According to NAR’s last survey of foreign buyers, the United Arab Emirates (UAE) did not make the list of top 10 investors in U.S. real estate. So why does this country matter to NAR members looking to grow their global business? The UAE is home to an emirate or “city-state” called Dubai, a booming and modern metropolis that is quickly becoming a hub for global capital, especially real estate.
While between 6-8% of US residential real estate sales are to foreign buyers, nearly 85% of real estate transactions in Dubai are to foreign buyers, or non-UAE nationals, according to Mahmoud Hesham El Burai, Director General of the Dubai Land Department, NAR’s partner group in Dubai. Its international buyers hail in double digit numbers from countries such as the UK, Russia, and India, countries that do appear in the list of top ten buyers of US property.
Why do foreigners buy in Dubai?
It is a safe, clean, tax-friendly, and truly global city where many different nationalities can feel at home. Its housing stock is fairly new, with gleaming high-rises (including the world’s tallest building, Burj Khalifa), man-made islands that jut out into the Persian Gulf shaped like palm trees and a world map, land structures that have added over 1,000 miles of coastline to Dubai. Its real estate market is highly regulated and prices and appreciation are strong after a market crash similar to the U.S. Its currency is pegged to the U.S. Dollar. Dubai’s airport, one of the world’s busiest, puts it within eight hours flying time of two-thirds of the world’s population. Think of Dubai as positioned in the middle of a modern day “Silk Road” linking Asia, Europe and Africa. Its privileged location has become a safe haven of sorts, especially during the Arab Spring, with 80% of foreign buyers buying in cash.
So what does all of this mean for NAR members?
· Your foreign buyer may also be looking at Dubai as a place to invest
· By partnering with a Dubai real estate professional, you can share client lists and referrals
· Dubai can be a hub for you to attract buyers to your local market. For example, if targeting India or Russia seems daunting and complicated, you may want to tap into these communities in Dubai; chances are they bought in cash and may be looking to the U.S. as well to diversify their international real estate portfolio.
Best of all, the National Association of REALTORS® has a partner group in Dubai called the Dubai Real Estate Institute, a grouping of professionals who subscribe to a code of ethics compatible with NARs and meet strict criteria to practice real estate there. Within this group you will find fellow CIPSs, CRSs, ABRs, and International REALTOR® members all who understand the REALTOR® name and REALTOR® brand, and are eager to share their credentials and establish business connections. Consider Dubai as a target market to attract not only buyers from the Middle East but in other key markets as well.
Jeff Hornberger is NAR’s Director of Global Alliances and oversees its 80 partnerships in 60 countries around the globe. Jeff can be reached at email@example.com.
CIPS designees receive a printed, mailed version of the Global Perspectives newsletter as a member benefit. Past issues are made public on realtor.org within 2 months of publication. This blog post is based on the December 2013 issue covering Overseas Retirement.
Retirees settling abroad are predicted to be one of the fastest growing segments in the overseas property market. Some factors that are driving this growth include:
- Retirees looking for ideal climate/location for their preferred lifestyle
- Growing number of workers who can’t afford to retire where they currently live
- Countries are working to attract retirees with specific visa programs
- International developers building resorts/gated communities designed with retirees in mind
So where are they moving? Continue reading »
An amendment to Article 27 of the Mexican Constitution, which would have permitted foreigners to purchase property in the country’s restricted zone, was rejected on a procedural technicality, according to a communication issued by Mexico’s Secretary of Government (SEGOB).
The Mexican Chamber of Deputies (the lower legislative house of that country) approved the amendment last year. Had it passed, it would have allowed non-citizens to buy property within 100 kilometers of the nation’s borders with the United States, Belize and Guatemala and within 50 kilometers of Mexico’s coastlines. It also would have essentially ended the fideicomiso, the Mexican bank trust that allows foreigners to purchase rights to live on and use property within that zone for a set amount of time, said John Glaab, CIPS, vice president of international marketing for The Settlement Company, a real estate brokerage based in Mexico.
But the amendment procedure was not continued within the proper time frame, he added. The bill was never passed by the Mexican Senate or approved by the requisite 16 of the country’s 32 states and, consequently, the restricted zone of property ownership will remain in place for the foreseeable future.
Glaab speculated that the fideicomiso, which has been in place for more than four decades now, would not be seriously challenged again for another 10 years or so. “At the moment, Mexican politicians have their hands full [with the passage of several reforms],” he said.
