Let me start with an important question: are you missing out on a consumer segment that could boost your real estate business?
If you’re not looking at foreign home buyers (those looking to move here or recent immigrants), you might be missing out big time. That’s because sales to foreign consumers in the United States are sky-rocketing. A new report from the National Association of Realtors (NAR) has found that from 2013 to 2014, home sales to foreign buyers saw a whopping 35 percent jump from $68.2 billion to $92.2 billion. That’s a full 7 percent of the $1.2 trillion existing-home sales marketplace.
Could you use a 7 percent increase in your business? You might be able to achieve it in the foreign market. There’s clearly room for more agents. NAR says just 28 percent of agents they surveyed reported working with buyers from other countries.
Here’s what you should know about this burgeoning market:
1. Know where they’re coming from. NAR reports the five countries most buyers come from are: Canada, China, Mexico, India and the United Kingdom. Canada accounts for the largest share of clients, but China is the fastest growing source of clients, now accounting for 16 percent, up from 9 percent since 2007.
2. Know how they connect with real estate professionals. NAR says of agents who work with foreigners, 59 percent reported that clients were referred to them through friends, previous clients, and international and domestic referrals. About 19 percent of clients came through website or online listings. The primary sources of online leads were the agent’s own website (24 percent), the local MLS website (16 percent), and other aggregators (17 percent). Realtor.com, which launched an international site (www.realtor.com/international) in 2011, accounted for 6 percent of online leads.
3. Know what they’re seeking. Most homes purchased by foreign buyers are used as a primary residence. Foreigners who are not residents use their properties mainly for vacation or rentals since they are limited to stays no longer than six months. NAR reports that 65 percent of foreign home buyers purchased a single-family homes, and nearly half of these international clients chose properties in suburban areas. Furthermore, about 25 percent chose city properties, and 13 percent chose to buy in resort communities. Location continues to appear to be the primary factor affecting residential home purchases for international buyers, depending on the buyer’s employment, vacation preferences, family, educational and investment objectives.
4. Know where to go from here. NAR can help with specific international professional development opportunities including the Commercial & Global Services Group and the Certified International Property Specialist (CIPS) designation. Visit http://www.realtor.org/global for more information.
Let me hear from you. Is your market big enough now to help you reach your goals? If not, what opportunities exist in your farm area to expand your market? What can you start doing today to improve and grow your business?