This is a great vehicle for real estate agents who have friends overseas or property managers wanting to carve a new market. It wouldn’t take much to start spreading the reach of your marketing to places like Spain, Switzerland or Brazil.
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This article was last updated Nov. 14, 2024.
Waltz helps foreign real estate investors buy US property
Platforms: Browser
Ideal for: Agents who work with foreign investors
Initial review: Aug. 2024
Update: Nov. 2024
Top selling points:
• Loan status tracking
• Minimal, transparent UX
• Near-automated LLC creation
• Investor Kit setup
• Compliant and regulated
• Fintech-inspired
Top concern(s):
The company will need to hone its target market of agents carefully as it ramps up its presence because the pool of agents who work with or target foreign investors is shallow. However, that’s because it’s always been a difficult process. Waltz can change that.
What you should know
Waltz provides a digital on-ramp for foreign real estate investors to buy property in the United States. It helps them establish a banking presence, an LLC, gain an EIN, transfer currencies and safely wire funds. While the company will conduct direct marketing efforts to investors, it will work with real estate agents to educate them on its workflow efficiencies and demonstrate that the long-standing administrative hurdles for outside investors only needed a sharp technology solution to be conquered.
This is fintech personified. I’ve long said that the back-end financial processes of buying real estate are the true anchors to shrinking the real estate transaction. This is why cash buys have become more common. The mortgage experience is awful.
Brendan Wallace of Fifth Wall told me in an interview that too many entities make money on the intrinsic friction of financing real estate. Like movie studios finally embracing streaming, only when big banks learn to make money off of the lean digital transaction will it all become easier.
Now think about what it’s like for someone in Tel Aviv or Jakarta to park money in a U.S.-based hard asset. This is what Waltz is out to change. And why not?
One tool Waltz offers to alleviate the vagaries intrinsic to buying a property from outside its country’s borders is its newly released Partners module, which is an odd name for what is actually a deal tracker. (I suppose I should have questioned the lack of one from the jump, but too late now — they beat me to it.)
The tool is another reflection of Waltz’s very lightweight and palatable consumer-driven user experience that provides a simple content panel with each milestone’s status marked as pending, accepted, ordered, clear to close or whatever terminology best reflects the item in question.
Because Waltz is ultimately a fintech solution and the lender behind most of its customers’ deals, it’s the primary source of truth for the deal. This means agents and brokers don’t have to wade through layers of logins or voicemails to find out which conduit has held up the transaction.
It includes an overt call to upload documents and a highlighted list of key dates. Why entities like Bank of America or U.S. Bank can’t accomplish this kind of experience will forever give me reason to believe that “deal friction” is a legitimate driver of revenue.
I understand there will be cynics about a software-driven process that makes it easier for non-domestic entities to buy rental property. The stereotype will fall somewhere in between outright bigotry and frustration with less availability for low-income buyers. But let’s not pretend this isn’t happening in countless, less-transparent ways or that institutional born-and-bred investors don’t hide their real estate ownership stakes in layers of LLCs and shells.
On the contrary, Waltz is a small, nimble Miami-based firm working with individual buyers who are setting up traceable, regulated companies.
Moreover, the rise of decentralized finance (DeFi) is going to eventually upend what we’re used to, anyway. Here’s what Forbes has to say about it:
Today, almost every aspect of banking, lending and trading is managed by centralized systems, operated by governing bodies and gatekeepers. Regular consumers need to deal with a raft of financial middlemen to get access to everything from auto loans and mortgages to trading stocks and bonds.
In the U.S., regulatory bodies like the Federal Reserve and Securities and Exchange Commission (SEC) set the rules for the world of centralized financial institutions and brokerages, and Congress amends the rules over time.
As a result, there are few paths for consumers to access capital and financial services directly. They cannot bypass middlemen like banks, exchanges and lenders, who earn a percentage of every financial and banking transaction as profit. We all have to pay to play.
DeFi challenges this centralized financial system by disempowering middlemen and gatekeepers, and empowering everyday people via peer-to-peer exchanges.
In short, get used to more companies like Waltz driving change, and lifting up the real estate market as they do.
This is a great vehicle for real estate agents who have friends overseas or property managers wanting to carve a new market. It wouldn’t take much to start spreading the reach of your marketing to places like Spain, Switzerland or Brazil.
Users need to verify their identity with multiple forms of ID, images, and even a live video call and selfie. An LLC name is picked for them (otherwise the delay of trying to overly personalize a name would negate the application’s intent) and the Investor Kit is finalized when the banking relationship with Regent Bank is finalized. Users can choose a registered agent or remain the primary contact on the new entity.
Currency preferences get set up and a partnership put in place with Visa’s CurrencyCloud, a “cross-border money movement solutions for banks, Fintechs, FX brokers, corporates, and other payment institutions,” further flattens the process. Funds can be wired, withdrawn and deposited as needed under an established global finance presence.
There are market opportunities here for property managers, inspectors and every other branch of rental industry service provider, as well as the listing agents marketing rental-grade property.
This brings to light one other concern I have on this front: It’s hard for property managers to wrestle decisions and often even simple answers from landlords around the corner, let alone six time zones away. I would like to see some communication best practices shared or at least a bridge plan to span this potential gap, which could even have language challenges at times.
There’s a DocuSign integration for familiar paperwork automation, too. There’s nothing here to scare off an agent new to international buyer representation and, in the interest of tying a bow around it all, know that everything about Waltz lives up to its name. Elegant. Smooth. And more sophisticated than it looks.
Moving money around the world isn’t easy, but, somehow, Waltz does it in only a few steps.
Have a technology product you would like to discuss? Email Craig Rowe
Craig C. Rowe started in commercial real estate at the dawn of the dot-com boom, helping an array of commercial real estate companies fortify their online presence and analyze internal software decisions. He now helps agents and proptechs with technology and partnership decisions and lends his expertise to Inman to review and report on the people and products inciting industry change.
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