Building Your Team- Part 2

Building Your Team- Part 2

Within real estate, as with most things, it is critical to form a competent and effective team that will help you achieve your goals. Last week we discussed assessing your own skill sets and the amount of time you are able to commit toward each investment property. This week we will begin to discuss various team members that will be essential for you to add to your team that will help you in your real estate investment endeavors. Personally, I feel that the best way to grow your business is by getting to the point where you can replace yourself in every way and have a system of people in place to keep the cash flow going. I know I would rather be sitting a on beach, relying on my team than running around ever minute.

So, just as last week when we ask you to take an honest look at yourself, when building your team, you will need to honestly assess the people you are including in your investments. People can talk a good game, but you still need to pay attention when it is their turn to step up to the plate. Do they interact well with you and other members of your team? Are they truly experts? Do they return calls and emails promptly, or are they a pain to contact? Do they produce what they promised? In order to get to the place where you don’t have to rely on yourself for everything, you have to build a trustworthy and capable team around you. It is important to note that you will not need all of your team up and running to start investing, but you should start taking to as many as possible in each field to find and see who you may want on your team later as you grow. With that in mind, let’s start taking a look at some of the various roles people can have on your team.

MENTOR: I want to begin here because if you are able to find a mentor, they can be instrumental in guiding you through the process of successful real estate investments. You may find your mentor through then network of people you already know or through your educational endeavors. You many even be able to ask to join/shadow someone else who is already an expert in the field (someone who is already where you aspire to be). You can ask to be taught so you can learn the flow of things in exchange for offering your skill sets.

DEAL FINDERS: Deal Finders are people that will help you find wise investments. This could be something you are already good at or you may choose to find other deal finders. Deal finders include Bird Dogs (someone who will find a good investment and pass on the property address and owner information to another investor for a fee) or a Wholesaler (someone who contracts the home with a buyer at a higher price than with the seller, and keeps the difference as profit). But most commonly your deal finder will be Real Estate Agents. Real estate agents are a great part of your team. A suggestion here is make sure that they work with investors, not just homeowners. Homeowners and an investors are completely different customers.

LENDERS, BANKERS: I recommended to produce this relationship BEFORE you actually need the money. You want to have the relationships and terms established up front before you make any offers. That way, when you begin to run your numbers, you will know if a deal is a good one or one you should pass on based on the terms you can get.

Some investors will rely on a hard money lender (an asset-based loan where a borrower receives funds secured through real property). While other investors will not go near them. Regardless, you want to have options when you are in the mix of financing your deals. With some deals, having a hard money lender makes sense; with other deals, it does not make sense. Again, it is helpful to find a hard money lender that you are comfortable with, who you trust, again, BEFORE you find your deal.
It is also possible to line up a Private Money Lender or even Equity Partner early on.

The reason it is tough for newer investors to get private money is because most private money lenders/equity partners want to partner with someone that investing experience under their belt. However, this team member might be possible for you if you position yourself as the feet on the street, with them as the money partner. You both are new to the business but are willing to bring something different and unique to the table.

TITLE COMPANY: You should typically work with the same title company for all your real estate investments. This builds a long-term relationship with the title companies, and they are more willing to go above and beyond when they know they are going to get repeat business. I have also been able to find some great deals from my title company; they are one of the first to know when someone get a lean on the title.

CPA: CPA’s, also known as Certified Public Accountants, provide financial strategies, prepare reports for property owners and real estate investors, and contribute with planning, investment, budget and tax reporting activities. This is a very critical person to your team. Again, as with real estate agents, you want to ensure your CPA has real estate investing experience. Ideally, your CPA would be a real estate investor themselves. The time to add this person to your team is right now, when your starting off. You must comply with all the tax rules from the very start. It would be a hard lesson to learn when the IRS comes knocking.

Next week, we will finish up discussing various roles people can have on your team. In the meantime, please feel free to schedule a 15-minute consolation call with us by clicking the below link. We can discuss where you are at, where you want to go, and see if we can help you achieve your goals. Wishing you great success in all you do!

Schedule a time to talk with us.

Next week, we will discuss 5 more roles people can play on your team: Attorney, Contractors, Cleaning Company, Property Manager, and an Accountability Group

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