Interview: Jacky Teplitzky on the New Normal

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Douglas Elliman associate broker Jacky Teplitzky has a unique perspective on the international home buyers driving sales on the East Coast. Her Jacky Teplitzky Team has sold more than a billion dollars worth of property in Miami and New York, with a special focus on high-end buyers from Brazil, Venezuela, Colombia, Chile, Argentina and Russia. A native of Chile who was raised in Israel, where she served as a sergeant in the Israeli armed forces. In a wide ranging interview, she talked to WPC about the recent changes in the market and doing business in the new normal.

What is not getting reported about the international business right now?

I think what isn't being reported is that everyone is going back to real estate. Real estate was like a bad word in 2008 and 2009 because of the crisis and everybody was trying to find other vehicles for investment. They were buying gold. They were going back to the stock market. Now we are seeing a comeback of people investing in real estate.

I think everybody believes in a more tangible asset that you can actually touch and see and that's real estate. At the end of the day, yes we have ups and downs but we all known people have to live somewhere and in the long run the asset will appreciate.

What is different about the interest in real estate?

The interest has completely changed. Before it was mainly Europeans. Before the credit crisis we saw English, Irish, Spanish.

Now we're seeing, number one, is Brazilians in Florida. But Brazilians are also buying in New York. Number two are Argentinians buying in Florida and New York. Number three would be Venezuela. And, of course, each country has completely different reasons for why they are coming here. And then there are the Russians, don't forget the Russians.

Why they are coming here? Second homes? Investments?

All the above. The first thing was for their own use. Then they moved into investment property, residential. Now we are getting more inquiries about commercial property. They're asking about hotels. They are asking about office buildings. They are asking about retail.

How has it affected your business?

Well, first thing, is I just added a commercial person to my team. And I am educating myself at a very fast speed about the commercial market here in Florida and also in New York. People look at you as a one stop shop. If they trust you in one item, they want you to trust you on others, so you have to be able to give them the service.

The second part is, I added people who speak different languages. I myself was born in Chile and raised in Israel so I speak four languages. But within my team we speak seven languages. So I added a Portuguese speaking person, I have a French speaking person. The whole idea is that real estate in the United States is becoming much more international.

How would you compare activity now to prior levels?

Price wise we are not at 2006-2007 levels. But activity-wise, I would say we are definitely going back to those years. But it is a different type of buyer. In '06 and '07, if you had a body temperature, you would get a mortgage. You could put 5 percent down and then you would get an apartment or investment property. Now you have to put in much more equity. You have to put between 20 and 30 percent equity. Not a lot of people have 20 to percent equity. South Americans are buying all cash, which is creating a problem for the local people who are living in Florida and living in New York. You are basically competing against the foreign buyers who have all cash and can close in 30 days. American buyers need a mortgage and it is still not easy to get a mortgage and they need more time to close.

Are you seeing bidding wars?

Absolutely. There is no inventory. In South Florida there was speculation it would take eight or nine years for the inventory to get absorbed. And here we are three years alter with no inventory. In any price level, in any area.

There is assumption we're only talking about luxury property with no inventory.

In all categories. And it is happening in New York the same way.

How do you reach those international buyers?

You need to build a referral business. If you do a good job for one person, that person talks to another person. The other way is to have contacts with local people in different countries, the people who manage the wealth on behalf of these people--the bankers, the estate planners, the lawyers.

How do you reach those people?

You have to do research. You see which are the private bankers who are stronger in South America and you can build a relationship. But this takes time. It doesn't happen overnight.

Anything else about the market that might surprise people?

I would say there is much less inventory than anybody thinks. Everybody thinks that we as brokers are saying there is no inventory to create hoopla. Lot of people think there is a lot of shadow inventory. But the truth is there is not a lot of shadow inventory. What we are saying is the truth.