Whether you’re a seasoned professional or an up and coming broker, one of the biggest hurdles you may face isn’t prospecting for leads. It’s prospecting for the right leads. Real estate prospecting means networking. And in today’s heavily connected world, that means leveraging every tool at your disposal. Social media. Digital advertising. Community events. Even asking for advice from mentors and your potential competitors.
It can seem exhausting, but it doesn’t have to be. No one likes chasing down leads—at first. But once you realize how creative real estate prospecting can be, the one or two hours you spend generating those leads flies by. In fact, with a little imagination and daring you just might find yourself learning to love it. Here are some tips for both brokers and investors alike.
“For Sale By Owner” homes generally mean that an owner may feel confident about their sale. They also may not realize how difficult it is to actually sell a home. Some FSBO homeowners may be in distress after job loss, divorce or other emergencies. If you’re new to a market, FSBO homes can actually mean a gigantic windfall for prospecting. Establish a personal rapport with the owners. You may find that empathy can generate better leads than expensive advertising.
Real estate groups on Facebook can range from menial but mindless fluff to groups full of valuable first hand experience you can’t gain anywhere else. Learning to discern the latter from the former isn’t particularly difficult, but knowing how to leverage your social media profile adequately can be. The National Association of Realtors has indicated that while 80 percent of realtors are currently networking on Facebook, broker presence on competitor platforms remains underrepresented in comparison. You can use this absence to your advantage, particularly in prospecting millennial buyers. The wider your profile, the greater your visibility and your authority.
There’s no doubt your social media presence is an ideal source for prospecting real estate leads. But it’s not the only one. Drive both traffic and sales by linking your social media campaigns to your landing page. You’d be surprised at how simple this process can be, even if you have little or no experience with digitally marking your business. And with the advent of cloud-based CRM systems like Salesforce and Qualtrics, automating your marketing efforts has never been simpler!
Your digital marketing presence may be seamless, but you’re neglecting one part of the real estate process. It’s based on physical property. Not virtual. And no matter how many consumers prefer the convenience of reviewing materials on the web, there’s always going to be a need for physical media. Get your face and name out there. Show your prospective leads you’re a flesh and blood person, not just a social media script spouting all the right buzzwords.
An open house is the perfect resource not only for prospecting sales leads, but for building up your network as well. In fact, research has shown that open houses generate a relatively minor number of sales. So why are they so well attended? It’s simple. Both home buyers and brokers are genuinely interested in real estate trends, and open houses provide useful tools for both industry professionals and consumers to educate themselves on new developments. They can be as much a social event as they can generate leads. And you may find the two can go hand in hand.
It may surprise you, but large local companies can be a veritable goldmine for new hires who’ll be relocating. Reaching out to their HR department to discuss helping employees transition to the neighborhood more smoothly can sometimes be as simple as sending out a mass template email—particularly if the new area has a large number of colleges and universities. Don’t think of this as selling your services as a pitch. Simply tell them some quick facts about the area and let your market pitch for you.
There’s no question that millennials represent a critical consumer segment. But very few are willing to invest in being a homeowner. In fact, only 1 in 3 according to recent research. By focusing on rentals in addition to traditional owner driven properties, you can serve this somewhat cautious segment of the population and drive business where your competitors often lag behind. With more Americans renting now than at any other point in the last 50 years, you can’t afford not to take advantage of the prospects.
We all know how critical marketing strategies are in real estate. But are they getting you the prospects you deserve? Find out more by visiting the Colorado REIA .
Most young adults are now starting to invest in properties. Buying your first rental investment is very lucrative but can be a major investment. Before deciding to jump on this bandwagon, take some necessary precautions. Take your time, do your research and read the following investing tips on buying a house that actually pay off.
Understand the real estate market. That is the first thing a potential real estate investor should learn. Get the right mortgage. By doing so, you are keeping your costs low and potentially reducing the uncertainty about the property’s cash flow. The leverage of a mortgage will help free up some of your cash investments which you can eventually use for repairs or another future investment. Remember, however, that with a mortgage comes financing costs which could be a lot higher than expected. Consult a professional before making such a huge decision.
Another investing tip for beginners is to purchase single-family homes first before investing in larger properties. It is the simplest way to begin your journey as a new real estate investor. The process and maintenance are easier compared to commercial or multi-family properties. There will be less wear and tear on the property with only a single tenant. Additionally, when something breaks or gets damaged, you only need to fix one thing.
