Real Estate Videos are Hot (Videomaker Magazine)

These current economic times have everyone on edge. A house for sale can sit for months in this tough real estate market, but one bright spot enlisting interest is real estate video... 

Great article, Fred.

I think your best tip was: 

"This business is all about price.  If you want this to be a business instead of a hobby,

you need to understand that first and foremost."

So true!

-Nick

Great Article, written by the original master of the business! Thanks Fred.

Fred, thanks again for all of your help. For those who haven't read his AR blog, he gives step by step instructions and is super helpful.  He is the best of the best in RE video.

I thought I was a stud getting my workflow down to 4 hours (5 when I have a hard time making cuts), but sounds like you've got your shoot and edit down to 2 hours or less AND your videos look better than mine! Thanks for the ideas, and I promise I won't be stealing your web site like that "Illinois" guy.

Fred about the Real Estate Agents (Realtors)... I agree this I know is a fact.

"90% of real estate clients are online, yet according to the National Association of Realtors, only 6 out of 10 real estate agents have their own website. That says a lot! Buyers understand the value of real estate video. Sellers understand the value of real estate video. The one group that generally does not is your potential client: The real estate agent. Only a small percentage, maybe only 5% of real estate agents understand the value of doing real estate video."10

I work with Long & Foster Real Estate, the largest privately owned company in the country and they have thousands of agents on the east cost and give them a free website...and a lot of the older agents and some younger agents don't take advantage of a free website let alone consider a video...these folk will just be left behind. All I know is all my clients appreciate a video of their home as a marketing tool.

Fred is the expert, thanks again Fred for the great article.  Terri, you are so right.  Have you found anyway to get the Realtor's attention?  Going to the local corporate offices doesn't seem to work because each Realtor makes their own decisions.

This appeared in my email inbox today.  Though I'm not sure of the source of the statistics, the the bullet points interest me.

The page ranking jump and the 73% of homeowners figures I've seen others here on The Hood address before, at least anecdotally.  Yet, if accurate, "ONLY 0.8% of Realtors are using VIDEO".

I wonder what the definition of "VIDEO" is in this context/stat . . . Full-Motion and all the variations that others in the RE community (or those serving them) pass off as full-motion (stiching / panos / 360-spins / etc).

Fred, I appreciate your post, immensely.  I recognize that you are doing quite well in this business, and I'm sure your formula, and the rules you've learned and are sharing for being successful, work quite well.  I'd like to walk with you a bit on some of this, though, because my experience, to date, has been a bit different from yours, and I suspect  that's because markets vary from place to place.  I have a contact who does business on Mercer Island, Washington, and his experience appears to differ from yours, as well, and to be more like mine.

First, I DO use a jib and dolly on occasion (the guy in Washington uses at least a slider, and may use a jib), when the property is listed at a high enough price to produce enough revenue to pay for it.  I also bring and use a large number of lights to set up many of my shots.  On the last shoot, I even hired a grip, and still made money.  Now, to be sure, I don't depend on real estate entirely for my income.  I make a fair number of corporate videos, too.  Still, I have yet to even MARKET my real estate video business, except to have a single meeting with a single broker, and the phone has been ringing, providing enough business that, really, I'm too busy.  I may have to expand and hire someone.  And that's before I meet with a gentleman in the nearby large city who has 400 agents working for him, and is more than willing to promote my services to them.

In my original pitch to that one broker, I sold the idea of "return on investment" (ROI).  I pointed out that those who got ahead of the video curve would have a better batting average on getting competitive listings, drawing listers who liked the videos they see for non-competitive listings, and getting unrepresented buyers who felt comfortable with them "as shown on TV."  For many realtors, acquiring a single extra listing in a year, or a single unrepresented buyer, would pay for most, or all, of the videos they buy from me.  In addition, I think that good video will, eventually, be table stakes for all realtors, the way virutal tours and high-quality photos are now.  Only early adopters will really receive the benefits, since they gain a competitive advantage for awhile, increasing their books of business and, ultimately, bases of referrals.

