Hamilton Herald Masthead


Front Page - Friday, August 26, 2022

On your Marks, get set, go to war

‘Local Mark’ Hite fights back against Spain’s marketing armada

Air superiority is the most important factor in deciding the outcome of a modern conventional war, reads an article in Air Force Magazine. Sensing this, Realtors in Chattanooga took notice when billboards featuring Atlanta-based Realtor Mark Spain began to appear in the air above the Scenic City’s major thoroughfares in the spring of this year.

It soon seemed as though a motorist couldn’t travel a Chattanooga mile without seeing Spain’s face on a billboard. Clearly, the out-of-town agent wanted to be front-of-mind with local residents who were in the market to buy or sell a home.

Spain’s billboards sported a direct message, and it wasn’t “Now doing business in Chattanooga,” or, “I have arrived.” Rather, in a market that still lacked the inventory needed to meet the demand, Spain was appealing to homeowners who might want a quick way out.

“Get a guaranteed offer on your home,” his billboards declared. It was simple, succinct and designed to disrupt Chattanooga’s real estate market.

Spain’s tactic was not lost on the more than 1,400 local Realtors who were already serving Chattanooga and its surrounding communities. Many of them had been representing buyers and sellers in home sales for at least a few years, if not a few decades, and believed their knowledge of the city would give them an edge over the ubiquitous newcomer.

One local Realtor likely felt Spain’s arrival more acutely than the rest: Mark Hite of the Mark Hite Team at Real Estate Partners.

Not only did Hite have air superiority over Chattanooga before Spain’s arrival, Spain’s prominently displayed first name was causing confusion about which Mark was local.

Armed with a monthly marketing budget of $54,000, Hite had the resources to clear away the uncertainty. Part of this effort involved rewriting the messages he was communicating through his billboards and his print, radio, television and online ads.

First, he changed his name from “Mark Hite” to “Local Mark” – a designation he featured in large, bright letters at the top of his billboards. And second, he declared his ability to make a guaranteed offer on a home.

“With the confusion in May over the two Marks, we began converting all our media to ‘Local Mark’s guaranteed cash offer,’” Hite says.

Although Spain beat Hite to the market with a cash offer program, Hite says he and Spain technically offer the same service. Both were working for Keller Williams when co-founder Gary Keller began discussing his idea for a guaranteed-cash-offer program several years ago – Hite was in Chattanooga and Spain was in Atlanta – and their programs each appear to be modeled after Keller’s idea.

Hite, for example, says he makes his cash offer after personally inspecting a house. During his assessment, he calculates the amount of money he’ll need to spend on repairs and renovations to prepare the dwelling for market. His cash offer then comes with the promise of no more inspections and no strings attached.

Hite also tells the homeowner the amount for which he will list the residence if they decline his offer and choose to list the house with him.

“I want a homeowner to have all the information they need up front and to be under no obligation as they consider my offer,” Hite says.

While a homeowner will walk away with less money when accepting a cash offer from Hite or Spain, there are benefits, Hite says. For example, a cash offer allows a seller to sidestep the market and the stress sometimes involved in listing a home, including open houses, inspections and repairs.

A cash offer can also streamline a sale, enabling the seller to quickly move on to the next chapter in their life.

Hite says a cash offer can also allow a motivated seller to swiftly unload a distressed property.

He points to a recent offer he made to an elderly woman whose husband was deceased as an example. Although the widow and her husband were the original owners of a house built in 1996, they had deferred maintenance over the years until the house was, as Hite says, “rotted.”

The homeowner was in a dire situation by the time Hite entered the picture.

“She’d been unable to sell the house after listing it three times and was about to move in with family because she could no longer live alone,” Hite explains.

Hite stepped in and made a cash offer, which the woman immediately accepted.

“Our offer fit her financial goals,” Hite continues. “She also made a donation to Chambliss Center for Children because she saw in a brochure that the center is one of the nonprofits I support.”

Hite listed the house after giving it a facelift and making the necessary repairs.

“Although the market had rejected the house, it had value,” Hite says. “It just needed someone who had the money to address the deferred maintenance and update it.”

