Using the Web and social media to sell real estate

The United State real estate market offers right now the best appreciation and stability potential world wide. This is the shared opinion of many international investors who join together into an association that takes care of representing their trade, information and political needs inside of the US. Its name is Association of Foreign Investors in Real Estate and brings together 180 other organizations in 21 separate countries.

AFIRE (afire.org) has its headquarters in Washington DC, very close to the source of all political and legislative decision in the United States and has the first and foremost purpose of deliver timely and precise information on any new law or tax regulation that could affect international investors so that they stay abreast of the change and can be competitive with domestic investors.

The United States offer the most stable and secure real estate market for international investors.

Every year, AFIRE conducts a survey among its members to establish which international real estate market offers the most stability and security and which has the highest appreciation potential. The latest survey published at the beginning of 2010 shows that the United States still offer the most stable and secure investment environment.

The closest competitive nation is Germany that ranks about half and then we have Canada, France, Australia and the UK.

The Unites States real estate market offer the highest appreciation potential world wide according to AFIRE members..

The United States also offer the best appreciation potential even when compared to growing economies like China and Brasil or to established economies like the UK, Germany and Canada.

The perception of potential appreciation in the US has been increasing steadily in the last four years.

Considering the historically low prices of real estate, the United States have been increasing their perceived appreciation potential constantly in the last four years and today most of properties can be bought well below their replacement value, which means they are undervalued due to the presence of a high number of foreclosures, but have the potential of going back to their correct values once banks will have depleted their reserves of repossessed properties.

Who comes today to the United States can find investment properties that produce a net income that can be more than double of what could be obtained in Europe for a comparable investment or can find a quality vacation home well below market value and in very nice locations.

Roberto Mazzoni

Concentrated as we are in selling a specific house or “making a deal” in our own market, we easily lose sight of the major factors that can make all the difference between fighting every day for a result and growing an healthy real estate business. Real estate is local by definition and therefore you need to know your backyard well or you need to have means to cover multiple markets by serving a specific type of client. In the last couple of days I have met a Realtor who is specialized in dealing with customers from Australia and who has managed with his firm to close one deal a day in the last few weeks and there seems no end in the supply of cash he is getting from overseas.

Capital flow is a key factor in US real estate right now.

He did a very good work in creating the relationship of course and is very diligent in procuring the types of properties that his clients ask from him, but would you like to be in his same position? Well you need to be familiar with the global forces that impact your local market and that can dictate whether you should stay there or change market altogether.

The first and foremost of this force is called “capital flow” and it is intimately connected with international real estate. Capital flow is not only currency exchange and the transferring of cash from one nation to another in order to buy goods, it can also involve the transfer of assets, capital goods (machinery or goods used in producing something else), debt and credit.

Therefore we see India, that has been receiving a very strong flow of capital from the US for outsourcing activities, that is now sending some of this cash back to the US purchasing cash flow producing properties at a discount price. We also see international investors purchasing notes (debt) or Canadian investors leveraging credit in their own country, that gives loans at only 2.5 % of interest, and use it to buy cash deals in the US.

North American real estate is for sale and somebody is definitely going to buy it at very discounted prices as a long or short term investment using strong currencies or even better weak currencies that get converted into dollars.

According to a research published by the Association of Foreign Investors in Real Estate, the United States are the country that today offers the most stable and secure real estate investment environment:

http://www.afire.org/foreign_data/2009/3.shtm

Of course you must know what you are doing otherwise you will still lose money, and that’s why you should combine your local market or multi-market knowledge with attention to capital flow forces around you to become the specialist that is able to direct them and profit from them.

Roberto Mazzoni

Today I have begun my formal training as a CIPS (Certified International Property Specialist) which is the official US designation for Realtor that are specialized in dealing with transactions that involve foreigners and that can also involve properties abroad. There area about two thousand professionals with the CIPS designation throughout the world and therefore I am getting ready to join a very selected group.

One of the first key elements that I have discovered and that I want to share with you is the importance of the Corruption Perception Index is securing the trust of your potential buyer or investor. It evaluates the desirability of a whole nation as an investment platform so it is obviously the first thing the potential investor would consider before even deciding on which property to invest.

As a matter of fact, the first hurdle I have to overcome when talking to my Italian investors is convincing them that the US is a safe place for their money and that they will be able to get their profit back once the project is completed successfully or that they will be able to continue to enjoy the property they have bought for long time to come.

But now I have a new tool that I can use: the Corruption Perceptions Index calculated and published by Transparency International, a non profit organization located in Berlin that calculates every year a sort “transparency vote” for 180 nations, combining different factors like the behavior of government, the ease to conduct business or transactions, the availability of public information and so on.

