• Associated Press via Columbus Dispatch, Tuesday, July 31, 2007 10:33 AM

The sagging housing market that has lead to a slump in real-estate advertising at newspapers is bad enough, but what is worse for publishers is that even when a recovery comes -- assuming it does -- most of that money will not return. Real estate ad dollars are shifting online at an increasing pace as industry executives move out of newspapers and onto the Internet.

That shift is going to sting, because classifieds can make up more than 35% of newspaper revenue. Mike Simonton, a media industry analyst at Fitch Ratings, notes that the Internet's share of real-estate and auto classified advertising is going to move higher. "Newspaper advertising should remain under pressure until newspapers are better able to address the threat of online advertising."

While some big real-estate franchisors say newspapers are still essential to selling a home, younger brokers, home sellers and buyers are more focused on the Internet. "For our agents, newspapers are an old standby," says Abby Lee, director of regional advertising in Denver for RE/MAX. "With younger agents, there's a trend of going online. There's a realization that's where they need to be."

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