What are the strategies, challenges, and opportunities that real estate professionals are facing so far this year? Let's find out what Properstar agents have to say about the current state of international and local real estate markets, emerging trends, and changes in the buying process for 2023.
Agents are our local experts and ambassadors
This fall, in our annual agent survey, we approached Properstar real estate agents who work in four major markets: Spain, Portugal, France, and North America. These frontline experts are valuable sources of insight, and they have provided us with a firsthand perspective about their experiences this year. Let’s find out what they had to say!
A balanced real estate market
While 62.8% of agents anticipate the continuation of a balanced real estate market for the remainder of 2023, it's essential to note that this balance comes with underlying implications. A balanced market is characterized by stable home prices, reasonable selling periods, competitive (yet negotiable) offers, a moderate inventory and, to some degree, reflects the evolving mindset of today's homebuyers. It is not merely the result of supply and demand equilibrium, but also is influenced by socio-economic factors, consumer confidence, and political considerations.
In ranked order, here are the factors that agents believe have impacted the 2023 real estate market the most:
1. Purchasing power: increasing inflation, interest rates and/or regulations2. Affordability: home prices, mortgage rates and wages
3. Availability: property inventory levels and market supply
4. Consumer confidence: changes in the housing market, political unrest and personal economic status
5. Economic drivers: Gross Domestic Product (GDP), employment, manufacturing activity, price of goods etc.
Agents in our survey believe that the purchasing power of customers has had the most impact in the market so far this year.
Agent Insight
Agents in Portugal and Spain place a higher concern about affordability in their markets than do agents from the other surveyed countries.
Agent observations about change in the market
We asked agents if they noticed any other important factors that impact the real estate market and they had a lot to say. Let's take a look at the top four issues that agents raised, regarding their business practices.
Financing
The challenges related to financing are clear, with agents highlighting the stringent conditions imposed by financial institutions, the fluctuating interest rates, and the currency's value in individual countries. One agent aptly notes that obtaining a car loan may be straightforward, but buyers wanting to secure a mortgage seem to face increased rigidity from banks. Almost a quarter of all agents surveyed, had something to say about financing being a challenge for their buyers. Agents emphasized that their businesses have been notably impacted because of this.
Governance
Survey results tell us that agents and their clients are wary of Governance issues, which can significantly influence the real estate market in several ways. One agent said that this has killed buyer confidence! Inconsistent regulatory policies can create ambiguity and discourage investment. Uncertainty within governing bodies can erode trust and deter foreign investors. Additionally, zoning restrictions and land-use regulations can either stimulate or hinder property development, shaping the overall market landscape. Finally, tax policies and legal frameworks can impact property transactions, affecting buyer and seller behavior.
Competition
Competition among real estate agents can influence several outcomes in the real estate market. Increased competition may lead to more aggressive pricing strategies or may even lead to cutthroat practices and undercutting, which could destabilize market equilibrium. About 11% of agents who offered feedback stated that this is their concern. In a positive light, another outcome of high competition could result in improved service quality and innovative marketing techniques as agents strive to distinguish themselves in a crowded field. Finally, competition can encourage real estate professionals to stay updated with market trends, which can foster market efficiency and transparency. This is where Properstar aims to support our agents.
Pricing
Pricing in the real estate field can wield considerable influence on the market dynamics, and agents have noticed! Accurate pricing can expedite property sales and maintain market stability, whereas overpricing can lead to stagnation and deter potential buyers. Market-driven pricing strategies may foster fair competition and attract a diverse pool of buyers. Nonetheless, price manipulation and speculation can distort market conditions, leading to bubbles and crashes.
Pricing in the real estate market is often determined by a complex interplay of various factors, extending beyond the influence of individual agents. Market conditions, supply and demand, economic indicators, and even global events can collectively shape property prices. While agents play a pivotal role in advising clients on pricing strategies, the broader market forces exert significant sway in establishing the final valuation of properties.
Agent Insight
Unlike previous years, agents did not express significant concerns about technology advancements in the real estate industry in 2023, indicating their growing familiarity with the upsurge in technological changes driven by the COVID-19 pandemic.
Agents this year have predominantly dealt with shifts in financing conditions that affected buyers, governance decisions that rippled through the market, heightened competition, and the multifaceted nature of property pricing. These concerns are a part of the evolving intricacies of the real estate sector this year, but we also saw some new concerns being brought forward by agents, that involved generational and social changes.
