From a sales perpective, foreign real estate investors are an attractive and fast-growing part of the market.
They tend to pay cash for property. And the typical sales price they pay is higher than the median price for property in the U.S., said Don Pasek, a REALTOR® and managing broker with Omniterra Real Properties.
But while there is plenty of opportunity, international clients need additional help to navigate a real estate system which may be unlike anything they have experience with, Pasek told REALTORS® attending the Illinois Association of REALTORS® Multiculural Summit held in Oak Brook April 18.
He offered tips for building business and making foreign clients comfortable with buying real estate in the U.S. The event, in its third year, focussed on building sales relationships with European and Russian markets. It featured a number of panelists with expertise in international real estate transactions.
Pasek said international investors have high liquidity. "Many use all cash and you won't have to worry about financing," Pasek said. "Sixty-two percent of the purchases out of $82 billion were cash only."
How to connect with real estate buyers from abroad
Pasek, who has traveled to Poland as part of his effort to build business, said there are several steps real estate professionals can take:
Look at your current clientel: Do clients know you handle international sales? Pasek said existing relationships may help spread the word about your services. Also, look at joining cultural and communty chambers of commerce to make connections.
Do you speak the language: Nearly 20 percent of Illinoisans speak a second language. Pasek asked if the websites businesses use communicated language services as a way to build interest.
Set up an international committee within your local REALTOR® association: Pasek said the interest is often high among members and the costs for taking this step are low.
Go overseas: "This does cost a little bit of money," Pasek said. "You can write off the trip as long as you do business, and you might make some money along the way."
Key to sale: Build trust
Pasek said to build business requires trust. An since many international clients come from countries where real estate professionals aren't licensed, they will be confused by how transactions are handled in the U.S. Pasek said a key is carefully explaining and outlining the process.
"Keep the client informed, and keep calling them even if nothing has happened," Pasek said.
Because language can be a barrier, Pasek suggested paying special attention to speaking simply and clearly. Don't use slang or jargon, he said.
At the closing, Pasek said an agent should be prepared to stay for the entire transaction.
"At the last minute something can go wrong," Pasek said. "Remember, many of these things are cash transactions. Prepare your client for the time, what to bring and translate as you can to help people feel confident."