Should you decide on using a mortgage to invest in a property, it is essential to weigh all the financing options available. Will it be a 15- or 30-year mortgage? Should you choose an adjustable or fixed rate? Check online marketplaces that allow you to compare offers and rates quickly to find a suitable one.
Most experienced real estate investors state that the best way to reduce risk and increase your chances of success is to ensure that you are investing enough money to be cash flow positive. Leave margins for errors to cover unexpected expenses. This will also allow you to weather through difficult economic times. If the property cash flows, market fluctuations will be irrelevant and you can hold those funds for a longer period of time.
For first time investors, it is ideal to invest in a property located in an area with a higher return on investment. There are amazing deals on transitioning or in re-established locations. Study the areas available for you. Do thorough research. To achieve the highest return on investment, you must know the location really well and what types of houses are selling in the neighborhood.
Purchase a property in a location and niche you are familiar with. Ask around or draw from previous experiences to gain a competitive edge over your competitors. Let’s say you are a veteran. It is ideal to buy a rental property near military bases for military transfers. If you are a medical practitioner, buy a property near hospitals in your area. If you are a university alumnus, purchase one near local campuses.
A good marketing strategy will give you a good ROI quickly. When you purchase a vacant property, it is important to find tenants as soon as possible. Before investing and putting all your hard-earned money on a rental property, make sure you have a good marketing plan. If your property is vacant for a long period of time, it will eat up your cash flow. Online real estate marketplaces are the best places to choose when advertising your rental property.
Purchase a property and make improvements that you see fit for your ideal renter. Make improvements suitable for them. By targeting the appropriate renter like students, families, young professionals, vacationers, or retirees, you are getting the most value out of your money.
The bottom line is to always do your research. Know the neighborhood you’re going to buy in. Know what types of properties have sold before.
For more tips on how to invest in a property that can pay off, visit Colorado REIA.
Paying off your mortgage early. It sounds like fairly shrewd advice. Especially considering that most homeowners have a problem with visualizing their mortgage as nothing more than an ever spiraling money pit.
But paying off a mortgage isn’t always practical. Or effective. In fact, for most homeowners it may seem next to impossible.
It’s been estimated that only 34 percent of Americans have fully paid off their mortgage to the point where they have 100 percent equity in their home. They’re lucky. An increasing number of homeowners are applying for loans with alarmingly high debt to income ratios. And while it’s tempting to own your home free and clear in an investment period marked by independent entrepreneurship and a highly volatile stock market, it may not always be the wisest idea. Like everything in life there’s as much risk as there is benefit to paying off your mortgage.
Still, it’s perfectly normal to have a dream. That’s why you bought a home in the first place. If you’re one of the millions of Americans considering paying off your mortgage early, here’s what you should know about the pros and cons.
There are hundreds of ways of tapping into additional cash reserves, no matter what your needs are. And investing in the real estate market has always been a cornerstone for budding entrepreneurs. After all, it’s why we formed our association. But consider the very real cost of the market.
Inflation’s a great example. The only thing it diminishes is your cash value. And the only thing that accumulates faster than inflation is property costs. By paying off your mortgage early (as opposed to saving), you’re not offered much of a buffer from both.
But maybe you’re not a real estate investor yet. You’re just an average homeowner looking to take an incredible leap. Your mortgage payments are a risk free form of investment. It quite literally reduces your risk load, whereas money placed in high venture stock market gambles aren’t necessarily going to yield the returns you once hoped they had. Let’s look at how you can turn mortgage payments into an investment.
Most homeowners don’t stop to consider what a potential cash cow their home can be. It might be a huge source of funding for their banks and realtors. Just not themselves.
An astonishing 36.6 percent of Americans currently rent their homes and apartments. And that number is only likely to increase. Only 37 percent of millennials—the largest American generation in history by far, numbering at some 75 million—are homeowners. Some have cited student loan debt. Others attribute it to uncertainty about the global economy. But the need for shelter, the cost of living and investment opportunities have never been higher.
There’s a reason why many Americans view apartment rental agencies in an exceedingly negative light. While many are no doubt reputable, many are run by fairly unethical individuals. Subsequently many are looking at renting single and multiple family homes from property managers they know, trust and can establish a working relationship with. Shouldn’t all that money you’ve spent on refurbishing and remodeling actually pay you back without having to sell your home—particularly in an uncertain market?