I've been able to sell some videos for four figures (recent example, below), and others for less, but then I don't take the jib, and take only a wheelchair dolly or skateboard dolly, to the lower-priced properties.  Even for the lower-priced properties, though, I charge more than your website pricing schedule, usually.  

I don't use the jib and dolly for artistic reasons (though the artist in me is happy about them), but because I thought it important to build a "barrier to entry" against other videographers who may crop up in my market.  It has occured to me that anyone with some reasonable skills and a Canon 7D or equivalent can make acceptable real estate videos, and that includes current still photogs.  However, not just anyone can afford the equipment to get some of the shots I get, and I don't want to get in a situation where I'm making a commodity product and competing on price, only.  In addition, I have a home sound studio and equipment, write quickly, and am lucky to have made part of my living as a professional voice talent, so I include a script and VO for what I do.

My thought, at this point (and real market conditions evolve and can change my mind in a flash) is that I want to maintain a quality edge over my competitors, helping the agents who work with me to keep their batting averages on acquiring competitive listings high, and then use that ROI that they get to charge more than the competition.

Will it work?  Time will tell, but the early returns are encouraging, and may represent a different business model that works in this market.

Here's a link to my latest to demonstrate what a jib and  dolly do for you:  http://www.youtube.com/watch?v=wv6Y95QUVVQ

 Stuart:  Definitely think building a "barrier to entry" is a great idea... I've done that with the Steadicam..  Most videographers don't have one, don't want to buy one, and most importantly, don't want to take the ridiculously long time to learn how to use the damn thing!  

My biggest issue is getting in and out....  I can't afford to spend 3 hours shooting a home usually... most Realtors (at least around here!) won't pay for that...  There are exceptions of course.... I actually turned down a job about 2 hours from here because I didn't want to waste 4 hours in the car to shoot one property...  and the guy begged me... so I quoted him a price over 6 times my normal rate.. and he paid!  Had another last week with a 15,000 sq ft. Newport Mansion who also paid about 6 times my rate...   Those special types of properties obviously allow me to spend much more time, and haul around much more equipment, etc. and of course they're way more fun to shoot than the plastic Colonials I'm usually shooting... But I'm getting paid for spending extra time.

For the 'bread and butter" shoots, which I do about 5-8+ every day, I can't be there more than 30-40 minutes... an hour-90 minutes if I'm also taking stills.  And of course, on a $200K-400K house, I'm not going to get $1500+ to shoot it!

And honestly, I've been doing this for 6 years, and I really have no competition at all.  For most Realtors, I think what's MOST important is 1) Price  2) Turnaround time.  

If you can show up when THEY want, and turn it around when THEY want (usually the next day), you're a hero and you've got a loyal following.  And the unfortunate reality is that 99% of your customers don't know or care about your equipment, whether you're using jibs, cranes, dollys, etc.  They can't tell the difference (hell most can't tell the difference between professional still photography and cell phone photos either!)

They want it to look good, sell the house, sell themselves, be priced affordably and be done on time. 

And THAT'S the killer in this business.  It's a ball breaker.  

Thanks for the reply, Fred.  All I can say is that, at this point, in my market, my experience has differed quite a bit from yours, but I find your experience absolutely fascinating and helpful.  I've been thinking about this today, and my preliminary thoughts are that I may go for branding my firm as the Mercedes of real estate video, then (once I've achieved that) offer Chrysler, Plymouth, and Dodge brands for the more down and dirty shoots to expand my business, hiring others to do the less demanding work.  Your method has a lot of merit, primarily because it requires so little editing, and I may well adopt something similar for the low-end stuff.

