By Nick Caruso
When examining the overall picture of global real estate business in the United States, the facts speak for themselves: International buyers now account for $82.5 billion of residential purchases; global business fared a 24 percent increase over last year; 27 percent of REALTORS® deal with international clients. This is just a slice of the data provided by the 2012 NAR Profile of International HomeBuying Activity, which strongly suggests that international business is a sector of the market that simply cannot be ignored.
To harness this rapidly growing trend, the National Association of REALTORS® launched an international response on their official website found at REALTOR.com®. Since the launch of NAR’s international efforts in November of 2011, the site has grown at an exponential rate. The listing count has increased by over 60 percent as the site now sees nearly over 4.4 million active listings, 1.4 million of which are international and represent 22 countries. The data continues to speak volumes, as nearly one million unique visitors visit the website monthly from outside the U.S.
“I think there’s a huge opportunity for us to not only be more receptive to buyers from other countries, but for folks in other countries to be receptive to the opportunities that might exist in a recovering economy,” says Moe Veissi, 2012 NAR President. “For buyers in the U.S., this includes expanding their interests outside the borders of what they’d normally think were accessible.”
Given these opportunities outlined by Veissi, it makes perfect sense that NAR would want to streamline and simplify the buying process for international buyers who have proven their merit and continue to be reliable contributors to our overall housing market. According to Eleonore Rojas, Principal Product Manager of Move, Inc., the leader of the Move Network of real estate related websites that includes REALTOR.com®, international clients make up 4.8 percent of U.S. residential sales and have been much more active since the launch of REALTOR.com® International.
“It’s very important for customers to have a space where they can take advantage of these options,” she says. “Engagement of our consumers has increased pretty substantially. Comparing June 2011 with June 2012, we saw a 40 percent increase in searches from other countries on REALTOR.com® and REALTOR.com®/International combined.
In addition to working with 22 countries, REALTOR.com® is adding more countries to its system on an almost monthly basis, most actively working with partners from Canada. There is also discussion of integrating additional content from Europe, in particular, Greece.
“That is quite an increase from the 11 countries we launched with. I predict we’ll add quite a few more by our first anniversary,” says Rojas.
Where Are Global Buyers Searching?
Assessing further, who is searching and where they are searching have become very important segments of data when considering international clients and business. Although varying from month to month, the following countries have expressed the most interest in properties stateside: Canada, Australia, China, India, the UK, Germany, France, Italy, Mexico and Japan, all of which are consistently in and out of the Top 10.
Where buyers from each country search also varies. According to Rojas, Canadians prefer Los Angeles, Las Vegas and Florida; Europeans and Australians gravitate toward Southern California, Vegas, Florida and New York; Mexicans tend to like Texas, California and Vegas; Chinese shoppers look for Southern and Northern California, Chicago, Miami, and Vegas.
Some trends aren’t surprising, as with the case of Chinese buyers, or those from Brazil, who tend to focus in on Florida. Proximity becomes a leading search criterion for many. Other trends are a little more calculated, such as Germans searching in Los Angeles, San Antonio, Las Vegas, Colorado Springs and Miami – all of which are homes to U.S. Military bases.
Although international buyers fluctuate in their U.S. city preferences, some cities do frequent the most-searched list. According to NAR and REALTOR.com®, the following cities were the most searched by non-U.S. consumers throughout the month of May 2012:
1. Los Angeles, Calif.
3. Las Vegas
4. New York
5. Orlando, Fla.
8. San Diego
9. Fort Lauderdale
10. San Francisco
Veissi believes that in conjunction with these major markets profiting and flourishing, micro-markets are sure to be on the bound as well. Word of mouth is a powerful tool working in our favor as foreign buyers and investors return to their homelands and parlay their thoughts and feelings about certain locales.
“You have that energy that exists because folks like to be with people they know and the best recommendation frankly is from somebody you have faith in and are close to,” says Veissi. “That’s how these micro-markets begin to develop. I think you can look at the major markets as remaining major markets across the board, but I think you’ll see some other minor markets begin to develop as buyers become more Americanized.”
Las Vegas: A Closer Look
To truly understand the impact of international business in our country, lets take a closer look at one of the more prolific major markets working within the global market today: Las Vegas. Although many refer to Vegas using the trite moniker “Sin City,” Las Vegas has so much more to offer foreign investors. It’s clean, convenient and easy to navigate. It has 24-hour medical facilities within a short distance of almost every area. And yes, there is that whole entertainment factor. Add in the lack of income tax, incentives for business owners, and low-humidity weather, and it’s easy to see why Las Vegas is such an attractive option for non-U.S. buyers.
“Las Vegas is an international mecca and practically every transaction has some global element to it,” says Tamara Tyrbouslu, broker-salesperson and educator for Realty One Group in Las Vegas. “Practically all of my business is either directly or indirectly related to this niche, whether it’s consulting for a developer in Brazil, cooperating to procure purchasers for a casino in Macau, representing buyers from Egypt or mentoring agents on how to market their properties and listings abroad.”
Speaking of global elements, one of Tyrbouslu’s current buyers is an Australian who works in South Korea and handles his finances in Hong Kong. “He’s looking to retire to Las Vegas, which is a growing trend I am witnessing in our marketplace,” she says.
Tyrbouslu is also a NAR Certified International Property Specialist (CIPS), a designation that provides brokers and REALTORS® with the knowledge, research, network and tools necessary to help globalize one’s business. Thanks to her CIPS training, she has an entire network of “elite and enlightened industry leaders” at her fingertips. “My best referrals come from CIPS designees and they are the first agents I seek out when referring clients to an agent elsewhere in the U.S. or the world,” she says.
According to Tyrbouslu, international investors are typically practical with their finances. “They have been watching the market; they are patient-minded; and they are sensitive to market cycles and seasons with reasonable expectations of returns on their investments.”
The American marketplace in general has plenty of pros to offer international buyers, including property rights, the ability to insure title, political, social and economic stability, and religious and cultural freedom. For these reasons and more, areas like Las Vegas are active and thriving with part of the thanks due to this international niche. “We are truly a place that honors everyone’s freedom to worship as they choose, and celebrate multiculturalism and diversity,” she says.
A New Boundary-Free Normal
Thanks to a landscape of ever-adapting technology, society and the real estate industry have reached a new normal. This new normal is without boundaries, revitalized by an influx of information, proving that open possibilities are on the horizon for any interested party regardless of location. Through this modernized looking glass, the world is a bit smaller, bringing stateside opportunities to the shores of Brazil, South Korea, Ireland, and beyond. Buying a Tuscan villa, a Spanish hacienda, or a homey abode on the water in Croatia seems more possible now than ever before. With more and more REALTORS® working with international clients today, servicing this niche has never been more important.
“We definitely have a much more engaged consumer audience from non-U.S. visitors than ever before, and that was why REALTOR.com® International was one of the big services that we wanted to offer,” says Rojas. “At the end of the day, our main goal is to connect real estate professionals with consumers to promote homeownership, and we saw a very big opportunity to service another audience.”
“There’s a lot going on today that maybe 20-30 years ago, people wouldn’t have worried about,” adds Veissi. “Today, we’re not only worried about it, but we’re involved and want to be progressively proactive so we can accommodate not just those investing in America, but those Americans who would like to find second, third or fourth homes overseas.”
For information and resources to help you grow a global business, visit www.realtor.org/global.