Pitching for foreign projects
As the property market enters a wintry mood in Hong Kong, real estate agents are increasingly turning their attention to foreign sales. The new generation of professional classes in the region is even more cosmopolitan that the last, and their eyes are on property in parts of the world perceived to have a relatively high quality of life, most of them variously eyeing property investments, second homes, homes for children studying at overseas universities, and retirement domiciles.
'In terms of the residential sector, sales of foreign units to Asian buyers have increased tremendously over the past two years, favourite destinations being London and Sydney,' says David Watt, international director and head of business developments and client services for Asia Pacific at DTZ. 'The main buying groups have been high-net-worths from Hong Kong, Singapore, Malaysia and, more recently, mainland China,' he adds.
Agents require very specific, additional skills to be able to make foreign sales. 'It is important that the agents have both a good understanding of the markets in which the properties are located, and of the preferences and customs of the foreign buyer,' Watt says. 'For those agents who can bring both sets of skills to the table, as well as being a good salesperson, there are plenty of opportunities for employment.'
The importance of local market knowledge is advantageous. 'Examples would be locals who have worked in the London or Sydney markets. Even if they have just been students there, a short course with the residential sales team in that market can bring them up to scratch,' Watt says, adding that sales teams are often built around people who combine unrelated but complementary skill sets.
'Often, these skills or market knowledge can't be found in a single person, so we see teams that combine foreign market knowledge - often by employing an expat - coupled with good local salespeople who know their buying customer,' he says.
An executive at another major global property player concurs with this view. 'Yes, there is an increase in interest. In Hong Kong, we have a designated international properties desk. And we've seen a significant uptick in offshore interest,' says Richard Kirke, managing director of Colliers International Hong Kong.
'One driver of this is that many of our buyers have children in universities in the markets they're being in, that is to say, Canada, the UK and Australia, principally. And these three places are being marketed to buyers in Hong Kong and Singapore,' he adds.
The Colliers approach in offshore markets is, as Kirke explains, pragmatic. 'To minimise problems and communication difficulties, we will partner with someone in the target territory to guide us through local requirements,' he says.
As to whether agents need additional skills to be able to make foreign sales, Kirke says: 'The skill-set is the same. But agents do need to educate themselves in those offshore markets.'
Knight Frank, the multinational real estate and property service firm, has long enjoyed a strong presence in the region. Seb Warner, the company's Asia-Pacific regional director, also sees strong growth and potential for overseas sales.
'These are exciting times. We've consolidated and improved our sales teams across Asia. We also have a brand new team in Shanghai. We have developed our teams in Hong Kong, Singapore and Malaysia to deal with new and exciting market realities,' Warner says.
He affirms that interest in offshore markets is growing. 'The focus among Asian property investors is London. It accounts for around 90 per cent of inquiries from potential buyers,' he says.
Listing the requirements required for an agent to make sales in the British market, Warner notes that local knowledge is by far the main factor.
'Some of our people from here have studied in London, so they are highly prized assets. A good and firm understanding of property law in the United Kingdom is also very important,' he says.
In conclusion, property agents do not appear to face insurmountable barriers to entry to any overseas market. But they do need to be knowledgable about the jurisdiction they intend to sell in - or be prepared to learn.
There also appears to be demand at present for competent sales agents with the appropriate language skills for offshore sales, according to industry sources.
'King's Road London might soon be an easier sell than King's Road, Quarry Bay,' says Warner.
The possibilities are certainly worth pondering.