As for the steadicam, I assume you're using a Merlin or something simliar with your DSLR?  I saw a couple of your shots that were faux jib shots that I assume you achieved by holding the hand-held steadicam over your head.  I have a vest-articulating arm-sled stabilizer that weighs about 50 lbs with the camera on it, but that seems like a bit of overkill, and I hate wearing and balancing the thing, so I haven't used it for real estate.

I've also been looking into whether or not colorists can substantially improve the shots without the necessity of lighting.  A good deal of my time is spent manipulating lights, and if I can eliminate that time by paying someone to artificially maniplate light in post, it might be worth it.  Ever give that any thought?

 Oh, to elaborate a bit, Fred, one of the things I haven't found to be true in my market is that, while I agree that realtors don't care about your equipment, they really can tell the difference between quality photos/video and not-so-good quality.  Don't know WHY our experience of that is different, but it certainly has been, so far, for me.  Now, as more and more realtors begin to use video, I expect the quality of my clients to decrease, and what you say might very well be true at that point.  I'll just have to see.

Thanks for the conversation.  I find it very enlightening.

 Yeah, I use the Merlin.  I have the vest... brand new... never used it once.  Hate it.  I need to sell it...

No, I haven't given any thought to any of that...  it's just way overkill at least for my business.  These people don't CARE about any of that stuff...  literally, not one person would ever know the difference.  

I think real estate is very different from many other industries, where all of that stuff (can) matter and (will) be built into a price that is very acceptable to that market.  But in real estate, with very few exceptions, I just don't think they care one bit about any of that stuff.  They can't see the difference, can't tell the difference and certainly don't want to pay for something that means nothing to them!

I think, at least over time, there may be a market for that "Meredes of real estate video" that can actually support someone making a decent living, but I don't think it's here yet - at least in my market. I do million dollar homes almost every single day, and multi million dollar homes every week... and I KNOW most of those people wouldn't pay a higher price for what I may perceive as a better quality video.  Hell, I've had people bicker over $500 for a $10M property!    So right now, I'd rather do 50-60 shoots a month at $500 a pop than 2 @$1000, which is probaby all I would get.  Although I would have more free time... LOL   I shot 25 homes last week - every one were $1.5M-$6M.  And I absolutely know they would not have paid a premium for any of those shoots.  They were more concerned with cramming as many shoots into a day (I did them all in 2 1/2 days) than anything else.  It was exhausting, but to them, getting them all done was far more important than anything else.  And of course they wanted them all finished by this weekend!  THAT'S what's important.  

But in time, at least around here there may be more of a market and demand for high production values and higher prices.  It's definitely not here now.  Even the very few competitors I have charge about $500-$600 for a video, and they do virtually no business at all.

Interested in all the comments.  Thanks for the stats Gary. 

Stuart, I seriously don't think the realtors here in SW Florida would consider the type of video shoots you do, although they must be amazingly beautiful. 

Fred and everyone else, we purchased a "STEDDIPOD" last year and love it.  It was quite easy to learn to use and our videographer uses it for many purposes, including parties and weddings.  The manufacturer is Barber Enterprises in CA.

Very slowly more Realtors are beginning to recognize the power of true full motion video.  We could not make a living on it, but it adds to the video business.

 Fred:  I sincerely, sincerely hope that you don't think I'm challenging you or your expertise.  Far from it.  You have clearly, clearly found a business model that works, and that's a remarkable and good thing, indeed.  My maunderings are simply sort of a means of thinking out loud, in a sense, and of stressing my ideas by running them by someone who has been doing this for a while, now.

It might be helpful to tell you my experience, so far.  About four months ago, I had the idea that real estate video, good video, might sell, so I sat down with someone from Keller Williams and talked it over.  She referred someone else to me, and some time later, he hired me to do a video.  Since then, I have done absolutely no marketing, whatsoever.  I don't even have cards or a website related to this business segment.  i don't even CALL my current clients to try to drum up more business.  Still, my phone has been ringing.  A lot.  It's all word of mouth.  I can't even keep up with the demand, given the other video segments in which I operate.  A fair proportion of these real estate jobs have paid four figures (I charge a percentage of the asking price for the home), which isn't as much as I earn from corporate video, but then it's not as hard, either.  I heard from a third party, recently, that my name had been bandied about at a country club pool because one of my videos had sold a $1.7 million house in a week.  I doubt that's true.  Dumb luck undoubtedly played a role, but within a day, I got a call from someone who had seen that video who wanted another just like it.

