Get-Rich Offers Swell on Facebook
Monday, December 29, 2008
On Facebook, a target-rich environment of the young and potentially real estate-less, D.C. resident Omari West can't help but notice all the advertisements spinning the economy's nose dive into can't-miss opportunities.
"Foreclosed homes in DC," said one from the online firm ZipRealty. "Search through listings of distress sales in your area and find your gold mine today."
Countless others surface on young people's Facebook profile pages, importing recession anxieties into a domain otherwise dominated by humor, personal photographs and lists of favorite books.
Some appeal to vanity. With stick figure characters, a http:/
The right-hand side of Facebook profile pages are filled with rotating ads, tailored to the demographic, friends and interests of each member. Within the shuffle -- the "Oprah's Acai Berry Diet" ad seems to be ubiquitous -- are hip, cheeky and hucksterish pitches that, in keeping with Facebook's typically ironic or humorous culture, playfully tap into the nation's economic swoon.
Some Facebook users in their 20s and 30s say they ignore the pitches, while others scour them for deals. The Washington area, with a large number of recent college graduates who frequent the social networking site, is also a hotbed of foreclosures. As of Dec. 9, more than 30,000 properties in the area were in some foreclosure stage, according to experts at the Center for Regional Analysis at George Mason University.
West, 35, a business school applicant who barely escaped having his condominium foreclosed on a few months ago, likes clicking through ZipRealty's ads so he can scavenge for foreclosed homes. (A ZipRealty spokesman said that the company won't say how often the ads are clicked but that they perform well.)
"Some people find it carnivorous or predatory," West said. "They're like, 'I don't know how you can feed upon the distress of the market,' or 'You're going to buy a home in foreclosure? Aren't you capitalizing on another family's woes?' "
Amanda Creed Lockhart, 30, a senior director at a Rosslyn-based consulting firm, needs to unload her one-bedroom condominium in Cleveland Park, because she's moving to a four-bedroom home in the Chevy Chase neighborhood in the District. She dismissed the Facebook pitches in her house search, unwilling to encourage what she considered Orwellian tactics and thinking that the catchy ad copy meant scams.
"I thought it was kind of creepy," Lockhart said. "And the one I clicked on for the EOS apartments was almost like a Macy's coupon sale to buy a condominium. It's very different from how I've purchased housing in the past. I was concerned I'd be getting e-mails from a Congolese gentleman asking for money in his bank account."
The EOS twenty-one ads on Facebook send visitors to the property's Web site, where cutout coupons offering "FHA/VA NO MONEY DOWN FINANCING" are for the taking. But only military veterans, with the aid of the Department of Veterans Affairs, are entitled to buy homes without making a down payment. Other first-time buyers can get an EOS condominium with lending insured by the Federal Housing Administration with a 3 percent down payment.
Many real estate ads on Facebook are more colorful than the basic "1 Bed 1 Bath Condo" links on Craigslist or those featuring photos of posed real estate agents with their firms' logos on newspaper Web sites. Some ads sell trendy-looking space inside new apartment buildings; others offer access into an allegedly rare trove of "secret" listings that will, in the words of http:/
Blake Allison, president of Financial Education & Literacy Advisers in the District, said there's a reason many of the ads seem so unseemly. "These ads have a get-rich-quick feel, and it's the wrong message to send at the wrong time," he said. "The last thing we need to do is encourage people to put themselves at more risk."
(Okay, so some Facebook real estate ads are harmless, such as one from Depressing Times, a Web site that offers "Subprime Christmas Cards" for $3.99.)
For West, the ZipRealty Web site does offer something of a gold mine. He downloads the information onto an Excel spreadsheet. He looks for where prices are dropping the most and vacancies are rising.
West said the global economy's spiral, in a small way, can be viewed through his prism: His consulting business, which represents telecommunications clients expanding to Africa, started drying up in the summer. He took out more loans at higher interest rates on his one-bedroom condominium in the District to avoid foreclosure, before he finally sold it in September. West, who just began a job as a commercial banker, still sifts through home listings he finds through ads on Facebook and other sites. He views those ads as the one upbeat space in the economy.
"The notion that contraction automatically means something bad has to get out of our minds," West said. "For people positioned to buy, we can get a discount on properties that, quite frankly, are overvalued."
(In January, Donald E. Graham, chairman of the board and chief executive of The Washington Post Co., will join Facebook's board of directors.)
Lockhart, who works for the Corporate Executive Board, said the Facebook ads are sometimes too playful, given the amount of money at stake. Ads for some condominium buildings on Facebook "felt like they could have been [for] a nightclub -- not like the logos of the typical real estate agency," she said. "This is one of the biggest purchases you make."
Lockhart and her husband searched more traditional-looking sites like Redfin and obtained listings from her mother, a Long & Foster real estate agent. They found a home in the District's Chevy Chase neighborhood, and now they need to sell their Cleveland Park condominium.
For that, Lockhart couldn't resist crafting a listing on, of all places, Facebook. Under the Web site's "Marketplace" section, she ginned up a promotion to compete with the Mad Men behind the ZipRealty "gold mine" pitch.
Her ad: "$379,000 -- Condo for Sale: Crate & Barrel Style Gem in McLean Gardens."