Let’s face it. Interest rates on your mortgage are probably more than you’d like them to be. They’re more than most Americans would like them to be. And there’s always going to be a need for additional cash for emergencies. So it only makes sense to free up the equity in your home, whether it’s through refinancing options or paying off your mortgage early.
But there’s an additional bonus to paying off your mortgage. Unsecured personal loans are risky business. Not only do they put you at greater risk for liens and come with absurdly high interest rates, but they can come with a drastic risk for fraud—an estimated $905 million in 2017 alone. Cashing out your home through a home equity line of credit may temporarily increase your interest rates, but you’ll have a much greater sense of security in the long run.
Maybe your lifestyle is fortunate enough that you can afford to pay off your mortgage early. Maybe it’s secure enough that there’s a much greater safety in doing so compared to the actual risks. Or maybe you are in dire need of emergency funds and it’s one of the few avenues left for you.
Real estate investments have come a long way in the past twenty years. The demand for commercial real estate is booming. House flipping isn’t just making a comeback… it never went away. And investment opportunities in the market have never been greater. Sometimes you find them where you least expect them.
Right in the comfort of your very own home.
If you’re ready to get serious about real estate investing, Colorado is the state to do it—and we’re the professionals who can guide you. With close to 75 years of combined experience, the Colorado Real Estate Investors Association presents you with the insight and resources only three investors who have brokered over 2,500 deals can. Real training. Real success. And real money. That’s the Colorado REIA difference. Find out more at coloradoreia.com or call (303) 816-3653
“If you’re so smart, how come you’re not rich yet?” It’s a common adage that many budding entrepreneurs hear during the course of their everyday conversation. The usual retort, of course, is “ I’m getting there!” And hopefully? You are. But if you’re a real estate investor, all you really have to do is show doubters your property portfolio. Typically, that puts such cynicism to rest. And with good reason. After all, shelter is of the great vital necessities in life—even in commercial real estate. And opportunities are in plentiful demand. But it’s a high risk gamble. It’s been estimated that 28.1 million Americans consider themselves real estate investors. And with that number, the obstacles facing entrepreneurs can be relatively high. It’s no longer enough to seize what looks like a great opportunity when 2018 reported a decrease of approximately 7.7 percent in sales of new single-family homes and 10.3 percent in existing homes. That’s the bad news. The good news? With a strategy emphasizing foresight and care, you can eliminate the chance of loss and increase the chance of return. Here’s some of the best tips for entrepreneurs looking to invest in real estate.
It’s one thing to have a general understanding of how real estate markets operate. But it’s another thing to have an understanding of market performance in specific metropolitan cities. And market performance can be predicated on several factors, in addition to historical sales:
If you’re just beginning to look at real estate investment, it’s important to remember that historical sales are never constant. They don’t just change annually, but month to month. What might seem like an ideal opportunity in a buyer’s market could turn out to be the result of high risk potential in any of the preceding factors. Review your targeted neighborhood carefully. Sometimes even high opportunity zones can yield negative returns if businesses choose to invest elsewhere.
In particular, both vacancy rates and construction rates. A general rule to keep in mind is the higher the construction rate, the higher the price range. Frequently, this is a result of a higher demand in up and coming neighborhoods. But the opposite holds true for vacancy rates. Generally speaking, more vacancies in a neighborhood means lower rates. More often than not, this can be due to a large amount of foreclosures—as witnessed in the 2008 housing crisis. And while it might be tempting to take advantage of low priced properties in distressed neighborhoods, keep in mind the sustainability of your investment. Higher vacancy rates exist for a reason, and you won’t necessarily find many interested buyers regardless of the refurbishment you may have conducted.
One area that many beginners in real estate investment frequently overlook is the cost of auxiliary materials. That can include marketing, construction, attorneys, inspection services and title insurance. All of which can wind up costing you more than the bargain you initially anticipated if you’re not careful.
“Early on, I made the mistake of hiring a home inspector who later turned out to be less than reputable,” explains Alex Forrest, an investor from Salt Lake City. “And unfortunately, he recommended some area contractors who ultimately billed me for renovations and repairs which turned out to be entirely unnecessary. Not only unnecessary, but entirely too lengthy. By the time they were finished, I was out $30,000—in addition to legal fees. All on top of a home I thought I was only paying $175,000 for!”