So, I freely and humbly admit that my experience is not nearly as deep as yours, but all the indicators, so far, are that my market, at least, will support the kind of video I do at the kinds of prices I need to have to make them worthwhile for me.  Heaven knows what will happen when I start to market, which I will do beginning in August, probably.  I'm certainly prepared to add staff quickly, if need be.

BTW, I have a hypothesis that your market might not support what I do, if only because you seem to dominate it and have the relationships.  It's much harder to upsell against an entrenched competitor than it is to start from scratch in a market where there is no dominant competitor.  If I were to start up in your market, I'd probably try to figure out a way to do it faster and cheaper, and that would be very hard, so I might not bother.  So, since realtors in my market aren't used to a particular brand, style, and price for video, it could be that I can stake out the high ground, then offer Dodge/Chevy video for those who don't want the high end stuff.  That's my thinking at the moment, anyway.  If I'm wrong, I'll change strategies to be more like yours.  If I'm so wrong that I can't get a decent return on investment, I'll just expand my corporate business and abandon real estate, altogehter.

Once again, thank you for your insights.  I KNOW your approach will work.  I think I'll just play around with some other approaches, though, and see if I can't get paid for a value-added product with a value-added profit margin.  We'll see.

SWFL:  I have no idea if my videos are amazingly beautiful or not, but you're welcome to check them out, and I'd value any feedback you or anyone else might have for me.  My channel is:  http://www.wellcomemat.com/LumosProductions  Since I started out in marketing with a heavy emphasis on television advertising, I guess I kind of take that approach, putting the emotional appeal up front (wouldn't it be wonderful to live there?) and the tour aspects behind.  Like Fred, I figure one can get most of what one needs to see in a house from the photos, and the video is a follow on to "set the hook," so to speak.  I have only three uploads.  The first two are for very upscale houses, and I used a jib and track dolly.  The third is for a less-expensive condo, and I used only a camera, tripod, and wheelchair dolly (I had a wooden, plug in seat made for the wheelchair that will support my folded tripod).

 Are you charging a percentage of the asking price UP FRONT, or when/if the property sells?  

The biggest argument I get is that agents are hesitant to pony up any money up front, because they have no guarantee it will sell at all and then they're out those marketing costs (and that's an entirely different discussion...! LOL).  But if they only have to pay if the house sells, than that could pay off handsomely.  Of course, many houses don't sell and that would be a nightmare keeping track of all of that...

I would love to figure out a way to charge double and have half the work, that's for sure!  I'm working like crazy (and I do no marketing or advertising at all... my phone number is even unlisted).  Last year was my best year ever, and I've far exceeded last year's numbers already. I just am hesitant in this economy to push too hard with pricing, as I see others priced higher who are doing absolutely no business.  (which of course could have nothing to do with their pricing, but I'm guessing that's a part of it).

I'm fortunate to be in one of the most expensive (and probably one of the healthiest) real estate markets in the country (Boston), which definitely helps.  Real estate here is still pretty good - my clients are very, very busy. 

 I'll do it either way, Fred.  I'll charge up front with a discount, or only if the house sells for a healthy percentage more.   Of course, if I do charge only if the house sells, I require a contract for an agent's next 10 homes, and I ask to see the average selling price and closing rates of their last 30 homes.  I don't want agents hiring me if a home is grossly overpriced, figuring hiring me can't hurt ;-), I don't want to work with agents that specialize on the low end, and I don't want to work with agents that buy the business by floating unreasonable asking prices, thereby reducing their close rate.  I don't really have an issue with keeping track.  So far, I've just checked the listings every now and then to see what's under contract, what's closed, etc.  When it's closed, I send an invoice.  Now, if my volume increases substantially, I'll probably have to get more organized about that.