The finer details of how Spain’s team handles cash offers might be known only to the clients who have done business with him, as neither Spain nor anyone who works for his company responded to multiple requests for interviews – including phone calls, emails and messages sent through MarkSpain.com – from the Hamilton County Herald.

Spain’s director of sales in Chattanooga did indicate to the Herald that Spain’s company does not permit her or others in her position to speak with the press. Also, on one occasion, the person who answered the phone tied to the number on Spain’s website said the company’s marketing department does not have a direct number.

Instead, Spain allows his website to do his talking for him:

“Once you submit your home for a guaranteed offer, our team will verify if your home meets the program parameters. If (it does) ..., a guaranteed offer will be extended contingent upon an inspection. Finally, you have the opportunity to close in as (few) ... as 21 days upon accepting the offer,” the website read Aug. 22.

Since Spain operates out of Atlanta and has 18 offices in seven states, it’s safe to assume he isn’t able to inspect each home personally. While understandable, this points to one of the two primary differences between the two Marks: One is local and one effectively is not.

Hite moved to Chattanooga in 2000 and has served as a Realtor in the city since 2002. As an agent, he uses local banks to fund his cash offers and local title companies to perform his searches. He also hires Chattanooga-area residents to work for him. (This includes his call center, which he does not outsource.)

“I believe this community still values people who live locally, work locally and contribute to the community,” Hite says.

The Scenic City agent keeps his Local Mark hat on when he leaves his office at the downtown branch of Real Estate Partners, a locally owned independent real estate brokerage.

In addition to living in a newly built condominium on Cherokee Boulevard, he donates his time and personal funds to several Chattanooga nonprofits and other altruistic causes, including the Chambliss Center for Children, Habitat for Humanity of Greater Chattanooga, the CHI Memorial Foundation, Cempa Community Care, The Launch Pad and the American Heart Association’s Go Red for Women.

“If you want to have a successful local business, you need to reinvest in your community,” says Hite, whose charitable giving budget for 2022 is $200,000. “While you can look across the world and see many needy causes, you can also look through your window and spot the homeless people, the poverty and the unfair housing inequities in our communities – and we have a responsibility to help our neighbors.”

An Atlanta native, Spain joined Keller Williams in 2011 after 15 years of practicing real estate. There, he established a team that within five years helped more than 3,500 families close on a home, according to MarkSpain.com.

In 2016, Spain proclaimed his independence from Keller Williams and launched Mark Spain Real Estate. By 2021, his team had sold more than $3.3 billion in real estate and helped 10,300-plus clients sell or purchase homes, the website states.

In recognition of Spain’s achievements, the Wall Street Journal has named his company the No. 1 real estate team for closed transactions in the U.S. for five consecutive years.

When Spain opened an office in Chattanooga, his president and CEO John Makarewicz said via press release what most locals already knew: “Chattanooga is in a state with no personal income tax ... (and) has the second-lowest property tax of all 50 states, and the city’s cost of living is 8% below the national average. The variety of things to do here and ... (the ability) to easily connect with nature are also big attractions for residents.

“We’re excited about becoming a part of the greater Chattanooga community and serving families in accomplishing their real estate goals.”

Although Spain had figured out why people are moving to Chattanooga, he chose to remain in Atlanta. However, his remote location is not the only differential between him and Hite.

While Hite uses local money to purchase homes, for example, Spain uses real estate tech company Opendoor.

This could be problematic, Hite believes, because Opendoor recently agreed to pay a $62 million fine to the Federal Trade Commission for deceptive advertising.

“For years, ... (Opendoor) has touted itself as using its pricing tech to provide more accurate offers and lower costs, said the FTC, (and) claimed sellers would make thousands of dollars more than they would on the open market,” reads an Aug. 1 article on TechCrunch.com. “But according to the FTC, that wasn’t true.”

In response, Spain once again lets someone else do his talking.

“Opendoor and Mark Spain are partnering to empower you and your customers with more options. Get a competitive offer and sell your customer’s home safely,” Opendoor’s website reads in a pitch to real estate agents.

Hite does concede that Spain’s expansion into Chattanooga and other markets is no different from what other out-of-town real estate companies have been doing for years.

