House Ads: Paying Off Your Mortgage Through Advertising?

house ads

For anyone struggling to make their mortgage payment or whose house is currently upside down, the offer of someone paying your mortgage payments would seem like a dream come true. That is what an advertising company, Brainiacs From Mars, says it plans to do. They recently signed a deal with one homeowner to cover their home mortgage payment of $2000 for three months, and possibly up to a year. Before you get your hopes up that this is a solution to your current mortgage problems, it’s important to take a realistic view of what this offer is — nothing more than a publicity stunt. How do we know this? Because it doesn’t make financial sense.

This concept reminds me of car wrap advertising on a larger scale with fewer positives. During the dotcom bubble when advertising space was scarce and there was still high demand by advertisers, car wrap advertising became a popular way for companies to get their names out. The cars were basically wrapped in a company’s logo and the owner of the car could get paid several hundred dollars a month (and in some cases a free car to drive). As soon as the dotcom bubble burst, however, the demand for car wrap advertising disappeared to the point where it is now basically a small niche market where people can expect to get paid a small denomination gift card a month if they are even fortunate enough to find a company that doesn’t already have thousands of people in line to do this.

The problem is that house advertising for those who hope to get paid enough to cover their mortgage payments has many of the same problems that car wrap advertising has, plus some additional ones. Here are a few reasons why this concept is bound to fail as advertised, although it may become a niche advertising area where home owners will be paid much less than their actual mortgage payment:

Why Pay Someone Else’s Mortgage?

Think about it just a little bit and it quickly becomes apparent that paying off someone’s mortgage for advertising space on their house doesn’t make any financial sense. Why wouldn’t the company simply buy the house and make the mortgage payments themselves? This would give them complete control of the house plus they could rent it out to drastically reduce their costs. The simple fact is that if this type of advertising ever did become popular, the prices that the advertising companies would be willing to pay would be far below the full mortgage payment.

Houses Are Located in the Wrong Place

Where do you see billboard advertising signs? If you said, “not in the suburbs” you would be absolutely correct. Billboards are along high traffic roads so that as many people as possible will see them. A house that is covered in advertising in the suburbs is practically worthless because so few people will see each day, and those that do are probably the same people day after day. If your house was along a very busy street or a highway there may be a chance that this would work, but who wants to live with all the noise and pollution that comes with living next to a busy street?

Too Many People Interested

The fact that nearly 40,000 people applied for getting the single house advertising spot available shows that there are far more people that want to do this than there is ever hope of finding advertisers to fulfill the supply. The company says it plans to put house ads on 100 homes with the hope of one day covering 1000 homes in advertising. Even with their most hopeful projections, they already have far more people than they will ever need. This means that they will only pick the homes that best suit their objective leaving the vast majority of people without a chance of ever having this opportunity. This also means that the price that the advertising company needs to pay homeowners to do this will be a fraction of what the actual mortgage payment would be due to supply and demand.

Glut of Advertising Space

The only reason car wraps had a time of success was due to the extreme lack of advertising space at the time. That is not the case today. Why would advertisers choose an advertising medium that provides them less bang for their buck than traditional advertising avenues that are already our there? The only reason is that it would be a novelty and gain media attention — something that will quickly wear off once a few of these have been created. There really isn’t a path to bring this advertising medium beyond novelty advertising.

Problem of Backlash

While the homeowner that gets their mortgage paid may be happy with the advertising all over their house, chances are that all the surrounding neighbors aren’t going to feel the same way. In fact, the house could very well devalue the surrounding houses (who wants to live next to a huge advertisement?) causing a lot of negative reaction. While some celebrities may want any type of publicity they can get, most companies would rather avoid negative advertising at all cost. The potential for a lot of bad publicity will greatly limit the number of advertisers that would be willing to do this type of advertising.

What Will Likely Happen

What you can expect to see is a lot of scams around this concept pop up much like they did around car wrap advertising. What the house advertising scams will do is claim to offer an insiders track to getting advertising on your house (for a price) or a list of companies that offer this type of advertising (which is useless). This is how many of the paid to drive scams look today, and with so many people desperate to find a way to help lower their mortgage payments, they are prime targets for these scams.

Even with all the above warnings, those that want to apply to have their house turned into a billboard can apply here.

(Photo courtesy of Brainiacs From Mars)

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18 Responses to House Ads: Paying Off Your Mortgage Through Advertising?

  1. trish says:

    I am happy that this won’t be a new way for people to pay off their mortgage. I would hate to live in a neighborhood where all the houses were decorated in advertising. It would be an ugly mess!!

  2. Pingback: Carnival of Personal Finance # 349 | Sustainable Personal Finance

  3. Oswaldo Briones says:

    Please send more information about this program

  4. Lesley Jenkins says:

    Its ashame that this is what we have come to that this is even a thought but if they have a contract let me read then where do I sign?

  5. Michael David Cilantro says:

    I think it would not bother me at all.Thats like saying you would not live in a neighbor hood because a guy painted his house pink and put a unicorn in his yard.It should solely be up to the property owner and should never matter what others think.I just see why this would not be a good advertising venture but I do see potential and there could be a better way in which this would work.

  6. Rene Hartono says:

    I’d love to get more info on their program. Does anyone know if they pay the whole monthly mortgage payment or only a portion of it. I suppose that I need to find out the restriction/policies in my neighborhood even though its not part of a HOA. The city probably has some guidelines or ordinances regarding homes painted completely advertising someones brand.

  7. David Ren says:

    I own a marketing agency. Free Advertising that caused a stir during the housing crisis. Who’s next. Whats next. Only time will tell.

  8. Megan Ancheta says:

    If it helps the foreclosure crisis and the economy I’m all for it. How do I apply?

  9. Mary Cohen says:

    I’m glad a company’s out there thats trying to help us get out of this foreclosure crisis! This is such a great idea! Awesome!!

  10. Lisa Flores says:

    I’d do anything to keep the roof above our heads for my family. Looks like a small trade for a big reward to me. I’d sign up for this in a heartbeat.

  11. Ken Vieja says:

    Their company was recognized nationally. They really did hit the jackpot with free publicity though this campaign.

  12. Stacy Rivera says:

    I remember seeing about this on TV. Looks like a win-win situation for all parties here. I’m definitely 100% for it. Great marketing campaign!

  13. Mike Munoz says:

    Sounds like a crazy idea, but oh so clever. Never heard of anything like it before, but I love it. Kudos. I hope this idea goes through the roof and they save thousands of homes.

  14. Erica Leyva says:

    Everyone wins here… I love it!

  15. Tyler Jacobs says:

    I remember seeing this on the news and TV too. They generated quite a buzz nationally. Seemed like everyone was talking about them. Great marketing campaign!

  16. Sydney James says:

    This was a great idea and sign of the times. I would want them to promote my company. Were these the guys behind that HUVr hoverboad viral video? Wouldn’t surprise me.

  17. Lester Miles says:

    Even though home values have rebounded, there are still many families struggling to find work and pay their mortgages. All the manufacturing and IT jobs have gone to India and China and innovation is all we have left.

  18. Leslie White says:

    With all the publicity this got back in the day, I wouldn’t be surprised if they are truly behind many of the guerrilla type marketing campaigns we see today.

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