Tips for Working With International Clients

Dealing with international clients comes with challenges, but can open your business to a brand new customer base

By Andrew Conner

Taking great care of any real estate client means building a trusting relationship and communicating clearly.

While this doesn’t change when your client happens to be halfway across the globe, there are challenges presented when you represent an international client. Whether it’s understanding the customs and the way business is done in a different country, or simply adjusting to the time difference, here is some advice from agents about how to successfully work with international clients.

The culture connection

Building a working relationship with an international client can have many intricacies. However, the first issues you will likely run into are the most obvious: cultural and time zone differences. “That is probably going to be your first breakdown, if you can’t all get on at the same time,” says Diana Galavis, CRS, broker-associate with Watson Realty Corp. in Jacksonville, Florida.

Galavis explains that the pandemic actually made this aspect of working with foreign clients easier, with Zoom making the world smaller and enabling more face-to-face interactions. But she says you must be prepared to talk on camera. “Make sure you dress professionally when your camera is on,” she says. “And do research, so you understand what may be customary in their neck of the woods.”

Galavis points to the book “Kiss, Bow, or Shake Hands” as a great resource for learning about business customs in other countries. Mark Kitabayashi, CRS, managing broker at Windermere Real Estate Puyallup Inc. in Puyallup, Washington, also recommends the book, and explains how important understanding customs can be.

“A good example is negotiating,” he says. “Usually in the U.S., we submit a purchase and sales agreement as an offer and then that is signed and becomes a contract—and we don’t negotiate from there. In many countries, you don’t sign the final purchase and sales agreement until the closing table. And if you don’t educate your clients about that difference, they can get frustrated when they want to keep negotiating.”

Kitabayashi also points to the concept of low context vs. high context cultures as being a helpful shorthand for how to engage with international clients. “Low-context cultures are like the U.S.,” he explains. “Once you have a contract or agreement, that’s the law. In high-context cultures, it’s more about the relationship, and the contract is just part of that relationship.” Knowing what is more common in your client’s country will help you better identify which topics and customs might need more explanation.

Building a team

Just as your clients rely on you to be an expert in real estate, you need to rely on experts in other fields to help support transactions. And this is even more important when working with international clients. “You definitely need to vet the people you’re working with,” says Galavis. “You don’t want your client to be the first international client they’ve worked with.”

For attorneys, accountants, consultants or even interpreters you may be working with, Galavis recommends looking at their experience: “You want to know if they have knowledge of the specific country you’re working with, you want to know how much international business they do and you want to make sure they can work the same hours you’ll be working because of the time difference. You also want to make sure they understand that sometimes international clients might need special attention.”

Kitabayashi suggests working with REALTORS^® in your company or in your area who have experience in the country you’re working with—if they’re available. “Rather than a translator, I’d find a REALTOR^® who knows the country and does business in that country, and then you know they will have resources that will help. [For example,] a good friend of mine is a top producer in the area who deals with foreign buyers. She deals with a lot of Chinese buyers, so if I needed help with a Chinese transaction, I would go to her.”

Both Galavis and Kitabayashi agree that you should always choose the right person for a specific transaction. Neither have a dedicated “team” of international experts that they always work with. “You might have five different attorneys with whom you work regularly, and each specializes in a different country or region,” says Galavis.

Navigating legal waters

As agents are well aware, many legal and tax issues can crop up during real estate transactions. Naturally, these issues can be amplified when dealing with international clients because you now have to be cognizant of the law in another country. While there is not a lot of general advice on tax and legal issues for foreign clients—it varies from jurisdiction to jurisdiction—there is one accounting concern that all agents dealing with international clients should be aware of: the Foreign Investment in Real Property Tax Act (FIRPTA).

Under FIRPTA, foreign persons selling U.S. property are required to withhold a certain percentage of the amount of the sale—usually 10%–15%—to ensure that taxes are paid in the U.S. For agents, the most important action to take regarding FIRPTA is informing your clients about it.

“FIRPTA doesn’t affect the international buyer on the front end, but if they are ever interested in selling the property, it can be a big concern because taxes will have to be withheld,” says Galavis. “If you’re the agent working with them, and you don’t let them know and they find out when they’re going to sell the property, they may not be happy about that.”

Galavis adds that being aware of exchange rates can be helpful, not just when selling property and FIRPTA comes into play, but also to ensure your buyers aren’t hit with a larger cost than they anticipated due to fluctuations in currency.

A foundation of education

If you have international clients or are thinking of representing them, a great way to get started is to educate yourself. Look no further than the resources RRC has available—the Council offers numerous recordings on its Education Catalog for those REALTORS^® who’d like to sharpen their skills for dealing with international buyers and sellers.

For example, Kitabayashi presented a course that’s featured on the CRS website, “Understanding Culture to Help Your International Business,” which will help you avoid cultural faux pas and keep international clients happy.

There are other educational options beyond the Council, as well. Galavis, Kitabayashi and Hollie Himmelman, CRS, broker with @properties in Chicago, Illinois, are all Certified International Property Specialists, or CIPS. Himmelman explains that taking the course has helped her be better prepared for foreign clients.

“I’m a huge believer in continuing education,” she says. “I like to keep learning. The CIPS course is a great overview and very immersive. I think if you want to get involved, it is a great starting point to leap off from.” After that initial overview, Himmelman recommends getting involved in local real estate organizations and leaning on your company or brokerage, if you have one. “Via my brokerage, I have global connections. And if you want to learn and participate, there is an opportunity.”

As Himmelman notes, CIPS is just a starting point. Once you get your foot in the door for international business, you’ll only gain more experience and be able to provide more value to your clients. With foreign investment in U.S. real estate booming, there has never been a better time to brush up on your international business skills.

For more information on dealing with international clients, check out “Understanding Culture to Help Your International Business” on CRS.com/webinars.

Photo: iStock.com/Cobalt88