how to build an investment team?

[Brandon36]

What are some good tips in building your real estate team for investors? would it depend on the type of investments you do or is it best to just have a good all around team in place even if you don't use them all the time.

 

[Sherilynn]

It's a combination of both.

For example, I use several realtors - each with a different specialty. You may use one realtor for selling or buying investment properties, one for selling properties targeted towards owner-occupiers, and one for specialty properties such as suited houses or multi-family.

The key is to ask questions not only to determine the person's qualifications, but also to determine if the person is a good fit for you. Specifically, people have varying communications styles, expectations, and values, and you need to be sure your team members and yours match. It can be frustrating or counter-productive to communicate with people of different styles, and it is no fun to deal with someone whose values are not in line with yours.

 

[Brandon36]

It's a combination of both.

For example, I use several realtors - each with a different specialty. You may use one realtor for selling or buying investment properties, one for selling properties targeted towards owner-occupiers, and one for specialty properties such as suited houses or multi-family.

The key is to ask questions not only to determine the person's qualifications, but also to determine if the person is a good fit for you. Specifically, people have varying communications styles, expectations, and values, and you need to be sure your team members and yours match. It can be frustrating or counter-productive to communicate with people of different styles, and it is no fun to deal with someone whose values are not in line with yours.

Thank you for that information that gives me a way better view of how to go about investing. that was well said and I completely understand where your coming from. Its best to have your realtor specialize in something rather then use one to do everything, especially things there not really use to doing. and how would you go about getting certain contracts for your deals would you get it through them or someone eles?

 

[Thomas Beyer]

Start with an experienced (not rookie !!) realtor and property manager. Both have to specialize in the asset type and target area.

Then have a mortgage broker and lawyer, but that can come later, after you have an accepted offer, unless you envision creative financing or unusual terms then you need a lawyer earlier. Then, after closing, have an accountant and tax accountant on your team, too.

 

[Brandon36]

Start with an experienced (not rookie !!) realtor and property manager. Both have to specialize in the asset type and target area.

Then have a mortgage broker and lawyer, but that can come later, after you have an accepted offer. Then, after closing, have an accountant and tax accountant on your team, too.

perfect explanation, thank you for the help

 

[Sherilynn]

Depending on your situation, you may want to consult with an accountant (expert in accounting for RE investing) before making any offers. If you are a regular Joe buying in your personal name, then not such a big deal. However, if you have other business interests or substantial income, you may want to incorporate from day 1. Only a thorough examination of your situation can answer that.

As for contracts, standard contracts through realtors are fine, but you must be sure to include all the terms and conditions you want. (Don't let a realtor convince you to skip terms or conditions to make the sale easier. That is asking for trouble.) REIN has some good info on this in the ACRE binder.
If you are doing creative purchases, such as with some vendor financing, then you may want to use specialized contracts. However, I would start with regular purchases and leave the creative stuff until after you have a few properties under your belt.

 

[Brandon36]

Depending on your situation, you may want to consult with an accountant (expert in accounting for RE investing) before making any offers. If you are a regular Joe buying in your personal name, then not such a big deal. However, if you have other business interests or substantial income, you may want to incorporate from day 1. Only a thorough examination of your situation can answer that.

As for contracts, standard contracts through realtors are fine, but you must be sure to include all the terms and conditions you want. (Don't let a realtor convince you to skip terms or conditions to make the sale easier. That is asking for trouble.) REIN has some good info on this in the ACRE binder.
If you are doing creative purchases, such as with some vendor financing, then you may want to use specialized contracts. However, I would start with regular purchases and leave the creative stuff until after you have a few properties under your belt.

ok makes sense. So if I was just buying myself or maybe a house every year then it would be fine to use one realtor, but since it will be more for business purposes then its best to have a couple. and since it will be considered a business you will get tax differently that's why you recommend the accountant? and what if you don't have that much money to start, because since im starting while im young I never got the time to really establish myself for a down payment so therefore I would have to be creative in order to get any deals down with JVs, wholesailing etc. So how would I go about that?

 

[GaryW]

what if you don't have that much money to start

Hi Brandon:
If you buy and go through in great detail, Russells "JV Secrets" binder, it will definitely help present a deal to a potential investor. If it is indeed a deal, you are trustable, and can show them how well their money is protected(compared to other investments), then you're chances have increased a lot.

 

[Cory Sperle]

Do NOT JV until you have deals under your belt and have built a track record with your own cash. Save, use cheap financing to buy your first place and go from there.

 

[Sherilynn]

Your best bet is to attend a REIN ACRE event and consider becoming a member. The education is priceless plus you have the benefit of being able to contact REIN staff and faculty with complex questions and for deal analysis.

You won't be able to get a complete education from this forum alone.

 

[Tina Myrvang]

I agree 100% with you Sherilynn!

 

[Kjeck]

First make a list of members that you should have in your team. There are key professionals that I suggest you have on your investment team: real estate agent, lenders, contractors and handymen, bookkeeper, accountant, lawyer, insurance agent and property manager. Every member will perform a specific function. For instance, attorney will advise you about real estate transactions, the mortgage broker will make sure that you get your money, when you sale a retail as well as help you to locate buyers and qualify them quickly to get a transaction through contract negotiations.

 

[Matt Crowley]

"Making a real estate team" is a made out to be a lot more grandiose than is necessary for most folks who will end up buying one or a small handful of properties. For small investors, your "team" is mostly a group of mercenaries whose time goes to the highest bidder. The important thing is that your asset makes enough money to pay for competent individuals.

Lawyer: any real estate lawyer should be able to handle a simple real estate transaction.
Accountant: if they have CPA, CA they should be able to handle simple single family home transactions
Property manager: good help is expensive. Try and manage yourself if at all possible as quality PM is expensive and you have no scale to justify lower rates.
Handyman: lots and lots and lots available. 90% of problems you should be able to address yourself.
Brokers: many, many, many competent brokers
Realtors: I don't find many add value on the buyer's side but there are sure lots of them out there. Not sure how useful as vendor other than getting a mere listing and attracting other Realtors to pay 1/2 commission.

Don't worry about the "team". Spend your time understanding how much money the asset makes and how much you need to pay for competent contractors. If you are in a decent market, there will always be lots of mercenaries to choose from.

 

[REInvestors888]

A word of advice: When you select people in your team please make sure that they understand what you are doing or intend to do and that are in the same page with your business goals. Otherwise, expect disaster down the road.