The United States are classified at position 19 with a 7.5 score, as compared to New Zealand that scores at the top with 9.4 and Somalia with 1.1 at the very bottom. The vast majority of countries score below 5, like for example Italy is placed at position 63 with a score of 4.3. The UK and Germany are respectively at position 17 and 14.

The strength of the US is that it provides a very solid protection on property rights and often very transparent information on past transactions and the market and the overall perception is improving since it has climbed one position since 2006: from 20 to 19, despite the real estate bubble.

So this index can be used effectively to enlighten investors who maybe are thinking in putting their money in some other emerging markets or that reluctant in crossing the ocean.

Roberto Mazzoni

Why should other people listen yo you? Why should they buy services, information, products or properties from you? Because they trust your expertise and good judgment, and because they believe in your ability to lead them in the right direction and to the right path. Half of the job is marketing or promoting yourself and what you have to offer, but the other half, the most important one, is being a leader.

Being a leader is a matter of attitude and not only knowledge.

How much experience do you need to have to be a leader? How many real estate deals or how many seminars should you have in your resume before you can be one? Leadership is not a quantity thing. It is a space thing: how much space are you willing to take responsibility for and how many people do you want to guide? Then you will have the practical experience and the desire and the commitment to know what you need in order to lead other people. But again, your determination and honest desire to serve and help will bring you much further than your technical prowess.

You will be able to find experts anywhere, and they will always know more details than you do, they will always be able to perform a better job than you do and they will have much more experience than you do in their own special sectors. But without a leader they won’t go far and leadership is the scarcest quality out there.

And eventually, it is all a matter of decision, and the action! And I lived it myself. When I arrived in the US almost two years ago, there was no positive evidence that I could have started an international real estate business and make it successful. Few people were willing to believe that investors would have felt confident in sending their money overseas for buying real estate in the US while the future of the dollar and of the overall economy was very uncertain. But they did and they did pretty soon.

There was no positive evidence that I would have been able to acquire properties in a market I didn’t know, that I could have rehabbed them with techniques that were not familiar to me and with trades I had never worked it before, but I did, and several times.

Many people, who had been in this market before me and for much longer, told me that it was impossible for me to sell a house at a profit, but I did and more than once. And I did have many troubles along the way, you can be certain of it. Whole crews would disappear on me. Costs estimate would escalate. Realtors argued that the location, the price and the nature of the houses were not adequate: some would not even care to come and see my houses or get listing contract (an agreement to sell) from me even if they friends.

But all the properties sold (the last one today) and didn’t take long to sell and now I know I can do it again and again and I have more respect also from the investors that have worked with me. But above all, I know that I can make anything else happen because of what I created completely out of my own intention and decision.

And leaders do feel alone and do feel like they have screwed up everything at times. They have no patience with themselves because they want to achieve their goals with no delays, but they are leaders because they stick to it and don’t give up. And in no place else like the US, leaders have their chance of rising from the unknown and lead one or thousands of people. It doesn’t matter the size of your following. It is the size of your goals that makes the difference. I thank all those that have helped me and I thank also all those that have hindered me, because they have given me the opportunity of testing my real nature.

Roberto Mazzoni

P.S. This is dedicated to the leader that is in you. If you like to share your wins and experiences tweet me at twitter.com/robertomazzoni.

Brokers are increasingly more aware of the importance of the Web in the buying process of their customers and some of them, particularly in the high end of the market, are investing more and more on properly designed web sites that provide lot of information to potential customers, while making it simple to browse it and access it.

The home page of the site that has been awarded as the best International Real Estate site.

Baird and Warner of Chicago have just earned an international award provided during the Annual Conference of the Leading Real Estate Companies of the World (LeadingRE). The site has been reviewed in competition with other 63 and it has been defined as the best overall, providing the best property search and the best property adversing. So you might want to check it out www.bairdwarner.com.

My personal opinion about the site is that they have a substantial effort in designing the home page interface that packs a lot of links to inner pages in a very discreet fashion. The site is available in three languages. They did a full translation, it is not some automatic translation that sound funny. And it is therefore truly targeted to an international real estate audience.

Dealing with high end properties, it is easier for them to have a posh look and gorgeous pictures, but yet their model can be copied for any kind of real estate showcasing site. They use a lot of pop up elements to provide access to inner pages and additional information on the property pictures, but it is not a nuisance. They also directly market for new Realtors and agents in the home page, providing access to a special career page that promises substantial training and coaching support. And they also have social media support through Facebook, LinkedIn and Youtube. A very interesting model that is worth checking out.

Roberto Mazzoni

P.S. If you find something interesting in the world of international real estate drop me a line!