Supporting international real estate professionals
In the dynamic world of international real estate, continuous learning is key. We're committed to providing educational resources like webinars, videos, articles, and more to help you stay informed about current market trends. Plus, don't forget that your agent dashboard is your gateway to useful tools, including listings promotions, a marketing kit, an improved agent profile, and more.
Agent Insight
Your input helps us improve our support and services, to better meet your needs. A big thank you to all the agents who participated in our survey.
In general, the consensus among agents is that the real estate market displayed a degree of resilience, with results consistently hovering slightly above the midpoint of the scale – positioned between ‘Resilient' and 'Somewhat Resilient.'
Among the surveyed groups, French agents held the most cautious outlook, with their survey results falling just below the balanced mean. In contrast, Portuguese agents expressed the most confidence in the market's resiliency, with North American professionals closely following suit.
These findings underscore the reality that while each country faces its unique challenges, market-dependent variations persist, shaping the diverse landscape of real estate experiences and expectations.
Agent experience with local buyers in 2023
Overall, the survey results highlight a range of local buyer activity trends, including declines, stability, and increases, varying by country. These trends provide insights into the evolving real estate market dynamics and agent experiences across different regions.
All markets reported a decline in domestic buyer activity so far this year. French agents reported the highest rate of decline, with almost 63% of them experiencing a reduction in local buyers.
In Portugal, 34.3% of the polled agents indicated that local buying activity remained balanced compared to last year. In Spain and the United States, about 22% of agents experienced no change in the amount of local buying activity so far this year.
Spanish agents reported the highest increase in local buyer activity. The average for all polled agents who indicated an increase in local buying activity is 16.4%.
All markets indicated that there have been significant changes in their localities this year, compared to last. This is no surprise, as we know that the real estate market has been on a slowing pattern.
Foreign buyer interest in 2023
As the global real estate market keeps changing, agents know that it is crucial to stay adaptable to new trends and challenges. In the past year, there has been a significant shift in how buyers are approaching the market. This change is driven by factors like economic variables, remote work dynamics, and evolving lifestyle preferences. Because of these changes, governments and industry experts are closely watching market developments. We've reached out to real estate agents to better understand how these shifts are affecting the interests and behaviors of foreign buyers.
Did foreign buyer interest change in 2023?
Spanish agents reported the highest increase in foreign buying activity so far this year, at just over 56% of them experiencing more foreign clients.
In the past year, foreign buyer activity in the real estate market has shown varying trends across different countries. In Spain, foreign buyer activity decreased by 12.7%, whereas it decreased in France by 30.4%. Meanwhile, Portugal saw a notable increase of 32.1% in foreign buyer activity. US and French markets experienced mixed changes, with increases of 33.9% and 9.8%, respectively. On average for all markets, 32% of agents reported that they saw no change with foreign buyer activity in the last year.
For agents actively utilizing the Properstar platform, business hinges on reaching a global audience of buyers. Our survey revealed that a substantial 33% of their business is now attributed to foreign buyers, marking a significant 7% increase from the previous year's findings. We are committed to providing agents with the necessary tools and support to effectively manage these leads.
The role of foreign buyers in real estate
For agents on the Properstar platform, reaching a global audience of buyers is important for many in the business. Our survey results show that 33% of agents report business with foreign buyers, showing a noteworthy 7% increase from last year.
Agent Insight
As local markets face a slowdown, turning to the international real estate market can be a savvy move, offering fresh opportunities and a broader pool of potential buyers to help navigate through the challenges of a sluggish local market.
Trends in buying and selling
In our 2022 survey results report, the key concerns for buyers and sellers involved technology updates, lending processes and sustainability. We asked agents how the real estate landscape has evolved with regard to how people buy and sell properties in 2023, and here is what they have to say:
#1 Business Conduct: Below is a summary overview of how business is conducted in each of the markets where we polled agents.
Spain: In the Spanish real estate market, business is characterized by a dynamic mix of international and domestic buyers. The market offers a diverse range of properties, from coastal resorts to urban apartments. Agents in Spain often prioritize multilingual communication to serve a global clientele, with a focus on technology-driven marketing and property presentations. Spain is known for its lifestyle appeal, attracting buyers seeking both vacation homes and investment opportunities.