However, there is a bright side to the continuation of the fideicomiso. “There is no probate,” he explained. “Here, that takes a lot of money and about 10 years to finish the paperwork and [make a] decision.”
At NAR Global, we think our Certified International Property Specialist designation is pretty, well…special. Our instructors never cease to amaze with their intelligence and vast experience, the course material is full of “a-ha moments,” and each class is full of enthusiastic students who are eager to learn and have their own breadth of experiences to share.
The designation is a truly valuable experience. But don’t just take it from us – below is a student’s perspective on the value he derived from the classes and designation. And oh, by the way – he’s located in Los Cabos. What better destination if you have clients who are freezing up north? (Side note, they are hosting another Institute there as well. Details below).
For years I downplayed the notion of fellow real estate agents acquiring acronyms behind their names. I was, after all, a seasoned veteran of the Cabo sales scene, so how could a few initials enhance my real street smarts?
Then, in June of 2013, out of my innate compulsion to serve, I helped organize the first CIPS (Certified International Property Specialist) Institute for our AMPI Los Cabos chapter, at the request of Linda Neil. So, I felt compelled to attend five day course. I invested hundreds of dollars with no idea what the value would be. Linda Neil is a captivating instructor who keeps it moving, and made me glad that I attended.
The CIPS Institute was an eye-opening education on where we fit into the world real estate marketplace. I learned how Mexico’s laws and idiosyncrasies compare with other countries. I have been in touch with many CIPS fellows around the world, including our prime market areas of the U.S. and CANADA, and am working on some mutual leads through the CIPS network. This is really becoming a value proposition. I have received one group of foreign brokers on a familiarization trip as a direct result of contact made through CIPS. I have expanded my personal presence by three continents!
And fortunately, the CIPS Institute gave me some requisite course requirements for other designations, including the Accredited Buyer Representative, which is my latest course of study.
I highly recommend the CIPS Institute to all of you. Take the week off from “work”, invest in yourself, improve your outlook and broaden your horizons. I do not believe that any of the 35 attendees last June regrets their decision to attend. I know I don’t. And those little acronyms behind your name actually can enhance your future.
Douglas Christensen, Broker
Cape Realty Associates
Certified International Property Specialist
Details on the upcoming CIPS Institute in Los Cabos are available at http://globalmexico.org/.
General questions about the designation can be directed to firstname.lastname@example.org or +1.312.329.8369.
When trying to successfully navigate real estate transactions with clients from overseas, it’s critical to make an effort to connect with them on a cultural level.
That was the message shared by Tim Hur, a REALTOR® and 2014 chair of NAR’s State and Local Forum on Global Business, and Stacey Mollison, president of the Empire Board of Realtists (representing the Atlanta area within NAREB). Both Hur and Mollison, who practice real estate in the suburbs of Atlanta, offered ideas to attendees of the Diversity Forum Tuesday at the Georgia REALTORS® Inaugural Meeting and Legislative Conference in Cobb County, Ga.
The state of Georgia has seen significant, multi-decade growth in global business activity. As a result, real estate professionals like Hur and Mollison have dealt with an increasing numbers of non-U.S. clients, many of whom have radically different backgrounds from their own.
But both of them have found success with their diverse clientele by seeking to understand their culture and its values before actually meeting them face to face. “I usually research [the client’s] culture,” Hur said, and added this not only makes them more comfortable, but puts him more at ease as well, as he doesn’t have to obsess over unwittingly committing a social indiscretion.
This is especially important when dealing with people who come from high-context, relationship-based cultures, he explained. You have to take time to build trust and demonstrate you understand their unique needs. However, once you’ve established that you’re a dependable, conscientious agent who they can work with easily, you’ll find more business flows in as they refer their family members and friends to you.
Mollison, a Christian who was born in Guyana and grew up in New York, said she found working with Muslim clients a challenge at first, as she initially found some of their customs difficult to comprehend. For instance, the men in Muslim families are expected to make the final decision on a home purchase, and therefore a listing presentation or a property showing should focus on shaping their opinion. This is something of a departure from working with American couples, where the woman is typically at least an equal partner, if not the one making the decision.
After investing time into learning about the culture and values of people from Muslim countries, Mollison has attained a level of comfort and familiarity in working with them on property purchases. And because she put in that effort, they now make up a large portion of her client base, she said.