“The expansion model, where you open a sales team in a market other than the market in which you reside, has been happening for years across the country. Keller Williams pioneered that model,” Hite says.

If Hite hadn’t said this first, Tauris Odum, a local Realtor affiliated with Spain’s Chattanooga office, would have. Odum says the argument about who’s local and who isn’t is moot because Spain staffed his office with local residents and works with Chattanooga-area Realtors.

“Berkshire Hathaway, Crye-Leike and Coldwell Banker didn’t originate here. Those companies are based elsewhere, but they set up an office here and use local agents,” Odum says. “And you can’t be more local than me. I was born here. I raised children here. I pay taxes here. And my family lives here, my kids go to school here and they play sports here.”

Still, Spain’s pervasive marketing was designed to disrupt the local market, Hite says, while Odum agrees that the use of Spain’s full name for his company could be helping to solidify his branding.

With the housing inventory swelling locally and nationally after shrinking to a worrisome level during the pandemic, Realtors finally have a product to contend for again. To combat Spain’s aggressive incursion, Hite says agents in Chattanooga are going to have to step up and aim high.

“Disruption leads to change. Zillow was a disruptor as it entered the market and began to claim a share of sales. And online lending disrupted local lenders and loan originators, who had to sharpen their pencils and become more competitive and offer better service.”

Hite could hear the thunder of Spain’s imminent arrival long before the storm clouds reached Chattanooga. In response, he changed not only his message but also boosted his billboard count to 16, reshuffled his broadcast advertising to reach a different demographic and reallocated money from other sources to connect his name to online searches for “interest rates.”

Hite then tracked where prospective clients encountered his advertising to ensure its effectiveness.

“One older man said he hears my radio commercials every morning as he goes to work. When I saw his age, I said, ‘I bet you were listening to Sunny 92.3.’ He said, ‘Absolutely.’”

Hite also moved his personal retirement savings into a self-directed IRA so he could close a home in three days – as opposed to the 21 days promised on Spain’s website – if needed.

“I knew he’d spend a tremendous amount of money on marketing, especially radio, TV and billboards,” Hite points out. “To prepare, we became more targeted. We’re constantly looking at ways to innovate and reinvent ourselves for the market of the moment.”

One thing Hite says he won’t do is purchase as many billboards as Spain has, primarily because he’s convinced the Atlanta Realtor is losing money in Chattanooga – even though Spain is reporting sales jumps in Atlanta, Charlotte, Orlando and elsewhere, according to a variety of news releases.

Hite is seeing increases in volume as well. Through June, his team is up 16% compared to the same time last year, and he expects to do 20% more sales in August compared to the same month in 2021.

As a result, Hite says the funds he’s spending on billboards and other advertising is money well spent. But he’s not ready to return to doing business as usual.

“I’m thankful we’re out-trending the market, but Local Mark and his team are going to have to work harder and be more creative – and do more direct lead generation and lead follow-up – to beat Out-of-Town Mark and his team.”

Although the Mark Hite Team is consistently one of the top real estate outfits in Chattanooga, Hite says he has never considered expanding into other territories. If he ever does, he says, he’ll likely begin in Florida, where he has a second home.

Instead, Hite says he wants to secure more local ground.

“When we launched our guaranteed-offer program, my coach advised me to grab as much of the local market as I can before I try to expand into other markets, mainly because the expansions at that time weren’t profitable,” he says. “We’ll sell 500 homes this year, which will be about 2.5% of the local market. That’s what we intend to grow.”

Although Spain has been silent in the Scenic City, he has plenty of questions to answer. Will he stop using Opendoor? How many houses has his team sold in Chattanooga? Is he losing money on billboards here, as Hite speculates, or is his investment paying dividends? And how much of the local market does he hope to capture?

Perhaps Spain himself will answer these questions in person someday.

For now, he might enjoy air superiority, which the article in Air Force Magazine defines as “being able to conduct operations without prohibitive interference by the opposing force,” but not air supremacy, which the same article says, “occurs when the opposing force is incapable of effective interference.”

“We’re having a good year,” Hite says, “and it’s only going to get better.”