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The cost per lead for home buyer leads has declined sharply over the last 4 years. The median home price has increased substantially over the last four years.
What do these trends mean for you - the Realtor?
It means that real estate buyer leads are now a much better value. And if the trends of improving lead costs and increasing home prices continues – the value of real estate buyer leads will continue to soar.
CINC noticed these dual trends and set out to quantify what is the value of a lead and how has that value changed over time. Read the full report of our new Lead Value Index here.
Using the Google buyer Cost Per Lead, the Median Home Price (NAR), the average commission, and the percent of leads that close, we created the CINC Lead Value Index. The Lead Value Index approximates the commissions that can be expected from a dollar in advertising.
The Lead Value Index for the 4th Quarter of 2021 was 16.38, compared to 10.51 for the entire year of 2018. That shows that the return on real estate advertising was 56 percent higher than it was four years ago. In future quarters we will compare quarter-to-quarter results so that you can track immediate changes. Next quarter the LVI will most likely be much higher (better) than this quarter because the CPL typically improves significantly from the 4th quarter to the 1st quarter.
The document also shows the difference between markets. As would be expected, the cities with the best Lead Value Index either have a really high median home price or a very low cost per lead. Honolulu has the top Lead Value Index because it has very high-priced homes and moderately-priced leads.
Interested in more information about the Lead Value Index? You can check out a recent webinar where we discussed the LVI in more detail here.
You can access the full detailed report here.
CINC is the leader in online real estate lead generation with more than 3,000 clients. The CINC client marketing team manages almost $30 million in search and social advertising spend annually.