Portugal: The Portuguese real estate market has gained popularity in recent years, especially among foreign buyers seeking affordability and natural beauty. Real estate in Portugal emphasizes a range of property types, from historic city apartments to coastal villas. Agents prioritize multilingual services, technology integration, and online marketing. Portugal's Golden Visa program continues to attract international investors, contributing to its growth.
France: France's real estate market is marked by its diverse and historic properties, from châteaux to Parisian apartments. Agents in France often work with both local and international buyers, with an emphasis on providing personalized service. The market showcases strong demand for lifestyle properties, and agents leverage technology for virtual property tours and global marketing campaigns.
North America: Encompassing the United States and Canada, this continent features a robust and multifaceted real estate market. Business practices vary by region, but overall, agents emphasize market expertise, technology-driven marketing, and transparent communication. Canadian markets prioritize bilingual services, especially in regions with significant French-speaking populations. The North American market caters to a wide range of property types, from urban condos to suburban homes.
Each of these real estate markets present unique opportunities and challenges, reflecting local customs, buyer preferences, and regulatory environments. Successful agents in each region adapt their strategies to align with market dynamics and deliver exceptional service to their clients.
Agent Insight
In a slower or balanced market, sellers often approach their transactions with a more cautious and patient mindset.
#2 Pricing strategies: Last year, we saw a lot of competitive and premium pricing strategies. However, with the 2023 market slow down, it is more common to apply discounted pricing. An example of this is if similar homes in the area are listed at $400,000, a seller might choose to list their property at $375,000. The discount creates a more attractive value proposition, potentially drawing in more buyers and price improvement strategies. Another tactic is the price improvement strategy, where a property is initially listed at a price slightly above the expected market value, and then gradually reducing the price over time. By doing so, the listing remains fresh in the minds of potential buyers, and the gradual price reductions can create a sense of urgency. In a slow market, sellers may also want to focus on improving the property's condition, staging it effectively, and marketing it more aggressively to stand out from the competition. A real estate agent who understands the local market dynamics can be invaluable for navigating a sluggish market and choosing the most appropriate pricing strategy.
#3 Seller Preferences: Sellers typically favor several key factors when selling their homes, and these preferences can be influenced by personal, financial, and market-related considerations. First and foremost, they seek to maximize the sale price, aiming for the highest possible value, as do agents! Agents with a deep understanding of local market dynamics, including trends, neighborhood nuances, and pricing strategies, are considered essential for a successful selling experience. It's important to note that individual seller preferences can vary widely based on their unique circumstances, motivations, and the local market conditions. A skilled real estate agent works closely with sellers to understand their specific goals and priorities, tailoring the approach to meet their needs and maximize the likelihood of a successful sale.
#4 Client communications: Real estate agents use various methods to communicate with their clients, and the popularity of these methods may vary depending on the agent's style and the preferences of their clients. These can range from phone calls, email, text messages, in person meetings, video conferencing, social media, mobile apps, etc. These expectations reflect the evolving real estate landscape, where buyers are increasingly tech-savvy and agents who can adapt to their preferences and needs, are valued. Successful agents today utilize a mix of traditional and modern communication styles to meet these expectations and provide exceptional service.
What are buyers looking for?
To gain insights into buyers' preferences, we turn to our informed agents who have their finger on the market's pulse. Agents have observed a notable surge in demand for residential properties situated near major urban centers. Following closely in survey results, there is a growing interest among buyers to transition away from bustling city life. Additionally, the desire for second homes or vacation properties ranks third, with properties in suburban areas rounding out the preferences of today's buyers.
Portuguese agent observations
Portugal agents report that the main areas of interest in the market so far this year include Porto, Lisboa e arredores, Vila Nova de Gaia and Algarve & Setúbal (who come in at a tie for fourth place) in popularity. Agents tell us that they have been doing business in Brazil, followed by some activity in the EUA and South Africa. Portugal and Brazil maintain a positive relationship that extends to real estate, property and investments. Agents also report that beaches and coastlines remain in demand, as well as in the interior regions near major cities, which provide a vibrant blend of commerce and industry for prospective homebuyers.
