Real estate agents who speak Spanish have an edge over their competitors, and real estate companies looking to expand into Hispanic and other growing ethnic populations need to do their homework and not treat all home buyers alike.
That was the wake up call given to realty agents today from the results of an ethnic survey commissioned by the Real Estate Center at Texas A&M University. “Home Buying Among Ethnic Groups” examines attitudes and expectations of Hispanics, whites, blacks and Asians.
“Hispanics told researchers that they prefer or need to work with an agent who speaks their own language when engaged in real estate dealings,” Center Associate Director Gary Maler said. “More than any other ethnic group, Hispanics say they feel uncomfortable handling business transactions in English.”
The potential real estate market among Hispanics is sizable, with 48 percent of respondents who do not own a home saying they’ll likely purchase a home in the next two or three years.
The Center surveyed 4,000 Texans in telephone interviews. Respondents included more than 1,800 Hispanics, 880 whites, 772 blacks and 481 Asians. The U.S. Census Bureau projects the U.S. population in 2040 will be 53 percent Anglo and 47 percent non-Anglo.
Of the four ethnic groups surveyed, Hispanics had the least experience with real estate agents and with home ownership. Hispanics are most likely to have never used an agent to buy or sell a home.
Certain home buying behaviors and attitudes are common among Hispanic respondents, such as regarding family as a primary source of information and advice, the survey found. Unlike the other groups surveyed who turn to an agent or broker first for real estate advice, Hispanics are more likely to first consult a parent.
“Real estate agents should think in terms of family, friends and relationships when working with Hispanics. If agents provide good service, referrals from family members should follow,” Maler said.
More than half of the Hispanics surveyed believe it is difficult to qualify for a mortgage and Hispanics are less likely than other groups to consider the home-buying process easy. This represents an opportunity for real estate agents to educate clients about financing options and the real estate process.
Most Hispanics surveyed said they are comfortable buying a home with a small down payment. However, fewer Hispanics said they are willing to extend themselves financially by making larger monthly payments than they currently are making as renters to be able to own a home. Hispanics have the lowest expectations of what they will pay for a home, and are the most financially conservative group of the four ethnic groups surveyed.
Many Hispanics of all income ranges said they prefer an agent who can relate to them, speaks Spanish, has the same ethnic background, is young and has a neat workspace.
All survey respondents said they want the real estate agent to manage the closing process in its entirety. They consider it important for the agent to explain the process, explain contracts, set the right asking price and negotiate on their behalf.
“All home buyers expect the same basic set of real estate services,” Maler said. “However, the delivery and approach used by an agent should vary depending on many factors, including ethnic background.”
Among the specific ethnic-group findings, blacks were more likely to view all aspects of the home-buying process as easy and had high opinions of real estate agents. This group was more likely to think using an agent is a good idea. When they need real estate advice, blacks first go to a broker or agent, then parents and then to a mortgage company. Blacks also think it is hard to qualify for a mortgage loan.
Asians were more likely than the other groups to buy a home in the next few years. They said they’re willing to pay more than their current rent to own a home. Asians had positive views of real estate agents and said they rely on agents for advice and information. Asians are the most likely group to successfully negotiate real estate fees, and they visit the most homes before making a decision.
Whites were least likely to buy a home in the next few years. They are the group that is most willing to pay significantly more than their current rent to own a home. While whites think most aspects of the home-buying process are easy, survey respondents said the biggest difficulty is finding an agent they are comfortable with. Whites think it is a good idea to use an agent to buy and sell a home.
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