Videos Increase Exposure To Possible Homebuyers
Borrowers, including first-time homebuyers, scattered across the country are surfing the Web to find deals on the latest foreclosed properties.
A new video service is allowing lenders and servicers to showcase their REO inventory online. REO-TV, developed by Malibu, Calif.-based Central Mortgage Asset Management, is being used as a new type of marketing tool, allowing possible buyers to take “virtual tours” of dozens of properties in less time than it would take to schedule an appointment and view just one property in person.
This optimizes the efficiency of both listing agent and purchaser, and can streamline the marketing and sales process by reducing a property’s time on market, according to Philip Wegener, president of Central Mortgage/REO-TV.
“Videos include detailed interior and exterior images along with street scenes and neighborhood highlights, for the cost of a standard drive-by property inspection,” he told Managing REO.
“Video ‘virtual tours’ provide a much better overall ‘feel’ for a property than still images, and the narration provided by the listing agent can highlight and emphasize critical factors that may be lost in long-written status reports.”
According to Wegener, this is “a new paradigm” and a new tool for marketing REOs.
“Since February 2009, we’ve done extensive testing and gotten wonderful response back from the major lenders including Bank of America and Wells Fargo. Fannie Mae and Freddie Mac are very enthusiastic about this.”
Local, experienced brokers narrate video for all types of bank-owned real estate. The videos are geared towards giving asset managers a “you are there” experience.
“It’s the next best thing to the asset manager actually being at the property and physically seeing it in-person, which of course is impossible,” he told M-REO.
“There’s no way that the asset manager can possibly see every REO property in the caseloads that they are handling. REO volume has exploded. Asset managers are overwhelmed with the large volume of properties they are dealing with today.”
He said lenders are looking for innovative tools to improve the process and expose more properties to people, improve price settings between listing agents and asset managers, and move the homes more quickly to cut down on market time.
According to Wegener, video has the potential to “greatly improve communication” between listing agents in the local area and asset managers.
Up until now, local agents have been providing lots of still photos along with written reports trying to convey the condition and context of the property. Most agent or lender websites showcase tiny, thumbnail photos of the bank-owned property from the exterior along with a brief description of bathroom count, bedroom count and square footage.
“The REO-TV video in three to five minutes provides a more comprehensive view not only of the property but the neighborhood it is in and proximity to things like freeways or heavily trafficked streets. The REO video will allow the broker to narrate as they show moving images of the property and the neighborhood,” he said.
Often in today’s market, listing agents suggest the REO list price but it’s the lender or servicer who ends up setting it. That means they get into a situation where the lender is often “chasing down” the market values, responding to requests from local agents to reduce the price of the asset.
“Usually by the time they do that, the market has dropped further and the lender is behind the curve in setting the optimal list price,” Wegener added.
“As a result of the videos, asset managers and agents come to an optimal list price more quickly because the asset manger will have a better feel for what the property is worth. If a picture is worth a thousand words, we like to say, than a video is worth a thousand pictures.”
Lenders can post the videos on their own REO websites and listing brokers can use these videos to prescreen prospective buyers and eliminate certain showings. Central Mortgage Asset Management can customize the interface to include information links or any other interactive support, including financials about the property. All of this is viewable with another window click.
Unlike some inferior YouTube-type videos that take forever to load, REO-TV videos load instantly and are accessed by a secure screen coding, according to Mark Garcia, executive vice president, client service and technology for REO-TV.
“This technology didn’t exist as recently as two or three years ago. You would go to a company’s website and look at a video and it took several minutes to load,” Garcia said.
“If you look at what’s going on with media in 2010 and 2011, there’s been and will continue to be an explosion of use of video across all products and business sectors, and what is available in terms of digital video online. We’re going to see a 500% rate of growth in 2011-2012 advertising. The language of the Internet is now becoming video rather than static images.”