When it comes to real estate advertising, it can be difficult to determine whether your campaigns are hitting the mark. You may find yourself wondering: What’s a good conversion rate for a real estate ad? What’s a good click-through rate on Facebook? Only when you can take a deep dive into your marketing analytics and tie that together with your leads, closed sales, and new clients can you truly understand how your real estate agent ads are moving the needle.

real estate advertising benchmarks - localiq feature

What you want your real estate ads to lead to.

At LOCALiQ, we have access to tons of data about local businesses in different verticals and can mine this data to not only help our amazing clients see better results but to help you understand how your advertising campaigns stand in comparison. So to give you a little insight into how real estate ads typically perform, we’ve dug into our proprietary data from the last year and created some benchmarks to help you measure your real estate advertising.

We’re sharing the details with you broken down by the top real estate subcategories:

  • Apartments and rentals
  • Homes for sale by agent
  • Real estate broker
  • Residential real estate agent

You’ll get the details on:

  • Average click-through rate (CTR)
  • Average cost per lead
  • Average conversion rate
  • Average monthly spend

And, we’re sharing these average metrics across:

  • Search advertising
  • Display advertising
  • Social media advertising, including Facebook and Instagram ads

Check out this real estate advertising data below and get actionable ideas to improve your performance in each area.

 

Real estate advertising benchmarks: search marketing

real estate advertising benchmarks 2021 - search

Subcategory Average Cost Per Lead Average Click-Through Rate Average Cost Per Click Average Cost Per Call Average Monthly Spend
Apartments and Rentals $35.52 7.45% $1.43 $40.04 $1,500
Homes for Sale (Agent) $96.54 6.42% $1.39 $116.75 $1,750
Real Estate Broker $64.07 6.78% $1.68 $93.69 $1,000
Real Estate Agent (Residential) $75.94 7.39% $1.17 $98.49 $1,212

When it comes to real estate advertising on search engines, you know that it can often take a higher budget to get good results. Real estate has a longer buying cycle and is obviously an investment, so it makes sense that you’re going to be spending more than a business that provides less expensive—and less personal—products and solutions.

According to our data, the average cost per lead for real estate advertising on search engines is less than $100 per lead across all subcategories—now, that’s not just for a click. That’s for an ad click that led a searcher to contact the agent from their pay per click (PPC) ad. And, for apartments and rentals, that figure is even lower at just $35.52 per lead.

Another interesting piece of data to note is that the average click-through rate for real estate PPC ads ranges from 6.42% to 7.45% across the subcategories we measured. If you compare that to available industry benchmarks across all business types of 3.17%, you can see it’s much higher, which means people are engaging with these real estate agency ads at a higher rate.

We also found that the average cost per click for real estate advertising for our clients is less than $1.70. To compare, the industry average cost per click for real estate is $2.37.

Real estate advertising ideas for better PPC performance

How can you improve your CTR, conversion rate, and cost per lead for your real estate agency? Here are some ideas to test.

A/B test your PPC ads

A/B testing is always a good idea when running online advertising because it can help you determine how searchers are responding (or not responding) to certain aspects of your ads.

improve real estate ppc ads - ab test ads

By making simple tweaks to your ad copy, keywords, or bid strategy, you can improve the CTR for your real estate advertising on search engines and get more people to visit your landing page (and hopefully convert).

Refine your landing page

If you’re finding that your conversion rate isn’t where you’d like it to be, you might take another look at your landing page. Make sure that your landing page is optimized for conversions, meaning it has a clear call to action on the page that drives users to take an action such as leaving their contact information or contacting you directly.

improve real estate ppc ads - create a high-converting landing page

This landing page has a CTA for visitors to find their community.

High-converting landing pages also should relate closely to your ad copy. If your PPC ad highlights new home sales in Denver, your landing page should include relevant content and a contact form to “tour new homes in Denver.”

Run Local Services Ads

Real estate agents have access to Google Local Services Ads, which are a subset of Google Ads that allow users to contact a real estate agent or book an appointment directly from Google Ads without ever leaving the search engine.

local ppc - what are google local services ads

Running Local Services Ads for your real estate business can help you increase the leads you’re seeing from search advertising.

 

Real estate advertising benchmarks: display

real estate advertising benchmarks 2021 - display

Subcategory Average Cost Per Lead Average Click-Through Rate Average Cost Per Click Average Cost Per Call Average Monthly Spend
Apartments and Rentals $70.11 0.13% $4.66 $70.11 $500
Homes for Sale (Agent) $116.75 0.15% $4.18 $116.75 $1,000
Real Estate Broker $93.69

 

0.12%

 

$5.81

 

$93.69

 

$500
Real Estate Agent (Residential) $84.77 0.13%

 

$5.05

 

$87.36

 

$500

 

We know that a person has to see information about a business seven to 10 times before taking an action, and display advertising is a helpful way to get those touchpoints in while people are spending time online.

With display advertising, your real estate agency can show ads on sites across the web, like local news sites, review sites, and while online shopping, which increases the likelihood of them doing a search for your business, clicking your ad, or recalling your agency when it’s time to find a real estate agent.

Because display advertising is a more top-of-funnel marketing strategy, it typically doesn’t have the highest conversion rates or click-through rates, however, most of our real estate clients are spending less per month on display advertising than on their PPC or social advertising campaigns.

