July 13, 2008

Spanish language radio stations hit hard by drying up of zero down mortgages

The same days as the news of proposed government bailouts of Fannie Mae and Freddie Mac, the Washington Post runs a revealing article on how the drying up of subprime mortgages has badly hurt the advertising revenue of Spanish language radio stations in the DC area:

But these days the subprime mortgage meltdown has hit many Spanish-language radio stations hard. Real estate companies that targeted the Hispanic community have closed their doors or cut back on advertising and sponsorships. Aragon has lost most of the real estate agents who once advertised with him…

As the housing market took off, Spanish-language radio and real estate companies -- two businesses that are highly locally focused -- became increasingly intertwined. Jose Luis Semidey, a real estate agent who catered to the Hispanic community, ran Radio Latina at 950 AM in Potomac and 810 AM in Annapolis. He's no longer an agent, and he ceased operating the stations in 2006. The realty firm Vilchez & Associates was a principal sponsor of Radio Universal in Manassas at 1460 AM, which no longer exists. It was shut down last year to be reopened this year as La Kaliente, with a new format and a new owner.

Peruvian native Ronald Gordon, whose Arlington-based ZGS Communications operates 11 Telemundo television station affiliates and three radio stations, including VIVA 900 AM in Laurel, said the housing bust has hit Spanish-language radio in the area, much like it has hit the whole Hispanic community.

"I think in terms of the mortgage and real estate industry, we were over-indexed in terms of advertising," Gordon said.

With a pair of headphones over his brushed-back black hair, his lips never far from a suspended microphone, Aragon can be found weekday mornings in his studio, pumping out a steady diet of Spanish-language news, talk, and Mexican and Central American tunes on his show "Buenos Dias Washington."

Aragon began renting his station's signal from JMK Communications of Los Angeles in 2002, changing its format from country to Mexican regional. Those days, the housing boom was just getting underway and an influx of Hispanics that would change the county's demographic mix had begun.

The station began throwing an annual Fiesta Hispana in its parking lot. It promoted Mexican and Central American bands. And when the latest immigration debate heated up, the station served as a place for information about demonstrations and meetings.

At the height of the housing boom, Aragon had as many as 15 real estate agents advertising with him, he said. He got his own Realtor's license three years ago and began advertising his services on his show -- which he still does today. Only one other real estate agent remains as an advertiser.

My published articles are archived at iSteve.com -- Steve Sailer


Anonymous said...

From the article:

Changes are in the works at Radio Fiesta. In January, Aragon hired his 28-year-old daughter, Melissa Gieras, as the station's business development executive. She has been drawing up revised programming plans and pitching the station to more advertisers outside of the county. She has also been laying the groundwork for a nonprofit group intended to be a resource for the county's minority-owned businesses.

That sounds like a winning business plan. Hire your still wet behind the ears daughter to try and run the station.

Nepotism, it's America's future.

dearieme said...

Meantime, here in Britain one of our little mortgage banks is apparently to be taken over by the large Spanish bank Santander. So now if there is trouble, is it up to the Spanish government to do the rescue? But it doesn't have a currency of its own, so therefore...what?

c.o. jones said...

A little-remarked-on aspect of Spanish-language radio is how little money the stations actually make.

Take Southern California for example. The Spanish stations have huge audiences, but due to the socioeconomic status of the typical listener, they cannot command the same ad rates that even low-rated English language stations can. Put another way, you don't hear ads for Rolex watches or high end import automobiles very often these stations (if at all) - the audience just doesn't have that kind of money - so the stations have to compete strictly on price for the bottom end of the market.

Eddie "Piolin" Sotelo may have huge ratings, but he's probably making 1/10 of what a guy like Ryan Seacrest makes, if that.

It's a reasonable assumption that a guy who's supplementing his income as a real estate agent (and probably as a "notario" and running a "farmacia" as well) isn't making much money running his radio station.

none of the above said...

I suspect a big part of the hit is coming from the "stated income" loans going away. If you're making a lot of money working off the books, this kind of loan makes some sense, though the inevitable abuses have pretty much gotten rid of it.

Another source of the hit is that the construction industry is in a big slump, as a result of the housing market being in a big slump. That's where a hell of a lot of recent immigrants were working, and what made it possible for some of them to afford to buy houses or condos.

Anonymous said...

"Ronald Gordon?" Good Hispanic name there.

Lucille said...

Good Hispanic name there.

Like Fujimori.

Anonymous said...

"Ronald Gordon?" Good Hispanic name there.

Or Nicolás Lindley

David said...

The powers that be always portray decline as a result of natural forces. "Hispanics are taking over - the wave of the future - unstoppable and inscrutable predestination of history - get used to it! EMBRACE the vibrancy, you racists!"

But, in reality, it's a manufactured change, unnatural and - when natural factors assert themselves - as thin as piss on a rock.

Same with the idea that "you can't possibly get rid of illegal aliens in their millions - all of them are here to stay!" No, they aren't. The tiniest efforts at immigration enforcement are driving them from entire towns. Link. Another link. Combine such enforcement with a cut-off of social services - plus a reduction in construction jobs generally - and you have an Exodus of Illegals. It's doable; what's lacking is the will to do it. Which the fait-accompli types are working day and night to sap. They want the death of white America.

I wonder if we will see these Hispanic radio stations subsidized suddenly by Time Warner or some other combo of fat cats/change agents? Keeping the wave of the future rolling isn't cheap.