After two full years of depressed home sales, the internal advertising pendulums have begun to swing for real estate. Agents, who initially tried to appease home sellers by advertising more on traditional channels, this year systematically cut their print budgets and pushed more money into the Web. The result has been a slingshot effect for online advertising. While total ad spending on real estate has declined 3 percent this year, spending on the online segment has grown 25.8%, hitting $2.6 billion. We are projecting online real estate advertising to grow at a somewhat slower rate next year – 12.4%, while total real estate advertising continues to compress. In three years, agents and brokers will be spending more ad dollars with online media than with the newspaper.

By 2012, Borrell’s numbers show real estate advertising online growing by 34% to $3.45 billion. Newspaper’s real estate take will fall 32% to $3.3 billion. And the rest of real estate advertising will grow 10% to $4.46 billion. All told, the five-year outlook for real estate advertising — regardless of the platform — is down 2%. Flat marketing budgets are never a a very bullish signal for any industry.

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