In an exclusive survey conducted with Classified Intelligence, LLC Realty Times readers made three startling declarations -- they're spending more, not less, money on advertising, they don't like the results they get from the Internet, and they say that print advertising is dead.

Their dilemma is that they have to try new things yet hang on to outdated advertising mediums. For example, Realtors say print advertising is overpriced and ineffective, yet many report that sellers still demand to see local newspaper ads for their homes.

While only 15 percent of the survey's 344 respondents said they still advertise in print, Realty Times readers voted newspapers third out of eleven categories for producing qualified leads.

Why the disconnect? The Internet isn't doing the job. Over half our respondents said they aren't getting enough leads online.

One hurdle is the sheer number of advertising choices that are available. The local newspaper was once the obvious choice for real estate advertising, but one-dimensional, pay-by-the-inch ads pale in comparison to the robust video and information-rich Internet.

But Internet advertising is so broad, that thirty-nine percent of Realtor respondents said they were simply overwhelmed by the options. Only 5 percent said they were highly confident of how they allocate their spending, online and off.

Now, Realtors report that word-of-mouth is still their greatest source of leads, followed by signs and billboards. Notes Sue Stenberg, author of the Realtor advertising survey, the results show an "overall lack of confidence in real estate advertising as a whole."

She says, "When you combine the relatively high effectiveness ranking of print with the fact that only 14 percent of total print users use it primarily because it is effective, the implication emerges that agents and brokers don't see advertising in general as a very effective marketing tool."

Realtors appear to be hedging their bets -- spreading no more than 10 percent of their advertising budget on any one type of advertising. They're trying new things like blogging (21 percent) and social networking (25 percent). They are trending to spend more advertising money on national sites, such as Move.com, but as yet, a clear market leader has yet to emerge.

Agents are still relying largely on the strength of their own websites and plan to spend the lion's share of their advertising budgets accordingly (17.2 percent.) Yet many expressed dissatisfaction with the quality of the leads they get. Only 11 percent reported results that exceeded their expectations, and 31 percent said they got what they expected, which leaves a whopping 58 percent unhappy.

Flyers, yard signs, and/or billboards (14.7 percent) are Realtors' second choice for where to spend their ad money, with Direct Marketing taking third (12.5 percent) place.

Print ads in local newspapers are fourth place at 11.2 percent.

The good news for ad vendors is that 47 percent of Realtors said they were increasing their advertising spending this year, but that's down from 58 percent when we did the survey last year. And the number spending less (27 percent) this year is up from 8 percent last year.

Free sites, blogs, and social networking sites that don't charge agents to participate may make it more difficult for newspapers and Internet companies to capture Realtor ad dollars.

As the housing market continues to change, it will be interesting to see where Realtors put their money.

Today, 80 percent of Realtors personally pay for at least half of their advertising dollars and 64 percent personally pay for at least 75 percent of their advertising spending. The majority of respondents reported that their individual, national or corporate offices each paid for less than 25 percent of their total advertising.

Published: October 24, 2007

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