By John Voket
RISMEDIA, Nov. 29, 2007-Anyone willing to embrace the growing diversities among consumers should expect numerous opportunities in the real estate space, according to Oscar Gonzales, president and founder of diversity marketing firm The Gonzales Group. Gonzales shared his thoughts at a session titled “Five Reasons Why You Must Learn about Emerging/Specialty Markets,” during RISMedia’s 18th Annual Leadership Conference.
Along with Gonzales, the panel included: Frances Martinez Myers, senior vice president with Prudential Fox & Roach; Alan Thompson, vice president and regional director of emerging markets for Stewart Title; and Margaret Ling, multicultural liaison with Fidelity National Title Group.
Among the many reasons to tap new and emerging specialty markets, five major points surfaced during the 90-minute panel:
Gonzales peppered the panel and audience during introductory remarks, with a goldmine of statistical details, conjuring up visions of real estate booms seldom seen in the past century-and-a-half.
“By 2050, the Asian and Hispanic population will triple over the rest of the non-Asian/Hispanic population growth rate,” Gonzales explained, quoting credible sources, particularly the U.S. Census Bureau. “The Hispanic population in America already crossed the 300 million mark as of February 2007.”
He reminded the crowd that it was only about 20 years ago the Asian/Hispanic numbers were less than 1% of the overall population. He said the rapidly expanding ethnic populations, especially Asian/Hispanic, are predicted to gain a significant degree of influence in the real estate world as early as 2012.
“The industry will be dealing with significant population shifts,” he predicted.
2. Clients with Buying Power
Gonzales didn’t have to work hard to get the audience’s buy-in with predictions about ethnic market buying power.
“By 2012 (African American household) median income will increase 12.69%, a 237% jump,” Gonzales said. “But take a look at this – while Hispanic income is only predicted to rise 9.54 percent, it represents a 434 percent increase.”
And reinforcing a point made time and time again during the workshop, by 2012, Asian household increases will top 11.95%- a 457% increase-crossing $1 trillion mark by 2009.
The panelists agreed Asian markets are particularly accessible right now because of the limited amount of companies successfully capturing these clients, who Ling reminded, usually higher than median income.
“They pay off early and keep the first house and as an investment,” Ling said, adding that in the case of a lot of young couples, “their family will often give a $100,000 down payment or more.”
Myers observed that her Spanish-speaking clients see the current turbulence in the market as an opportunity, so besides the rapidly increasing population of Hispanic clients who need to buy homes, Realtors can count on those who are out looking because they think now is the time.
“They don’t mind the interest rates,” Myers said of the Hispanic buyers, “but they do want to drive the deal.”
3. Clients for Life
As Ling alluded, both Asian and Hispanic real estate customers seldom resign from established business relationships, especially when it involves real estate. So establishing clients from these demographics often means establishing a key referral source for life.
“They need to know you speak their language,” she said.
Through his research, Thompson learned early on that ethnic clients wanted simple things like in-language documentation.
“At the closing they do not want a translator there because they want to be able to go back to the documentation a year or two down the road without a translator, he said. Armed with ideas on how to attract and retain Hispanic clients, Thompson participated in a Peachtree Latino Festival in Atlanta, and in just a few hours, got 1,199 leads including many for mortgages.
4. Buying Habits
Even agents who don’t speak the language find success in catering to emerging ethnic markets, as long as they understanding particulars of the culture. Myers drew a lot of nods from audience members when she referenced her experiences with the vast majority of her Asian clientele.
“Remember, you might be dealing with the whole family,” Myers said. “And once they decide they like it, they bring their Feng Shui expert in. If that fails, move on to the next piece of property.”
She reiterated a point made earlier about recruiting Japanese and Korean staff who she predicted will, “drive business to your office.”
5. Opportunity to Partner in Emerging Communities
While recruiting multi-lingual staff and agents to one’s company can forge expanded inroads to specialty population, the panel members reinforced that it is just half the battle.
“Join community-specific groups and networking opportunities,” Thompson suggested.
Ling joined in encouraging entrenched office cultures to break free of the status quo, engaging in more diverse networking situations. “You’ve got to get people out to their events in the community,” she advised. “Consider establishing an office and brokerage in the neighborhood.”
“From a marketing perspective, think outside the box. Go to populations who aren’t being served,” Thompson said, recalling a former employer who successfully marketed to a growing Native American population.
“We knew Native Americans were interested in buying properties,” Thompson said. “You’ve got to be fishing upstream, getting the clients before someone else is thinking about it.”