With experts predicting that millions of Hispanic households will be purchasing homes in the next five years, the real estate industry has been undertaking various strategies to tap into this growing market.
From developing marketing materials specifically geared for Spanish-speaking consumers to hosting seminars and workshops, everyone from real estate brokers to home inspectors and lenders are trying to woo Hispanic homebuyers.
“It’s a crucial market. It’s an area that’s going to constantly grow,” said Sean Rizzo, director of business development for Braintree-based Tiger Home Inspection, which provides brochures and presentations on the home inspection process in Spanish.
Harvard University’s Joint Center for Housing Studies predicts that the number of Hispanic households will continue to climb within the next 15 years. By 2010, 49 percent of the nearly 13 million Hispanic households nationwide, or more than 6.3 million households, will own homes, the center estimates.
In Massachusetts, the Latino population is estimated to grow to 566,731 by 2010, accounting for 8.4 percent of the state’s population, according to information from the Maurico Gaston Institute for Latino Community Development and Public Policy at the University of Massachusetts Boston.
A quarter of all Hispanics in Massachusetts owned homes in 2003, according to Nancy McArdle, a researcher and consultant for Harvard University who cited information from the U.S. Census Bureau’s American Community Survey.
Bay State companies anticipating the growing numbers of Hispanics are taking steps to capture more of their business. Inspectors at Tiger Home Inspection, for example, have been conducting free informational sessions on the home inspection process at first-time homebuyer workshops organized by local nonprofit groups in eastern Massachusetts for at least two years.
In upcoming weeks, Tiger will do workshops for City Life/Vida Urbana, a grassroots organization that works to preserve affordable housing in Jamaica Plain; Lawrence Community Works, a nonprofit community development corporation; and Chelsea Restoration, a nonprofit group that educates first-time buyers.
The inspection company also provides brochures in Spanish and recently launched a section for Spanish-speakers on its Web site. The section is a mirror image of the English version of the Web site.
The addition of the Spanish section on Tiger’s Web site has proven to be a success, according to the firm. Out of 8,864 hits to the company’s Web site in December, more than a third, or 35 percent, clicked on the Spanish section, said Rizzo.
In November, ERA Real Estate launched Espanol.ERA.com, the Spanish-language sister site to its existing consumer Web site. Visitors can search for homes throughout the country and access property information and office and sales associate profile pages.
“Almost every major company serving the [real estate] industry has some marketing materials in Spanish,” said Gary Acosta, chairman of the National Association of Hispanic Real Estate Professionals, a group that is planning to start up a chapter in Boston.
That wasn’t the case a few years ago when only a few companies were offering bilingual information, he said.
But the industry is realizing that reaching out to the Hispanic consumers can mean more business, particularly in states with big concentrations of Latinos, like California, South Florida and some parts of Texas.
In those states, “if you’re not communicating to the Hispanic market you’re going to be quite limited in the amount of business you’re going to be able to attract,” Acosta said.
And Acosta believes there’s even more of a need for products and services in areas where there is a fast-growing Hispanic population, like parts of Massachusetts, Georgia, Wisconsin and North Carolina.
‘A Lot of Progress’
Carolena Vargas, a Latina buyer’s agent in Massachusetts, has been reaching out to Hispanics through first-time buyer classes and by advertising in Spanish directories that are distributed throughout Greater Boston.
“Once you get started you find out that there is a need out there,” said Vargas, who works in the Arlington office of Coldwell Banker Residential Brokerage.
Coldwell Banker provides material in Spanish, including first-time buyer guidebooks that Vargas gives to clients.
Just over a week ago, Vargas participated in a homebuyer class sponsored by the city of Cambridge that included a Spanish-speaking attorney, mortgage officer and home inspector. Vargas organized a similar workshop through Coldwell Banker in Cambridge about two years ago.
Vargas said a lot of her business comes from “word of mouth” and through her involvement with the Latino Professional Network. Recently, she helped a young woman who she met through the networking group purchase a home, and that woman referred Vargas to her sister and parents, who ended up buying several properties.
Commenting on the importance of reaching out to Hispanic consumers, Vargas said,
“Everybody needs a house, and Hispanics are definitely buying.”
Like Vargas, Haverhill real estate agent Greisy Jimenez has been trying to help Spanish-speaking consumers. Jimenez mails a lot of letters and information to Hispanic residents in the Greater Haverhill area. Two times a year, she organizes seminars for first-time homebuyers in Haverhill and Lawrence.
Jimenez, who works in Coldwell Banker’s Haverhill office, said most of her business is referral-driven. When she bought her Haverhill house in 1994, and two other properties later, Jimenez noticed that there weren’t many Hispanic Realtors and there was “a lot of need” for information in the community.
A study that the National Association of Hispanic Real Estate Professionals did almost two years ago found that the No. 1 barrier to Hispanic homeownership was the lack of information about the home-buying process. Other barriers included shortage of down payment money, limited credit history and language.
In another study that was released at the National Association of Realtors annual conference in November, more than half of Latino homebuyers reported that one of their main barriers to homeownership was finding a trustworthy adviser who could guide them through the home-buying process.
Acosta believes that this type of information “has been absorbed by the industry” and companies are responding with various outreach and educational efforts. Today, organizations like NAR and Mortgage Bankers Association have developed diversity training for their members.
Two years ago, Freddie Mac established CreditSmart Espanol, a national consumer credit education initiative designed to prepare Latinos for the financial responsibilities of homeownership. The financial literacy program provides information on credit and credit management, insight into how lenders assess credit histories and how credit plays a role in achieving financial goals – including buying a home.
“From an educational standpoint, we’ve seen a lot of progress,” Acosta said.
However, one area where more progress needs to be made is in mortgage lending, said Acosta, noting that products that are more flexible and have lower down payment requirements should be established.
Some national lenders, and Freddie Mac and Fannie Mae, offer loans for borrowers who are having trouble with down payments or who lack a credit history. But Acosta believes more can be done.
“There are opportunities for the mortgage industry to develop more relevant lending products,” he said.
