Meg White is the former managing editor of REALTOR® Magazine.
Imagine buying a house in a place without multiple listing services, franchises, or real estate licensure. Down payments are extremely high, around the 50 percent mark. The amount you can borrow is based on your age of all things, and after all that, it’s really easy for a renter to claim rights to your house while you’re away, leaving you with nothing.
That’s the environment your average Mexican client is coming from, and many of those same difficulties exist across Latin America. Clearly, language isn’t the only barrier to the real estate transaction for this group.
In fact, Maria Valentin, vice president of strategic markets at First American Title, would argue that learning Spanish should be closer to last on your list of things to do to make your Hispanic customers feel at home.
“It’s not English that’s the issue,” she said during an educational session at the REALTORS® Conference & Expo last weekend. “Real estate is very different across countries...We don’t grow up with ‘real estate Spanish.’ We don’t grow up with ‘escrow entitlement Spanish.’”
Even if you are fluent in Spanish, breaking out your language expertise right away could turn off some buyers, even if you’re speaking their dominant language. Jennifer Castejon, strategic markets director at First American Title, said that many of their Spanish-speaking customers prefer to do business in English.
“Ask them, ‘What’s your preference?’” Castejon told attendees. “You have to allow them to self-identify.”
Of course, some portions of the transaction can be confusing to laymen regardless of their language preferences. Whether you’re explaining the home buying process in English or Spanish, Valentin urged attendees to steer clear of jargon.
“We many times make the mistake of using acronyms,” she said. Customer confidence in the transaction can become degraded, “when people don’t really know what we’re talking about.”
When showing homes to Hispanic buyers, it’s important to keep in mind the influence of family in financial decisions. Within the dominant American culture, parents and other family members only have a significant say in the home buying process if they’re contributing financially to the purchase or if they will be living in the home in question. This is not necessarily the case in Hispanic families.
Castejon explained that people tend to make their individual decisions based on the needs of the smallest cultural unit. In individualistic societies such as the United States’, that smallest unit is one person. But in more collectivist cultures, the family is the smallest unit of consideration.
“It doesn’t matter if you’re putting one dime into the transaction,” Castejon said. She suggested real estate professionals invite the extended family to home showings in order to avoid showing the house many times over. “You need to take all of them at once ... do not exclude them, because it’s going to be harder on you.”
Whether you’re in an area with a large Hispanic presence or not, this is a group that forward-thinking real estate professionals should target for the future of their businesses. Castejon said their proprietary research finds that while 20 million Hispanics are currently within their target homebuying age, many more are growing into this age group. Castejon also said that the fact that this population is quite young when compared with other demographic groups in the U.S. means that their wealth accumulation and educational achievement is bound to increase a great deal in the coming years.
Valentin added that a strong culture of loyalty is another reason to welcome Hispanic clients and treat them well.
“If you do a very good job for one Hispanic family, they will tell everyone about you,” she said.