And while cost per lead for display is higher than cost per lead for PPC, one of the benefits of display advertising is that running display ads can actually improve your PPC results. Studies have shown that nearly 30% of people conduct a search after seeing a display ad, and there’s a 59% lift in conversions when this type of search is performed. This is why the lion’s share of most ad budgets goes to PPC—because it converts at a higher rate and lower cost. But it’s still a smart idea to allot some of your budget to display ads for brand building and brand awareness!

Ideas for better real estate display advertising performance

If you’re looking to improve your real estate display advertising campaigns, use these simple tips to get started.

Run display ads on a wider network

Most real estate agents run display ads on the Google Display Network (GDN) only. While the GDN encompasses a lot of sites, you’re still missing out on a big market. By running display ads on various networks, you can reach an even wider audience and improve awareness for your business online.

improve real estate display ad - run on a wide network

Use remarketing

Remarketing is a type of display advertising that allows you to target users who have previously searched for your business or visited your website. By remarketing to those who are already familiar with your real estate agency, you can increase the chances of them clicking your ad and converting to a client.

PPC + Retargeting - how they work together to convert more customers.

This can improve both your CTR and your conversion rate for your display advertising.

Promote an offer with your display ad

If you’re trying to improve your CTR for your display ads, you might want to try promoting a special offer like a free consultation, complimentary photos for listings, or a special signing offer. People are more apt to click on an ad with a compelling offer and a strong call to action.

 

Real estate advertising benchmarks: social media

real estate advertising benchmarks 2021 - social

Subcategory Average Cost Per Lead Average Click-Through Rate Average Cost Per Click Average Cost Per Call Average Monthly Spend
Apartments and Rentals $46.53 3.44% $0.53 $70.11 $300
Homes for Sale (Agent) $58.56 3.02% $0.69 $116.75 $750
Real Estate Broker $77.48 2.01% $0.61 $116.75 $750
Real Estate Agent (Residential) $46.53 2.03% $0.82 $116.75 $750

Did you know that nearly half of realtors say that social media results in their highest quality leads? Plus, 77% of real estate agents use social media as part of their marketing in some shape in form.

Want to know what types of results you might expect from social media advertising for your real estate business? We found that the average CTR for real estate agents running social media advertising with us on Facebook, Instagram, LinkedIn, and YouTube ranges from over 2% to 3.44%, an improvement compared to the industry average click-through rate for real estate at 0.99%.

Additionally, social media advertising has a promising cost per lead at under $50 for both apartments and rentals and residential real estate agents with just $300 and $750 monthly spend respectively. The other subcategories also see a fairly low cost per lead at under $60 for homes for sale by agents and under $80 for real estate brokers.

Ideas for better real estate social media advertising performance

Social media advertising can help your business sign new clients and sell homes—you just need the right strategy in place. Use these tips to improve your real estate Facebook ads and other social media ads.

Target the right audience

Like PPC advertising, social media advertising allows you to take advantage of advanced targeting options. You can target users in unique ways that may help you reach the right people.

facebook lead ads - demographic targeting options

If you already know your target audience, you can start there, but you can also look at targeting by life event, interests, home type, and more so that you’re covering all the bases when it comes to someone looking to buy, sell, or rent a new home.

Use eye-catching images (or videos!)

Social media advertising is very visual—you want to stand out in your audience’s feed! Lucky for you, real estate advertising is a perfect match for this medium because it’s all about selling someone’s dream home.

improve real estate social media ads - ad creative and photos

Make sure to include professional images as part of your Facebook ads, and play around with carousel ads or video in your real estate Facebook ads so you can really grab peoples’ attention!

Try Facebook lead ads

If you’re trying to increase your conversion rate from your real estate Facebook ads, try lead ads. Facebook lead ads allow you to capture lead information from a form directly through Facebook and auto-populates some of the information in the form with the user’s pre-provided contact info. This drives conversions and makes them easier for the person submitting their information.

improve real estate social ads - lead ads

Source

Run Facebook ads featuring testimonials

Real estate is a big investment, and people want to work with a realtor they trust. Start building that trust by running Facebook ads featuring testimonials from your happy clients. You can also incorporate some of your positive reviews into your ad copy.

improve real estate social ads - include testimonials or reviews

By sharing these positive experiences through an ad, you’re building social proof for your agency and helping to create an important emotional connection with your prospective clients or buyers.

Make sure to take advantage of Instagram ads

Because real estate is so visual, running ads on Instagram is another great opportunity for your agency. Use video ads, carousel ads, and advanced targeting on Instagram to appeal to a local audience looking for your services or to buy homes in your area.

 

Make your real estate advertising a success

By understanding the average click-through rate, conversion rate, and cost per lead for your real estate advertising efforts, you can benchmark your results and implement some simple optimizations to improve your advertising, increase awareness for your real estate agency, and reach your marketing goals.

 

Data sources

This report is based on a sample of 2,690 North American-based LOCALiQ client accounts in the real estate vertical who were running search advertising, display advertising, and/or social media advertising between March 1, 2020, and April 25, 2021. Each subcategory includes at minimum 10 unique active clients. “Averages” are technically median figures to account for outliers. All currency values are posted in USD.

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