While disreputable contractors are unfortunately not an anomaly, that doesn’t mean you won’t find ones who are not only trustworthy but consistently deliver craftsmanship. You’ll want to review their portfolio. You’ll want to see examples of their work. And you’re definitely going to want to ensure they’re registered with the Better Business Bureau and have necessary certification for residential property renovation.
More importantly, you should look for a mentor who can guide you through the process of investing—particularly if you’re just beginning a career as a real estate investor. Not only can they provide invaluable advice on what to prepare for, they can act as a referral service for brokers, realtors and attorneys who are both reputable and can find you ideal properties at an ideal price.
As we said, shelter is a vital necessity and ideal investing opportunities are in high demand as a result. So are risks. But with some forethought, you can minimize the pitfalls and wind up not only on top but on your way to being a successful real estate entrepreneur. Here’s hoping you simply don’t stumble more than you have to.
Are you serious about a future in real estate investing? The Colorado REIA is the state’s premier investment association, providing coaching, guidance, workshops, networking opportunities and a host of other exclusive member benefits. To find out more, visit us at https://coloradoreia.com/ or call (303) 816-3653
Real estate has been making news for the last few years – good and bad. Many have considered investing in real estate an ideal long-term investment. Property values increase over time and generate passive income along the way. With the right kind of wealth building and investment strategies, it is possible to profit and build real wealth through property investments.
It may not be a simple process, as building real wealth takes many cycles. You cannot simply sit and relax and watch the money roll in. Good investment strategies involve having a set of sensible approaches, from identifying your needs and developing a program that works with your plans.
Here are a few wealth-building strategies that will help investors – new and experienced – achieve their end-goal
As one of the most common approaches being practiced today, home ownership has become a motivating factor for many. It serves as a base while you continue to live your lives. Owning a home, when held and sold, serves as capital-gains tax-free profit. Properties appreciate over time, so when the time comes that your children move out, you can sell the bigger home and settle in a smaller one. That leaves you with a bigger return on investment, and you can use the equity from the sale to start on other investments and earn income.
Invest in a budding real estate market. Research where most young people move to nowadays. These are the markets where the value in that area will increase as its residents’ earning powers increase. If you realize that rents go up drastically, do not sell your property. Instead, rent it out and use your property as an income-generating property. The money will continue to roll in and you can use the profits for more investments.
The essence of true wealth is not just about building stock portfolios or money. In achieving lifelong wealth, one needs to understand and discover their “whys” and use it to help others. It should be your passionate motivation and life’s purpose. Planning is key, especially if your “why” leads you to launch or invest in a business. Look at all the resources available to you and have a clear idea of your goals, as well as an exit strategy.
Most successful entrepreneurs build and shape the purpose of their business by fully understanding their journey, from start to finish. Success metrics are something that can be measured; otherwise, it will be difficult to manage your investments. Once you have a clear understanding of your “why” and learn to empower people along the way, real wealth will soon follow.
The real estate market may not be as booming as it was before. However, one of the best investment strategies to build real wealth is by investing in properties you can actually rent out. In reality, no matter how good or bad the economy is, people need a place to live in. Apartments, condos, duplexes, single-family homes, and townhouses are easy to finance, sell or rent. In the event of a downturn, these properties still maintain their value.
Another reason why this is a good strategy is that residential properties offer more flexibility than any other kind of real estate. For example, if you lose a tenant in a commercial real estate, the value of your property goes down. A residential property, on the other hand, holds and even increases its value, rented or not.
This strategy is almost the same as property development, where you buy a building and build two or three dwellings to sell, finance, or rent out. In this case, you need to build a second dwelling or a granny flat on a property. You can partition an existing residential unit and create two dwellings. This gives you two rental incomes from one property. This is one of the wealth-building strategies that is considered a high-yield method because it has an opportunity for strong capital growth once sold.
Investing in high scale markets like real estate always involves risks and has a potential for financial losses. Before making such a huge decision, always seek professional advice and guidance from a licensed and accredited financial advisor.
Contact us at Colorado REIA for more information how to build your wealth and live a happy and financially stable life.
If you’re looking to invest your money and diversify your portfolio in new ways, real estate can offer you several avenues for doing so. Real estate can help you increase your assets and provide additional income streams. The choice to invest in the field of real estate can be rather lucrative if done right.
