Estate agents with foreign buyers boost their revenue
Estate agents in prime residential spots especially in London will know the importance of foreign buyers to the property market. Significant amounts of money have been pouring into prime real estate for years now in London as the world seeks capital safety and returns above the zero interest rates that central banks have set around the world. Indeed in recent years foreign purchases have accounted for around half the entire market for prime London residential property.
Estate agents and brokers have for too long ignored an additional importance of foreign buyers to their revenue streams. Significant foreign money inflows require large foreign exchange transactions which need to be safe, secure and of course cheap.
Traditionally property buyers have used their local banks to do the exchange, perhaps also an independent foreign exchange broker but never has there been the competition among money transfer firms fighting for a share of this business. This is great news for the property buyer who no longer has to pay the very high fees that their local bank will charge (often as high as 4 or 5% of the notional money being exchanged) but there is an added upside here for the estate agent involved in the property transaction as well. Companies like www.exchangefair.co.uk will pay a healthy commission to the estate agent if they recommend the service to their buyer for their foreign exchange transaction. In fact, the upside can be huge, we ourselves have seen payouts to estate agents for referral fees that have come in higher than the fees and charges they traditionally charge for their property transaction!
In our experience the foreign buyer referral service has been nothing short of a real turbocharge for estate agents trying to maximise not only their bottom line but also of course, the all-in-one service they can provide for their buyers.
In fact, volatile exchange rates recently (post-Brexit, Trump) which have seen Sterling weaken to a multi-decade low against most major currencies have seen a decent pickup in not only foreign interest in buying effectively cheaper Sterling denominated property stock in the UK, but also British buyers of foreign property stock wanting to cash in their profits on their homes and investments abroad. For example, if you bought a house in Euros just before Brexit, assuming the house value hasn’t moved in Euros, you’ll be sitting on a healthy 10%+ paper profit given the weakness in Sterling, should you wish to sell that house and repatriate your proceeds back to Sterling. In turn, the opportunities for estate agents with a presence abroad abound for the British expat market.
So in practice how does a referral work? Its easy. To sign up with a money transfer platform like www.exchangefair.co.uk that offers this commission-based service, you’ll only need to agree to an online based contract which obligates the firm to pay an agreed upon percentage fee to the estate agent on every successful referred transfer. Once a buyer or seller expresses an interest to buy or sell property the estate agent recommends the money transfer company name and gives them a special link to sign up to the service and any transaction from that individual will be recorded and the agreed commission will be paid once the transaction completes. It’s important to note also that such a referral program isn’t just for individuals, the system works equally well in the same way for companies too, both small and large. So commercial property transactions that require a foreign exchange transaction can equally turbocharge the commercial property estate agent’s bottom line as well.
What does the customer need to do? Really very little. A platform like www.exchangefair.co.uk is extremely easy to use. As per statutory financial law due diligence will need to be done on the customer which typically involves taking a photocopy of their passport or other identification and some proof of address. Typically this due diligence process takes minutes, if not even seconds. With today’s technology, both an individual’s and company’s details can be automatically verified in seconds with no further input from the customer. The customer once signed up can then trade online if they so wish or with larger transactions a dedicated agent is available to enable them to make the transfer over the phone. The deal is then done and the money transfer firm gets to work dealing with the wholesale currency markets and physically moving the money. The money can be transferred directly from the buyer’s bank account to the seller’s bank account or the buyer may just wish to transfer from his say Euro bank account to a Sterling bank account and then take charge of the transfer to the buyer or seller himself from there. Typically, any type of money transfer process is catered for. Indeed we’ve even seen 3 currencies involved! A buyer could be buying in Sterling, having Euros to convert and the money needs to be held in an estate agent’s account in another currency! Any solution is accommodated. For most major currencies, funds are typically cleared and moved from one account to another in about a day, so the process is quick and indeed painless. A firm like www.exchangefair.co.uk will also have a 24 hour dedicated telephone line where the customer can phone in case of any questions. The platform also automatically sends emails and text messages to the customer as the transfer process progresses as well.
For the estate agent keeping track of their growing commissions, an online login is provided for them to see successful referred transactions. All information is accessible and agreed commissions are usually payed within 1 day of the successful customer transaction.
All in all, estate agents, perhaps especially those facing squeezed margins on their traditional fees are finding the foreign exchange market a welcome friend at the moment. With geopolitical uncertainty on the rise and macroeconomic factors ever adding to an already volatile currency market, the opportunities from the foreign exchange market for estate agents will continue to increase in the months and years ahead.
For more information of the firm feature in this article, ExchangeFair Ltd, please visit www.exchangefair.co.uk or call 0845 226 8129. ExchangeFair Ltd is regulated by the Financial Conduct Authority as firm number 750503.