Real estate is an investment category that your wealth management customers engage with repeatedly throughout their lives. Below we discuss how you can incorporate it holistically into your advisory processes—to strengthen the customer relationship and establish new revenue opportunities.
On a financial level as well as an emotional one, no other investment occupies customers as intensely as owning real estate. No wonder, then, that in many advised clients’ portfolios real estate is the largest and most long-term asset class.
Wealth management providers have recognised the advantages of integrating real estate data into customer interactions as a core element of the advisory process. This can bring benefits such as:
- Improved customer engagement and customer satisfaction
- Stronger customer relationship, loyalty and retention
- Up- and cross-selling potentials
In this article, find out how this integration can succeed and how real estate data contributes to the long-term future of wealth managers.
Real estate emerges as one of the most relevant customer experience trends
In times of digital banking, FinTech, price wars in retail banking, high product comparability and rising customer expectations, the competitive pressure within the wealth sector is ever rising. Well thought-out products alone no longer guarantee customer loyalty. In order to stand out in this challenging market, it becomes increasingly important to optimise the customer experience. A decisive factor: Whether and to what extent financial advice providers are able to generate added value for their customers, both in terms of service and the quality of the advisory process.
This is confirmed by a PwC study, among others. It showed that an overwhelming majority, 65% of those surveyed in the UK, see the customer experience as relevant to the purchase decision. Still, only 55% were satisfied with said customer experience. To improve this ratio, the most successful institutions are willing to take this customer feedback into account.
This requires a change of perspective. Instead of the traditional approach of "Which products fit our customers?" they are ready to ask: "What motivates our customers? And how can we support them even better?”
As real estate turns out to be one of the key topics that truly “motivates” advised customers, institutions can leverage it to win new clients, retain them and maximise revenues. For financial service providers, investing in this area means no less than investing in the future.
Reliable real estate data more important than ever
The UK real estate market is in a state of upheaval. Lender Halifax has just reported that the average house price dropped by 2.3% in November 2022, describing it as “the largest monthly drop on its index since the beginning of the financial crisis in 2008”.
Chris Hodgkinson, managing director of House Buyer Bureau, explains: “The UK property market now looks to be entering a period of decline, with sustained price drops for the last three months - and this will be further fueled by sustained economic uncertainty and inflation that just refuses to be controlled.”
In this challenging market climate, reliable data and precise forecasts for each individual case are required for wealth managers and their clients to make better-informed decisions.