One of the hardest parts of breaking into real estate investment can be figuring out the best place to begin. With a defined strategy and clear vision you can embark on your own path to success. Below are five key ways to invest in real estate and diversify your portfolio.
A great starting point to becoming a successful real estate investor is by taking advantage of the space you already have. Whether you’re subdividing your home or renting out a spare bedroom, there are several paths to bring in steady income. There’s also the prospect of renting out your living space using app-based services such as AirBnB.
This avenue gives the investor an opportunity to try out being a landlord without a huge upfront monetary commitment. Renting out rooms through a third party booking service such as AirBnB offers the protection of a basic level of screening through their registration and ratings. It also offers a host guarantee that helps cover any basic damage that may occur.
One of the more tried-and-true forms of real estate investment is becoming a landlord. Buying and renting out properties or space to tenants is a practice as old as time. Whether you’re buying out commercial space and signing long-term leases to corporate tenants or renting out apartments to families, being a landlord can be quite a lucrative investment opportunity.
Of course this method has drawbacks of its own. This form of investment requires significant cash upfront to purchase or mortgage the property. There are also costs associated with rehabilitating and maintaining it. There are also risks associated with dealing with tenants and their potential impact on the property. Until you have the revenue to develop or hire a property management company to deal with some of these headaches, it’s important to remain mindful of the risks.
Another well-tested method for growing your wealth is fixing up and reselling homes. Popularized in reality television shows over the last couple of decades, the idea of purchasing an undervalued home and renovating it as economically as you can isn’t always as glamorous as those shows make it out to be.
It’s important to have a solid understanding of what it takes to successfully rehabilitate a home or to find a partner that does. You’re looking to invest in a property that is undervalued and in need of only minor cosmetic upgrades in order to raise the resale value to potentially earn a profit. Not paying attention to the market overall or knowing how to find potential structural issues can quickly take a property from a prospective goldmine to a complete bust.
The internet has served as a monumental platform that has shaped the core of our economies and society itself in remarkable ways. From automated banking to the rise of cryptocurrency, the internet has changed the core foundations of markets as we once knew them. With the advent of crowdfunding investment platforms, the ability to begin to invest in real estate has never been easier.
The SEC has traditionally regulated crowdsourced investment platforms similarly to syndication. This means that you had to be an accredited investor with a decent amount of capital to invest. Thanks to recent changes in regulation, non-accredited investors can begin investing with as little as $500 thanks to platforms such as Fundrise and RealtyMogul. These sites prescreen and only accept a minimal amount of projects proposed to help ensure the highest returns on your investment.
Real Estate Investment Trusts, commonly known as REITs, give investors an opportunity to break into the market without needing to be as involved as other methods. REITs are public or private companies that own a portfolio of real estate holdings. They tend to pay out high dividends and make a great form of passive income.
REITs can come in a variety of forms depending on the company you’re investing in. Publicly traded REITs tend to trade on exchanges like stocks, while private non-traded REITs may be harder to sell. The type of REIT you choose to invest in can help determine your risk, so it’s important for you to carefully research where you choose to invest your money.
An evolving and growing market allows you to get into real estate investing easier than ever. From renting out the spare bedroom in your condo to investing in real estate investment trusts that have vast portfolios, there are more chances for you to grow your wealth now more than ever. Pay attention to new trends in the market and for any new opportunities that may arise.
Please feel free to visit Colorado REIA for more tips on real estate investment.
Buy and hold real estate investing is one of the most common real estate investing strategies. It refers to the process of purchasing a property and holding on to it for an extended period, usually 5 to 7 years. The buyer may or may not sell the property down the line, but it is considered to be an excellent way to build wealth over time.
According to the National Association of Realtors, statistics show 51% of buyers found the home they purchased online. This shows how powerful digital can be in your marketing efforts as a real estate investor. If you are looking to scale your real estate investing business I highly suggest using digital marketing to do so.
With the tough competition in real estate these days, the ability to stand out from the pack is crucial. This is where effective marketing strategies come in handy. However, as a real estate investor and professional, trying to figure out which strategy works and what doesn’t is time-consuming.
When people speak of success, they often talk about how they got their career started and how far they were willing to go to reach their goals. One of the ways to reach your goals is to find someone who will personally guide you. Remembering them this month is one thing, celebrating the success you reached with their guidance is another!Continue reading