Overseas Property Agents: Is It Time to Change Tactics?

During the overseas property investment boom, agents focussing on investment properties, especially off plan property in emerging markets made loads of money.

But now, as the credit crunch makes off plan property in emerging markets far less appealing to investors, the drop in prices has made it a very good time for people to buy their dream holiday home in the sun.

So is it time for the overseas property agents who have always specialised in overseas property, mostly on off plan properties in emerging markets, -- those that have survived the credit crunch anyway -- to change their marketing strategy to aim more, or at least equally at holiday home buyers.

During the boom, most, if not all agents began marketing their products as investment properties, whether they had previously been investment specialist agents or not.

The boom also led to many new agents specialising in overseas property investment, launching websites and marketing properties on behalf of agents from all around the world on a commission only basis.

Many new agents launched solely to market the investment potential of off plan property in emerging markets like Albania, Montenegro, Brazil, Tunisia and many more. These markets offered the least expensive properties of all, and promised immediate gains and strong rental yields on the completion of off plan property.

It was undoubtedly a lucrative time for the overseas property industry, as property abroad, especially off plan property in emerging markets became one of the most profitable investments around.

Almost anyone who had substantial savings or the ability to obtain finance invested it in emerging market property, because they could purchase it for three times what they could similar properties in established markets like the UK and US.

But that time has gone, almost no-one with any sense is promising immediate or even short-term gains on overseas properties, even on off-plan property in emerging markets. Yet still most agents are marketing solely on investment potential. Even properties in places where investment is being recommended because of rapidly rising tourism, still holiday home buyers aren't being targeted enough.

Property prices have been dropping in almost every country in the world. Though many emerging markets saw growth continue long after the great drop began in the US, UK and other established markets, growth stopped, even in the most promising emerging markets around the end of Q3 beginning of Q4 2008. That said not everywhere has seen falling prices, many places have seen prices holding.

Prices have fallen most in the established markets in Europe, where Brits love to holiday, and many of them will be looking at the drop in prices with a view to picking up their dream holiday home.

Though not an established market per say, Turkey is the best example I can think of: Turkey tourism is going through the roof; hitting over 20million in 2008, and expected to reach 30million for 2009 and the credit crunch caused a small-moderate drop in property prices.

The rising tourism means there are still new off plan developments going up in the country, and these developments are primarily being marketed solely as investment properties.

Don't get me wrong, off plan properties in Turkey are still selling as investments, although not as fast as they were a few months back, and I still think Turkey is one of the best places in the world to invest in off plan property. I'm just saying that agents could potentially increase their sales if they were to broaden their horizons, and dedicate some of their marketing and SEO budgets to aiming at holiday home buyers -- especially on the properties closest to completion.

The same is true for Egypt. While property values haven't fallen in Egypt's emerging market areas like Hurghada, prices are still really low and tourism is rising massively. While this leaves plenty of room for growth and amazing rental yields, making them very good investment opportunities, those falling in love with holidays in Egypt will also see the low prices as an opportunity to buy a holiday home there -- and if they so choose make a rental income as well.

In closing, in the current climate agents have very little to lose by splitting their focus, who knows what they could gain. And it doesn't have to be drastic: why not market holiday homes, but mention their investment potential based on the rental income that can be made when owners aren't using the property themselves. That way holiday home buyers are targeted, and can choose themselves whether to rent it out or keep it to themselves.