Getting your real estate business noticed amongst the sea of other real estate enterprises with a strong SEO strategy is challenging.
While SEO is one of the most successful inbound marketing strategies, it requires continuous efforts and consistent learning of how the search algorithm works. It takes longer to show results.
For instance, if your SEO strategy takes at least 6-12 months to start showing results, it takes PPC only about 24 hours to begin making its mark.
In this guide, we’ll discuss the cost of real estate PPC in 2023, the average cost per lead, the cost of Google ads, factors that affect the pricing, and how much you should spend on PPC campaigns.
And how UpInFifty can help you with PPC marketing.
What is real estate PPC?
PPC, or pay-per-click, is an advertising model in which advertisers pay a fee each time their ad is clicked.
Let’s say you want to attract new customers or promote your property listings and need to organically get visitors to your website; you pay a certain amount to increase your visibility on search engines by advertising your offer.
Let’s take an example to understand PPC campaigns better.
Say, you are a real estate agent working in a competitive housing market. You have a new listing for a beautiful three-bedroom house in a desirable neighborhood. To attract potential buyers and generate leads, you launch a PPC campaign for Google (there are others, too – like social media PPC ads).
You define your target audience based on the location, demographics, etc., and create a compelling ad. Next, your research and select relevant keywords that potential buyers might use when searching for homes in your area. For example, “real estate agent in New Jersey” or “3 bedroom house for sale in New Jersey.”
To be at the top of the search results, you enter into an auction for the chosen keywords, indicating the maximum amount you’re willing to pay per click. The more competitive the keyword, the higher the cost-per-click (CPC) may be.
Each time someone clicks on your ad and goes to your website, you pay a certain charge based on your bid, quality score, ad rank, and others.
Why invest in PPC over SEO as a real estate marketing strategy?
One of the primary reasons is stiff competition from real estate giants like Realtor.com, Zillow, Trulia, Redfin, and others.
We entered the query “Buy home in New Jersey” on Google and let’s see what appeared at the top of organic search results.
It’s the real estate giants at the top of the list. In such a situation, by the time your SEO efforts start taking your rank up the search results organically, you can start driving traffic with the help of PPC campaigns.
How much does real estate PPC cost in 2023?
An average small to medium-sized company that wants to generate good quality leads from PPC advertising spends about $9,000-$10,000. However, it depends on your budget.
Let’s see a basic breakdown of the costs involved:
|Cost-per-click (CPC)||$2.59/ click|
|Cost-per-mille (CPM)||$3.12/ impressions|
|PPC Management: Tools||$15-$800/ month|
|PPC Management: Services||$350-$5000/ month or 12-30% of ad spend|
|PPC Management: Ad Spend||$300-$100 Million+/ month|
Want to compare the real estate PPC cost with SEO? Check out our guide on real estate SEO cost and get the complete cost breakdown.
What is the CPC for different PPC Channels?
Once you know about PPC, the most common question is: Where should I advertise, and what’s the cost-per-click for these channels?
There are a lot of channels where you can advertise, but the most popular ones are:
- Google Ads
- Microsoft Ads
- Facebook Ads
- Remarketing Ads
|Google Ads||$1-$2 or more|
|Google Display Network (GDN)||<$1|
|Google Search Network (GSN)||$1-$2|
What is the average cost per lead in real estate?
According to the FirstPageSage study, the average cost per lead in the real estate sector is $480.
As per the data provided by WordStream, the average cost per lead from Google Ads is $66.02.
Here’s how to calculate your average lead cost in your real estate business:
Total Marketing Cost / Number of Leads Generated = CPL
For example, if you spend $2000 on your ads and you generate 100 leads, your CPL is:
2000/100 = 20
Your cost per lead is $20.
How much does Google Ads cost in 2023?
On average, small-sized real estate businesses spend $1000-$2000 on Google Ads. Mid-sized real estate companies spend as much as $7000-$30,000 on Google Ads.
