in Paramus did not (to be clear homes in Paramus which priced higher than the lower priced homes in Saddle River).

While my comments here are certainly anecdotal and the ability to generate a more comprehensive analysis is limited.  Although, I can share the results from a very interesting analysis that was done on this type of data, but in a California real estate market.  The analysis determined there was a connection between the quality of home photos and the number of photos on the time on the market and the sale price as a percentage of the listing price.  The primary take-away was that photos matter, the number of photos matter and the quality of photos matter.  While my questions here are on specific visual solutions, in addition to photos, there is a significant connection and relationship.  For example the MLS photos from a shoot are usually the same photos used in the slideshow video.  It can also be argued, if we accept the findings of the indicated study, that other photographic solutions may also have a positive impact on time on market, and an impact on sale price.  I will share more details about the California analysis, and possibly the report and a video which was published in a future post.

I have also noticed there is an inconsistent use of the terms used to define slideshow videos, videos and virtual tours on the various real estate websites, realtor websites or other resource websites.  In my discussions with various realtors I have also noticed that the terms are not used consistently.  The point is to clearly define and differentiate these solutions so realtors can make a best informed decision as to what might work best for their marketing strategy. 

Some ideas for future articles.

• define the differences between slideshow videos, videos, and virtual tours
• share the characteristics and results of the California analysis (discussed in this post) and why it should be important to realtors, sellers and buyers 
• share how Zillow, Realtor, Redfin and Trulia publish these solutions on their websites
• samples of these solutions can be found on www.steveg.photography and on www.viewingspaces.com 

If you are a realtor would you share how you use virtual tours, videos, slideshow videos and photos in your marketing strategy?  As a buyer or seller, what do you like to depend upon when searching for your home or when trying to sell your home?

Your comments are welcomed below.