The Housing Market and How Developers Can Cut Through
The housing market may be fairly stagnant within London and the surrounding area, but the regions (particularly the Midlands, North, and West) are buoyant. Fuelled by limited supply and high demand, the average house price is currently at an all-time high of £227,871.
Consumer confidence is still suffering however, as cost of living continues to grow faster than wages.
Raw materials remain at a premium, with some brick types having a six month turnaround. This not only delays builds, but also puts pressure on prices. Couple this with a shortage of labour, and the overall picture is that many (particular first time buyers) are being priced out of new builds. As such, developers have been forced to be more imaginative in how they sell their homes with various enablers enticing buyers to market. These include ‘sell your home in 5 days’ part exchange schemes and the government-backed Help to Buy.
Rightmove are still the dominant marketing tool for the housebuilder, with entry level costs for developer listings reflecting this. There seems to be a constant battle with developers de-listing and re-listing for periods in an attempt to drive down costs. These threats don’t seem to be working, and Rightmove’s size allows them to ride this out relatively pain free.
Developers need to be aware that portals are not the be all and end all. With home buyers rarely moving more than ten miles from their existing home, local press (property section and run of paper), radio and conveniently place outdoor sites are still a proven way of driving those not currently looking to move house into the ‘in-market’ funnel. Our own research suggests there is still a visible upweight in visitor footfall when traditional media is added to the media mix, and a reduction in numbers when removed.
There are some online formats outside of portals which have proved highly successful. Online geo-targeted video content helps to drive new traffic, and increase click-through rates (CTRs) more than standard banners and MPUs. With most developers having house types appearing at several locations, the cost of producing quality video content can be easily spread across several developments. With our own clients, we’ve seen video content drive CTRs between 0.9% and 1.5%, equating to over 1,000 click throughs in a two week period.
With so many fighting for share of the market, new build developers need to create a desirable brand that consumers can identify with – much like car brands have managed to do. Whether it’s low cost per square foot, flexibility in design, quality finish or energy efficiency, brands need to focus on their strengths. If consumers have already bought into the brand values by the time they are visiting/enquiring, this will no doubt ease the path to purchase.