Realogy Makes Bold Move to Counter Negative Media Spin

Says CEO Perriello: ‘Now is not the time to be quiet. Now is the time to be noisy.’
By: Maria Patterson: RISMedia
On October 5, Realogy took a strong stance against the barrage of negative press directed toward the real estate industry over the past several months. The Parsippany, New Jersey-based parent of such real estate brands as Century 21, Coldwell Banker, ERA and Sotheby’s, placed a full-page advertisement in USA Today to let consumers know that dropping mortgage rates and an increasing number of available properties make today the “perfect time” to purchase a home.

The Realogy ad ran in this past Friday’s main news section of USA Today, the section that receives the national newspaper’s highest readership.

The ad—whose headline read, “Opportunity is Knocking at Your Next Front Door”—was designed to let consumers know that rates for 30-year fixed mortgages have dropped in nine out of the last 10 weeks, potentially allowing home buyers to save more than $1,500 per year. Included in the ad were statistics from Realogy’s own home sales, including the fact that the company’s brands were involved in over 100,000 home sales in September—on average, one home sale every 30 seconds. The ad closed by encouraging consumers to contact a local real estate professional to learn more about “today’s home buying opportunities.”

Alex Perriello, president & CEO of the Realogy Franchise Group, directed an advance copy of the ad to the company’s franchise offices. In an accompanying letter, Perriello told Realogy brokers that, “Although the media has focused on the downside of the changing real estate market, there are also compelling messages about real estate that we need to reinforce to consumers,” such as the recent drop in mortgage rates.

In an exclusive interview with RISMedia Friday, Perriello explained that, “The unfortunate reality here is that good news seems to get buried in the newspapers and it's the negative headlines that get all the attention. What we're trying to do [with the ad] is motivate buyers with the facts. Mortgage interest rates have come down, there's an ample supply of inventory and homes are selling.”

“We wholeheartedly agree with the message of the Realogy ad,” says RISMedia CEO & Publisher John Featherston. “Today’s real estate market is full of opportunity for both consumers and real estate professionals, and it is our collective responsibility to disseminate the facts about the market in the face of negative media hype. We commend Realogy for taking a step that our entire industry will benefit from.”

According to Perriello, negative press surrounding the real estate industry is not a new occurrence. He recalls a “spirited debate” with Fortune magazine in 2002 whose October cover that year depicted a house on the edge of a cliff, accompanied by the headline “Are Real Estate Prices About to Fall?”

“When I look back four years later, if someone didn't buy a house in 2002, they missed out on four years of home price appreciation and what a sad commentary that is,” said Perriello. “The unfortunate reality is that bad news sells and that's what we're seeing right now.”

To combat negative press, Perriello believes that all real estate professionals need to take a very proactive position in the marketplace. “The industry needs to bridge the gap in every way possible,” he said. “Give consumers facts and figures in order to send them the message that houses are selling.”

Perriello also explained that it’s critical to infuse some historical perspective into the current marketplace. “When you look back and analyze the periods of time in the late ’70s and early ’80s, and then from 1990 to 1993 when there was a drop in housing, and you look at what precipitated all of that, the major contributing factors were high unemployment and interest rates that were 15% in the ’80s and over 10% in the early ’90s.”

Today, conversely, there is lots of good news, he says—including a dramatically growing population rate and still-low interest rates. As Perriello explained, “We just need to let buyers know.”

Perriello also emphasized the need for stepped-up communication with consumers. “You need to keep the seller informed right now,” he said. “There’s a disconnect between what a seller might think their house is worth and what the market is willing to pay. You have to give that seller continuous information. If you don’t have good news, sometimes you’re tempted not to call, but you need to keep people informed. This is the time you need to be out in front of consumers.”

“Now is not the time to be quiet,” Perriello added. “Now is the time to be noisy.”

In order to get positive information to consumers, Perriello expressed the need for brokers to become more involved as well. “Brokers need to share local market statistics with agents and make sure that the marketing and presentations agents are using are relevant in today’s market. This is the time when consumers need us the most.”

Perriello hopes that other real estate firms follow suit in Realogy’s efforts to counteract negative media coverage: “This is a multi-layered approach for us; we’re considering everything in the future from more ads to media interviews. We’re going to keep it going. And this is the one campaign that I hope all our competitors will pile on.”