On the 343rd episode of Mail Right Show, Jonathan Denwood and Robert Newman discussed when to invest in digital lead generation, considering today’s real estate market. Robert Newman is the founder and CEO of the inbound marketing agency, Inbound REM and has had tremendous experience in the real estate search engine optimization field for over a decade. On the other hand, Jonathan Denwood is the founder and CEO of Mail Right, a platform that combines a variety of digital tools into one convenient, user-friendly package.
Current Real Estate Situation
According to Google Fortune Magazine, home prices will remain high until the end of the year, and a long-overdue adjustment in the housing bubble is apparent. In the past few years, housing prices have grown 34%, and by 2% in the last five months. Statistics from April and May show a market decline. Sales are down so much that for the first time in two and a half years, available house inventory has increased— to 30,000 properties in April over March of 2022.
According to the Consumer Index, the overall increase in the cost of goods and living expenses has been 8.6%. Some certain places will be inordinate the impact because fuel increased by 106%. Due to continuous price hikes, other areas such as California are experiencing a seismic shift in the ability to purchase a home and where to buy a home.
There are a lot of variables that cause a pricing bubble. In the last two years, home prices have increased 34.4%. And the previous two years should be compared with the 7.6% wage growth during the same period. New homebuyers can either afford a mortgage or set money aside to create a down payment. So, when they lose 25% of their net relevant value, we start seeing inflation climb, which is when home prices become unattainable. Fed will raise interest rates and keeps doing so until inflation drops.
New homeowners typically make up between 25 and 45% of all buyers. However, it decreased from 45% in 2019 to 27% in 2021. That would be ordinarily unsustainable, except it happens because people who own homes already are driving the relocation craze. When an employee is instructed to reside where the employer is, it creates a lot of a seismic shift and artificially inflates at least a percentage of the real estate market. Another variable to consider is although there’s been a lot of buying, it came from investors rather than people looking for a starter home; about 40%of the homes on the market are bought by people with two to three or four houses.
When To Invest in Digital Lead Generation
The housing market is a bubble, and you should have known it would come to a halt. At some point, many buyers will go into the market when the price lowers a bit. That said, this is the right time to invest and build good content on your social media platforms and website that will feed leads for six months. That way, you’ll get ten times the return on your investment. But on the other hand, you’ve got to control your costs. Look at your future marketing expenses, especially in the direct marketing area. Think about either saving that money or repurposing it into long-term strategies.