It’s important to know how much it would cost to opt for Google ads for your marketing strategy. Let’sLet’s see the average ad spend based on the real estate business size.
Real estate giants, like Zillow, spend millions. According to Adbeat, Zillow spent about $11.6 million in 6 months on Google ads.
But, what’s critical to note here is that it’s very difficult to give a specific figure since Google ad costs depend on a lot of factors like:
1. Industry competition
Certain legal and real estate industries are highly competitive with equally competitive keywords. It increases the CPC and hence your overall Google ad spend.
2. Market trend
You may incur increased costs in highly competitive real estate markets due to bidding wars for ad placements. Seasonal fluctuations, like peak buying or selling seasons, can also drive up costs as demand for advertising rises. Economic factors, such as market growth or downturns, can also influence ad spend.
3. Customer Lifecycle
Real estate requires people to make major decisions, and they won’t be buying with just a single visit to your website. Here, the customer lifecycle will require them to make multiple visits to your website before taking the final step, where you can see a conversion that pays off your ad spend.
4. Ad Management
One essential factor that affects the Google ad cost is – how well you manage your account. Posting an ad is followed by continuous optimization to see how well your ad performs.
You’re wasting your money if your ad isn’t bringing in new leads. If it’s performing well, you need to scale the ad to leverage it. You must maintain your keyword list and proper Google ad account structure.
How to calculate the conversion rate in a PPC campaign for the real estate industry?
In a PPC campaign, the conversion rate is the percentage of ad clicks that result in a desired action or conversion on your website or landing page.
This desired action can vary based on the goals of your campaign, such as making a purchase, filling out a form, inquiring about a listing, or leaving their contact information.
The formula to calculate the conversion rate is:
Conversion Rate = (Number of Conversions / Number of Clicks or impressions) x 100
For example, if your ad receives 500 clicks and generates 25 conversions, the conversion rate would be:
(Number of sale conversions/number of leads)*100 = (25 / 500) x 100 = 5%
A higher conversion rate indicates that a larger percentage of people who clicked on your ad completed the desired action, which is generally a positive outcome for your campaign.
A low conversion rate may indicate that your ad, landing page, or targeting needs improvement, and you may need to optimize your campaign to increase conversions.
The average conversion rate for real estate businesses is 1.7%.
Important: Your website design and UX play an important role in improving the conversion rate. Learn how much it cost to build a conversion-optimized real estate website.
What factors determine the cost per click?
Whenever someone comes across your ad when they search a query and click on it, the search engine or the platform you’ve used for advertising charges you a fee called cost-per-click.
The CPC rate depends on a lot of factors.
1. Advertiser Bid
The primary factor is your bidding value. Advertisers compete against each other to secure ad placements.
The higher your bid amount, the better your chance to have your ad displayed. Your CPC will be higher if the platform gives you a higher position in the search results.
2. Quality Score
Search engines and advertising platforms consider the quality and relevance of ads when determining their placement and CPC.
The quality score of your ad depends on the following:
- The click-through-rate
- Relevance of the keywords used and ad text
- Quality and relevance of your landing page
- Your Google Ad account performance
Here, the CTR is one of the most important parameters. When people who see your ad click on it, it strongly indicates to the search engine that it is relevant and provides value.
Your ad gets higher placement and is charged lower costs when you have a higher quality score.
1. Ad Rank
What if two ads have the same quality score?
In such a situation, you must pay a higher CPC to rank higher in ad placement. This increases your visibility and improves your chance of conversions.
2. Campaign Age
As your campaign runs longer, you can optimize and improve its quality score, decreasing costs.
For example, a newly launched campaign may have a higher CPC initially, but over time, as you gather data and refine targeting, the CPC may decrease.
3. Keyword Competition
Google Ads functions like an auction, where advertisers bid on keywords. When multiple advertisers bid for the same keyword, the competition increases, increasing the CPC.
For example, if you are in a highly competitive industry, the CPC for popular keywords may be higher due to increased bidding activity.
