The real estate market and the insurance market are intertwined – in fact, “property” is literally the first word in property & casualty insurance. Both are highly value-based, as higher property values require higher insurance premiums to provide adequate coverage. But there’s a bigger picture: the connection between real estate and promoting investment and job creation, where property sales and insurance will then naturally follow.
Host Lisa Miller talks with John Sebree, a Florida real estate leader who is now CEO of the Missouri Realtors®. While stressing that every state has or should have international business, Sebree shares how Florida’s natural connection to Latin American and Caribbean investors and increasingly the Europeans, are netting benefits for our real estate – and insurance markets.
Real estate creation and increased sales create more property insurance sales and activity in related lines, such as automobile insurance. A recent study by the National Association of Industrial and Office Properties (NAIOP) shows Florida’s commercial real estate sector contributed nearly $190 billion to the state’s economy in 2017, the third most of any state in the country.
John Sebree of the Missouri Realtors® talked about the connection between real estate and the economy, something he learned while on a trade mission to Germany with former Florida Governor Jeb Bush, a commercial realtor, while John was with the Florida Realtors®. “He knew real estate wasn’t a widget,” said Sebree about Governor Bush, “and that if we’re going to bring jobs to our states, we need to be able to talk to them about quality of life, cost living, cost per square foot, so there is a natural connection.”
Countries including those in Latin America and the Caribbean are natural markets for Florida, followed by Europe, because it’s relatively close by being within a day’s airplane trip. Real estate drives economic development and the insurance sector is one of the beneficiaries. Sebree said he’s applied the same principle to his current work in Missouri, which is in the center of the U.S., has two rivers servicing coastal ports, and more rail lines than any state in the U.S. The lesson: every state has international interests and potential to develop international markets.
Sebree shared with podcast host Lisa Miller his ideas on how to encourage that international investment and overcome challenges. “Often times, they’re looking for a safe place to put their money,” he said. Rather than focusing on selling property on these overseas missions, he said he focuses instead on promoting jobs and investment, because the property sales and insurance on those properties will naturally follow. Looking at things as economic development opportunities creates more economic development.
He and Miller also discussed the impact of taxes and regulation on attracting economic investment. Florida’s beaches, beautiful weather, navigable waterways for transportation, and no state income tax are all in the state’s favor. Missouri’s selling points focus on its advanced manufacturing and agriculture technology, in which the Show-Me state is a leader, as well as in logistics.
To make it easier for foreign investors to do business in the U.S., the National Association of Realtors® has created a Certified International Property Specialist designation (CIPS). A Realtor that has this designation is specially trained in helping foreign investors through a variety of real estate transactions and related needs. The association’s website (www.nar.realtor) has a master database, sortable by foreign languages spoken by the CIPS Realtor.
Host Lisa Miller noted that with Florida’s economy firmly on the rebound, opportunities abound in the state’s thriving real estate market. That means growing opportunities to supply the many insurance needs related to that real estate growth, too. Needs not just centered on the actual properties, but also the new jobs and related economic input created by real estate activity that requires the protection that only insurance can provide. “Food for thought indeed for those of us with our eye on growing our insurance business,” said Miller.
Links and Resources Mentioned in This Episode:
Commercial Real Estate Packing a Wallop in Florida(from the LMA Newsletter 3/26/18)
National Association of Realtors(https://www.nar.realtor)
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