The third quarter brought some interesting shifts in SEM performance for builders. While most metrics held steady compared to Q2, we’re seeing subtle changes that tell a bigger story: more competition, cautious buyers, and the growing impact of remarketing.
Our team at Do You Convert analyzed data from over 100 builders across the country to break down what’s really happening with paid search and social right now, and what to keep an eye on as we head into the end of the year.
Before diving into the numbers, it’s important to remember that each metric is influenced by numerous variables, from your market’s competitiveness to your home pricing strategy. That’s why we’ve provided ranges rather than fixed values. Whether you’re in a high-cost metro or a less saturated secondary market, understanding the why behind your numbers is just as critical as the what.
Google Search
CPC $1.28 - $2.50 (down 0.78%)
Average CPC is holding relatively stable compared to the 2nd quarter. We are still seeing higher CPCs compared to last year due to increased competition across the ad network. We are still seeing a high level of traffic to builder sites, but lower conversion rates are leading builders to spend more on Google Ads to reach their sales plan.
Google Search
CTR 6.9% - 11.6% (down 3%)
CTR for Google Search ads continues to trend downward slightly. This is likely caused by a number of factors:
- Builders are trying to fill in lead volume gaps using Google Ads by bidding on broader terms, which often come with a lower click through rate.
- As lead volume decreases, we’ve seen more builders experimenting with more automated bidding strategies and campaign types. These generally focus on conversions, in turn receiving higher CPC and lower CTRs.
- Google seems to be putting more weight on landing page relevancy over the past two months. Our team has been monitoring changes to ad rank, and less relevant landing pages are being penalized more than they previously had been.
Keep in mind, with Google Search ads, you only pay when someone clicks on your ad. So a lower CTR is not necessarily a bad thing as long as the clicks you do get are engaged with your site.
Google Display
CPC $0.07 - $0.30 (Down 19%)
Google Display CPC continues to be a very affordable way to build awareness and attention for builders, and the average cost per click is down 19% compared to last quarter. While display ads are not generally a driver of directly attributed conversions, we have been seeing many builders take advantage of these types of campaigns as they enter new markets or to help re-engage people who have previously visited their website.
Across the country, we are still seeing high levels of attention, but that is not necessarily causing a correlated increase in conversions. While people are interested in buying a new home, they are not in a position to commit, even to completing a lead form. This scenario makes remarketing campaigns more important than ever.
Credit: HomeBuilder Data
Google Display
CTR 3.3% - 7.3% (Up 26%)
As I mentioned in the previous section, the current market is leading builders to lean on Google Display for increased remarketing efforts. This shift to focus more on remarketing and reengagements versus brand awareness has caused a 26% increase in CTR. With ads being shown to people who have already explored the website, it is expected to have a higher click through rate on the ads.
In Q4, I would expect a slight dip in CTR on Display. Towards the end of the year, many builders run promotions or incentives. These campaigns generally have lower click volume compared to remarketing campaigns.
Meta Ads
CPC $0.15 - $0.72 (Even)
Meta cost per click has remained relatively stable compared to last quarter. This is a really positive sign, as we have been seeing more and more builders take advantage of remarketing ads on Meta. Historically, remarketing equaled a higher cost on this platform, but recently we’ve noted this is more on par with marketing to general audiences (provided your remarketing audience is large enough).
As we approach the Holidays, I do expect to see CPC increase on Meta. Unlike with Google Search, we are competing for attention with retail and e-commerce companies. As their budgets go up for Black Friday sales and Holiday promotions, our costs will temporarily rise.
Meta Ads
CTR 1.7% - 3.3% (Down 2%)
While we are seeing CPC remain steady, we do see a slight downtick in CTR. Many factors could cause this slight decrease: the current market conditions, ad copy chosen by builders, or a greater focus on struggling communities.
Overall, Q3 kept things pretty steady, but it’s clear the market isn’t standing still. Costs are leveling out, click trends are shifting, and remarketing is proving to be more valuable than ever. As we move into Q4, expect a few seasonal bumps—especially with holiday ad competition—but also plenty of opportunities to fine-tune your strategy. The key is staying flexible and focused on the quality of your traffic, not just the volume. We’ll keep watching the trends so you can keep building smarter.
