One of the most beautiful things about real estate investing is the great diversity which it offers to any investor, regardless of his/her experience and knowledge. There are many real estate investment strategies which are so different from one another. You will find endless real estate markets, investment property types, and rental strategies to make you lots of money. Last but not least, there is the possibility to act as a real estate investor on your own or with real estate partners.
Regardless of what options you go for in your real estate investing business, it is important to remember one thing: No real estate investor ever succeeded completely on his/her own. Even if you prefer to make all your investment decisions on your own, you will still need a wide network of various real estate professionals. Here is a list of them:
1. Real estate agent/real estate broker
As anyone interested in the real estate investing business, you already know that a real estate agent is different from a real estate broker. The main difference is that a real estate broker can work independently and even have other real estate agents work for him/her. Meanwhile, a real estate agent – though he/she has passed all required real estate classes and passed the real estate licensing exam – has to work under a licensed broker.
In any case, the main reason you need either of these two real estate professionals is that the first step to becoming a real estate investor is buying a rental property. You will ask: But can’t I do that on my own to save money from commission fees? Of course, you can go through all the research, real estate market analysis, and investment property analysis, but you are still unlikely to arrive at the same outcome as a real estate agent or broker. Remember that these people are real estate professionals and as such have access to resources and information that you simply cannot reach. For example, real estate brokers and agents have access to the Multiple Listing Service (MLS), which is available only to these real estate professionals. Moreover, the MLS has many excellent investment properties for sale which are not advertised in any other outlet. A real estate agent will be able to advise you on the best real estate investment property in your location and help you score a good ideal with the property seller.
In reverse, when you decide it’s time to sell your income property in order to buy a better one, a real estate broker will be capable of finding the most appropriate buyer for the highest possible price.
So, regardless of how confident you feel in your skills as a real estate investor, don’t underestimate the importance of a real estate agent or broker.
2. Real estate lawyer
Once again, in real estate investing you don’t have to work with a real estate lawyer, but it is highly advisable. It is just one of those real estate professionals who will make your life easier and your real estate business more successful. It is always a smart idea to hire a real estate lawyer before you sign any purchasing agreement in order to make sure that all legal formalities have been taken care of and you are not exposed to unnecessary risk, regardless of whether you are the buyer or the seller. In addition, once you own a rental property and are ready to start renting it out, it is better to have the landlord-tenant agreement be drafted or at least approved by a real estate lawyer. In this way you will make sure you are not breaking any federal or local real estate laws and that you are protected as much as possible from the risks of coming with dealing with tenants. Furthermore, you will need a lawyer if somehow you reach an eviction process despite all precautions you have already taken. Another example: when deciding whether you turn your real estate property into an Airbnb rental, it is the safest option to consult with a real estate lawyer on the state of legal issues related to short term rentals in your specific location.
So, be a reasonable real estate investor and find a good real estate lawyer for your future real estate investing deals.
Among the real estate professionals you need to get to know is an appraiser. The job of an appraiser is not just to evaluate real estate properties on behalf of banks so that they can decide whether to give you a mortgage loan or not. You can actually make good use of an appraiser if you know one personally. This professional can advise you on whether a certain investment property is worth what you are ready to pay for it or whether you are selling your income property for too little. He/she can even give you hints on what fixes to do around your rental property to increase its value before renting it out or selling it altogether.
Of course, you can do all the budgeting and calculating on your own. But keep in mind that the real estate investing business is quite flexible, meaning that property tax rates, insurance rates, and others change quite often, so you need someone who is capable of following all these for you. Thus, when considering what real estate professionals you should work with, never forget about an account with expertise in real estate.
In most cases a real estate investor needs to take a loan of one form or another to finance the purchase of a rental property. That means that you will need to work with a lender as one of the few real estate professionals in your network. This could mean either an employee at your bank or a private lender. In any case, it is best to establish a long-term working relationship with this person.
6. Other real estate investors
Regardless of your stance today, maybe one day you will decide to try out a real estate partnership. Then you will need other real estate investors whom you have known for a long time and whom you can trust. Moreover, there are different ways in which you can benefit from knowing real estate investors such as hearing their expert opinions, having access to rental properties they are selling, offering them properties when they are buying, learning about the local real estate market, learning about other locations, etc. So, it’s a smart step to start getting to know and network with as many other real estate investors as possible in the world of real estate investing. These are just some of the real estate professionals that you will need sooner or later.
Even if you are among the top real estate investors in the country, there is always space for some improvement. One way to enhance your real estate investing business is to get to know and work with the real estate professionals listed above.
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