Do you have a successful business that’s ready to tread onto international grounds? Growing your company into an international firm offers the exposure and growth opportunities to transform your business from a domestic success to a global powerhouse. Global expansion also offers the flexibility to rely on an alternate market when others are experiencing fluctuations.
According to the Global Luxury Residential Real Estate Report 2015, published by Wealth-X and Sotheby’s International Realty, there are 211,000 Ultra High-Net Worth (UHNW) individuals around the world. Seventy-nine percent of them own an average of 2.7 homes, and over 50 percent own three or more homes. The latest data on secondary luxury home purchases show that the U.S. is the most popular destination for international buyers, with New York, Los Angeles, San Francisco and Washington, D.C., as popular, sought-after locations.
Home sales to foreign buyers (resident and non-resident) accounted for 4 percent of the total existing-home sales between April 2014 and March 2015, according to the 2015 Profile of Home Buying Activity of International Clients from the National Association of REALTORS® (NAR). International buyers exhibit higher purchasing power than local buyers; consider the potential if foreign real estate companies decided to expand into the U.S. to serve the budding market of international buyers from their home countries.
“One of the keys to successful strategic global growth is always keeping a global mindset,” says Stephanie Pfeffer Anton, executive vice president for Luxury Portfolio International®. If you aspire to open an international branch, begin by considering factors like business opportunities, language, culture and the economic and political environment. Navigating an unknown playing field can be difficult, but ample research and collaboration with an experienced international agent can be beneficial.
It’s also imperative to travel to the proposed location and interact with local buyers and sellers to receive first-hand knowledge of your target market and potential competition. You need to ensure that there’s a market with demand for the service you provide.
A deciding factor could be the business potential shown by a particular location. For instance, many nations, like Portugal, Belgium and the U.K., attract wealthy buyers by offering residency and citizenships in exchange for real estate investments. You can take a cue from these nations and choose a region with a particular clientele that suits your business.
Reaching Out to Global Clients
Why would a customer approach you, a foreigner, when similar products are available from local vendors? Understanding the needs of your clients and reaching out to them effectively is key and requires the presentation of your company’s original voice in a culturally updated tone.
Focusing on specific demographics provides a precise focus to help your business navigate the international market in smaller, exclusive segments. For instance, did you know that UHNW women own properties that are 10 percent more valuable than those owned by men, and that single female homebuyers are ahead of single male homebuyers in the U.S., accounting for 15 percent of all buyers? Your marketing strategy could target this emerging group to create an exclusive client base comprising women homeowners.
Dealing with and meeting the needs of buyers in foreign countries may require specialized training and extensive knowledge of immigration, taxes, financing and other related subjects. International real estate is an avenue worth exploring if you dream of making it big in the real estate continuum.
Desirée Patno is founder and CEO of the National Association of Women in Real Estate Businesses (NAWRB).
For more information, please visit www.nawrb.com.