In the end, the math says I should make substantially more money by going with the contingency pricing (allowing for the present value of money and the like), so I'd prefer that, but there haven't been a whole lot of takers so far.  Realtors here can do the math, too, I guess. ;-)

Here's another business model that's working for a guy in Seattle.  He works only with the most elite agents, and won't even DO video for anyone else.  He does high end stuff, too.  Claims 10 houses or more per week, and employs at least five full-time employees.

Like you, I'm lucky in my market.  We never really had a housing bubble here, so while prices and demand are down somewhat, they haven't bottomed out as they have in many places.  But, you know, I'm not sure that matters all that much, because my sales pitch is, and will be for the immediate future, that superior, full-motion video provides high ROI to the realtor by greatly increasing the batting average for acquiring competitive listings.  The cost of the videos is more than covered by increased commissions.  " If you're not with me, you may sell against me ;-)."  I think that would work in pretty much any market with a savvy realtor or two.

And if you're that busy, you need to hire someone and use your free time to expand.  Leverage those employees for higher profits, dude!  Remember the old, Ferengi adage:  "Employees are rungs on the ladder of success.  Do not hesitate to step on them. *grin*

Our recent closing video had 2200+ wellcome mat views branded, and 440+ mls type views. Actually, a very poor video on a marginal property. But we sold it 4 times......loan issues made us start over. Lead, after lead, after lead...many have resulted in other sales. Video gets attention, and helps to create demand and interest.

Vacation properties are ideal for videos. We get call after call, and booking after booking directly from our video......we can hear the video playing in the backround as they book our cabin. I've never seen our stuff not dominating the first page of google for a local cabin rental search.

Stuart,  Beautiful video.  Your professional background certainly shows.  The market has been rough here in SW Florida for quite a few years but is beginning to pick up.  I've seen Realtors try to sell multi million dollar homes with a dozen photos or worse those weird 360s. 

I think it will probably be sometime before Realtors here are ready for high end productions.  Congrats on your great work.

 Thanks SWFL.  I hear you about about the housing market in Florida, but let me just throw something out there, OK?

To me, the issue with realtors and their incomes is simply this:  They have to attract buyers and sellers to get commissions.  It really doesn't matter about the market, except that down markets are even more competitive than rising ones, so it's even more imperative to market in such a way that you get more buyers and sellers.  In the end, though, EVERY market has some properties for sale and some buyers looking to buy. The issue for realtors is whether they can find a way to get a larger slice of a smaller pie.

And that's where we come in.

If you can find a way to help realtors make more money with your videos, then, to them, your videos go from being a cost to being a marketing investment that pays off.  If you can help your realtors get chances at more listings, close on more competitive listings than they are now, and atract more buyers because they've been seen and liked on video, then the cost of your videos becomes almost moot (to a point, of course).

I truly believe that the most likely thing that will happen to real estate video in the future is that it will become ubiquitous, and that all realtors will have to do it.  At that point, it becomes a cost of doing business, just like virtual tours are, today.  At this juncture, though, realtors can get a very REAL selling advantage by using video.  If you can sell that ... 

Thanks Stuart.  Do you mind if I use some of this on my FaceBook page?  I keep trying to find ways to educate the Realtors in our area.

https://www.facebook.com/sue.haberkorn?ref=profile and  https://www.facebook.com/sue.haberkorn?ref=profile#!/SWFLOnlineVideo

 Sure.  Help yourself, but if I were you, I'd sure use two of the stats on this page:

73% of homeowners are more likely to list with someone using video

.8% use video

If a realtor can't see opportunity there, she/he will probably never get it ;-).