4. Website Quality
The amount of time visitors spend on your website, the bounce rate, and the loading time are all factors that signify the quality of your website.
High-quality landing pages relevant to your keywords can contribute to a higher quality score. This, in turn, can result in lower CPC rates.
If you have a well-designed landing page with engaging content and a clear call-to-action, search engines may view it as valuable to users, leading to a better quality score and potentially lower CPC.
Costs can vary based on your target location and whether you target buyers or sellers.
Suppose you are targeting a specific geographical region with a high demand for your products or services. In that case, the CPC may be higher due to increased competition from other advertisers targeting the same location.
The CPC may be lower if you target a less competitive or less populated area.
The type of audience you target, such as buyers or sellers, can affect the CPC rate. For example, if you are targeting buyers in a specific location, the CPC may be different compared to targeting sellers in the same location.
How much should I spend on PPC ads in real estate?
Even if you know all about real estate PPC advertising, determining your ad spend takes a lot of work.
How much of the advertising budget should I spend on PPC campaigns?
There are a few things you should know about before you can determine your budget:
- What is the overall ad budget, and how much will you spend on PPC?
- What is the current conversion rate, and how much do you want the value to increase?
- How many new leads do you need monthly to ensure a certain amount in sales?
- How much can you spend on a lead, that is, what should your CPL be?
Once these figures are clearer, we can determine the PPC budget.
Let’s say you aim to acquire 150 new clients in a month, and your close rate is 10%. To achieve this, you would require a monthly PPC lead goal of 1,500 conversions, considering that 10% of them would convert into 150 leads.
Assuming your cost per lead is $20, you would need a monthly budget of $30,000 to generate the desired number of leads and clients. This amounts to approximately $1,000 per day.
You will always have to account for variable factors like keyword competition, the maximum bid value, location, campaign, website quality, etc.
How does UpInFifty help you increase real estate conversion rates and lower your PPC cost?
Real estate agents, brokers, and companies often hesitate to hire a PPC management agency as that would increase the PPC budget.
But the advantages of hiring our services outweigh the cons of spending more on PPC management.
1. PPC Expertise at your service
Our marketing team at UpInFifty is an expert at designing PPC campaigns and excels at making the best of your budget. We experiment with strategies all the time, making sure that we apply only the ones that are sure to get you results.
We have designers and copywriters who know how to write click-able copies, include relevant keywords, and increase the rate of your conversions and, consequently, your sales.
Your landing page design and optimization will matter the most in improving your Google quality score. We structure your website design in a way that can generate more leads and improve the quality score.
2. We save you time and money
We know it sounds contradictory. How can we save you money when you have to spend money on paying us for PPC management?
Firstly, PPC requires you to monitor how the search engine algorithm works continuously. The UpInFifty team does that for you. We take the load off your shoulders and handle the extensive management.
Also, you need to monitor your ad’s performance and consistently optimize it to make it perform better. If you were to do that on your own, it would probably leave you no time to manage your real estate business.
You need to track and optimize ad performance to save money on ads that bring no leads and conversions.
We help you save money by making the most of your ad spend and ensuring you achieve your real estate goals. We help you save time so you can do what you do best – manage your real estate business.
Real estate is a competitive industry, and PPC advertising is complicated. People believe that PPC ads do not serve the purpose of increasing conversions and sales, and opting for that ad channel is like throwing money down the drain.
But that’s not the case. PPC ads help you put your business out in front of the world. And we help you do just that!
Contact us for a one-on-one session to understand how real estate PPC advertising can help you grow your business and how we can help you manage it better.
Aryan Chauhan is currently pursuing an MBA with a focus on HR and Marketing. With a strong background in web development from his undergraduate studies, he possesses a unique combination of technical expertise and business acumen. Currently, Aryan is working as a junior marketer and SEO specialist at UpInFifty, where he applies his skills to contribute to the company’s SEO and marketing growth and success.