United States agent observations
Agents from North America report that they have been doing international business for clients looking for property on the western coast of South Africa. Next in popularity for their buyers are Australia, Türkiye and Dubai. For local buyers in North America, states of interest are Texas, Florida, New York and California. The state of Texas boasts a large population and a rapidly growing job market, making it a prime choice for real estate investment opportunities with cash flow from rental income.
French agent observations
French agents indicated that they have been doing business in Switzerland, Germany and Spain so far this year. The local real estate hot spots for French agents are Nice, Marseille, Bretagne and Occitanie. A prevalent trend observed among buyers is their preference for medium to small-sized towns, ideally with convenient access to local shops and train stations. It may be beneficial for you to keep your eye on the south-west area, as properties here offer a unique blend of accessibility and seclusion. They are conveniently located with good access to airports and road networks, yet they are distinct from urban properties, providing a sense of privacy and security. Furthermore, there is a strong desire for the advantages of purchasing a holiday home here, which can lead to high occupancy rates and competitive rental rates.
Spanish agent observations
Spanish agents have primarily focused on local real estate transactions, with some also engaging in business activities in Italy and the United States. The top four locations drawing buyer interest include Madrid, Barcelona and its surrounding areas, Valencia, and the enticing island of Tenerife. Coveted location characteristics for properties include proximity to beaches, suburban settings away from urban centers, and ample open space. Spain offers a wealth of options for homebuyers, ranging from the Pyrenees to the Mediterranean and all the way to the Atlantic. The diversity of choices in Spain extends far beyond the cultural aspects, providing a multitude of opportunities for prospective property owners, and for agents!
Agent Insight
Almost 65% of agents surveyed, indicated that they are likely to recommend Properstar and the ListGlobally International network to their clients.
Properstar and agents
This year, Properstar platform has undergone a brand refresh and revitalized its communications with agents, so we are keen to understand the current landscape for our valued partners. To that end, we've included a few essential questions in our survey that will help us gauge the extent agent engagement with Properstar and ListGlobally.
In our survey, we discovered that a significant portion of agents are actively utilizing Properstar resources to enhance their real estate services. Notably, 21.5% of agents are leveraging the Listing report, while 18.8% find their Agent Dashboard an indispensable tool. Furthermore, 17.4% of all surveyed agents have tapped into the potential of listing promotions, whether they choose the Elite, Luxury, or Global category. There is certainly room for more agents to discover this feature and we hope this article inspires you to do so.
When we explore regional trends, it's interesting to note that agents in Portugal and North America lead the way in employing listing promotions, with an impressive 38% and 35% respectively, benefiting from these boosts to elevate their property listings.
Properstar, sellers and buyers
When we asked agents about their knowledge on consumer-facing features and services on the Properstar platform, almost half of them indicated they needed to familiarize themselves better with these features! When agents are aware of the great features available for their clients, it not only benefits them, but also enhances and informs their clients’ buying or selling project. These features include; saved searches, price change feature, drawing on maps home search, blog content and the Properstar app.
For those agents that were familiar with the services and features for their clients, the Portuguese agents were the most informed about Saved searches and the price change feature, while the French were most familiar with Drawing on maps.
By gathering these insights, we can better align our offerings with your needs and ensure we're on the same page in our mission to empower real estate professionals and make the buying journey easier. For a complete overview of Properstar feature for both agents and clients, read Empowering agents, buyers and sellers.
Spread the good word
We know that Properstar platform has something for every person involved in a real estate transaction; from buyers, sellers, and renters to agents, agencies, franchises and developers. Almost 65% of agents surveyed, indicated that they are likely to recommend Properstar and the ListGlobally International network to their clients. This is great news! Personal recommendations have a tremendous influence in the real estate industry, instilling confidence in both buyers and sellers. When someone you trust endorses a service or product, it carries an inherent credibility that can't be easily replicated. This word-of-mouth endorsement isn't just about sealing deals; it's a testament to the trust and rapport that agents build with their clients and provide a solid foundation for enduring relationships and a thriving real estate business.
More about Properstar
Properstar is the largest global property platform in the world and has been connecting sellers and buyers through a large network of qualified agents since 2018.
We stand as a global leader in online listing publishing. Collaborating with over 100 property portals in more than 60 countries, Properstar enables agencies and developers to reach an audience of over 150 million potential buyers and investors.