Read More: With Global Clients, It’s Less About Money
Weather forecasters are calling for 6-8 more inches of snow in Chicago this weekend─ the polar vortex won’t be leaving the Windy City anytime soon. Depending on where you live, you too may be dreaming of the glory days (aka summer) when you can leave your home without wearing two pairs of pants, 9 pairs of socks, and an over-sized coat that looks more like a sleeping bag than a jacket.
If you’re like me, and are looking to escape the harsh winter climate, (or for our friends in the Southern Hemisphere, suffering from sunburn and yearning for ski slopes), perhaps this is a good time to remind you about the Global Meetings & Events Calendar.
Global events are a great way to build your professional network and expand your knowledge of global business practices. While the real estate business may be about properties, practitioners know that their profession is really about the people. Now is a great time to start thinking about growing your global network throughout 2014! There are exciting real estate events happening all over the globe (in both warmer and colder climates).
NAR’s Global Meetings & Events Calendar provides a list of worldwide events hosted by our cooperating associations, or sponsored by other industry alliances. The calendar is updated regularly and event organizers will often offer REALTORS® discounts on registration. For specific information on any one of the events listed on the calendar, please contact the sponsoring organization for complete details. Additionally, if you have questions, don’t hesitate to contact us at email@example.com
Click here for more information regarding international events and growing your global network.
By now, you probably know that NAR maintains partnerships with trade associations, franchises, and government agencies in 60 countries across the globe. What may not be as clear, however, is just how NAR designs and implements strategies to ensure that these partnerships create valuable networks and business opportunities for members while raising the Association’s profile as a thought leader in the global real estate sphere. The following text may be a bit more technical than what you are used to reading here. It is part of an internal white paper on NAR’s strategy in the Asia region and is a terrific example of how we hope to position the association as a global hub of critical information and activity: Continue reading »
Overcome the Barriers that Stand between You, Your Client, and the Closing Table
Real Estate professionals know that every real estate transaction is unique, each with its own complexity. However, professionals that work with global clients know that international transactions can be some of the most challenging- but also the most rewarding- to facilitate. Knowledge and preparation are essential to completing a successful transaction. The onus is on you to help your clients steer clear of potential obstacles.
According to NAR’s 2013 Profile of International Home Buying Activity almost a quarter of all U.S. REALTORS® who reported having international clients said that they never made it to the closing table. The inability to overcome language and cultural barriers could account for some of these unsuccessful transactions, but other obstacles can also derail a transaction, including lack of understanding of how real estate is practiced, currency fluctuations, taxes, visas and financing arrangements. If you want to become a successful global agent, you need to learn about these differences and help your buyers work through them before unexpected problems become insurmountable. Is the extra time and energy worth it? Absolutely! When you consider that last year the sale price of U.S. homes purchased by international buyers was $95k more than the median price of all transactions- and that more than 60% paid cash, there are legitimate reasons to work harder for these buyers. Continue reading »
At the State and Local Forum on Global Business in November 2013 in San Francisco, leaders on the association staff and member side gathered to discuss best practices, new ideas and challenges involved with starting or growing global programs at REALTOR® organizations. The last issue covered at the Forum addressed executing global programs at the state level:
We are a state association that started a global council a few months ago. So far, so good, but we’ve had a number of local associations come to us with various requests in the short time since we got it going. What exactly is our obligation to the local associations? What should we be offering at the state level to distinguish our group from those of the locals?
Here are some of the ideas attendees came up with:
- Contact staff at NAR Global for guidance and support.
- Stay current on what’s going on with global at the local associations in your state to make sure you aren’t unnecessarily duplicating their efforts and, if appropriate, to share what they’re doing with other locals.
- Serve as a resource for local associations that want to start a global council/committee.
- Designate a statewide staff liaison to help local association staff manage and promote global messaging, events, etc.
- When needed, take the lead on global programs in your state.
And here’s more advice from NAR Global staff:
There’s no set-in-stone way to do global programs effectively at the state level. What’s undertaken depends largely on the state in question (geography, population, urban vs. rural, economy, etc.). For example, when it represents a geographically small area, the state association may be the prime mover of global activities for REALTORS®.
That said, a few of the more common activities that state global councils take on include:
- Becoming a promotional hub for networking events and educational opportunities put on by in-state local associations.
- Offering global informational sessions and designating space for global activities at the trade show of their annual conventions (if they have one).
- Raising awareness of global in other state-level committees and networks, such as commercial, government affairs and YPN.
- Creating a global section on the state association Web site and/or in the print magazine that includes news and research.
- Provide global talking points as appropriate for legislative days for members when they visit the state capital to promote REALTOR® positions on issues.