Rome wasn’t built in a day, and not just by one man! It took a team of experts and a matter of time and planning. The same effect is taken towards investing in real estate; it takes time to see your returns, and you need a team of people working in your best interests, to educate you, and save you time and money.
No large and successful organization is run by one person. Everyone is different, and it is important to identify your strengths, and invite talented and positive people onto your team to elevate your weaknesses. Building relationships in any business is important, and it is no different in real estate. You cannot build bridges to burn them, you want to optimize your relationships so that your business runs like a well oiled machine.
We love investing in real estate, because it is a tangible asset (among other reasons), and for the same reason, it is a multi faceted business that you are running. You can’t just buy a building and have it produce income – it’s your TENANTS who produce income!
Are you going to find them and qualify them? Are you going to mow the lawn and collect their rent? Or hire property management professionals to run your income property?
Let’s dive in to see what kind of tradesmen and professionals you should have on your team, as a real estate investor.
Mortgage Agent
Work with a mortgage agent to build a portfolio, not to do a transaction.
First things first – you need funding! (unless you are working as the sweat equity partner in a Joint Venture Agreement, or plan to purchase a home in cash).
Work with someone who owns their own investment properties, and knows and understands the process, and how your decisions now will effect you down the road. When you work with a professional who is a real estate investor themselves, they will have a deep (and personal) understanding of the Buying process, and the truths and challenges after possession.
Not only will the mortgage agent give you the facts about the rates and terms for your next property, but they can give you insight on creative financing strategies that they are able to obtain for you, perhaps strategies that they have used for themselves.
Consult with your preferred mortgage agent before you put an offer in on a property. Talk to them about your long term investing plan, so they can help you structure your portfolio so you won’t step on your own foot down the road. Starting out right is extremely important.
You don’t want surprises, you want to be informed.
Choosing the right professional could take time, so don’t settle for a family friend who isn’t versed in putting together creative investment strategies, or deal with the first agent you speak to. Get a feel for their experience, communication methods, resources and even ask for references.
Property Management Company
Being a landlord is a big responsibility.
You must find tenants, qualify them, take them through your extensive tenant application process, verify their references & credit check, make sure the property is ready to move into, organize who is paying what bills, collect rent, and stay in constant contact with them after they have moved in. You must also be available to fix faulty fixtures in the home, organize and execute repairs to the property, and be available for when they want to move out. Then start the process all over again!
If you don’t have time to spend going through the tenant process, hire a property management company! They typically charge 10% of the monthly rent and make sure EVERYTHING flows smoothly.
They will ensure that rent is collected on time, and that the property is being well maintained by your tenants. When there are small repairs to be made, they will fix it, with money from your reserve fund. If there are bigger repairs to be done, they will contact you for your approval.
Accountant
Know your destination and how you are going to get there.
Having an educated accountant on your power team is extremely important to creating financial wealth for you and your family. The will consult you on your current realities, and help you create an action plan, by analyzing your current situation, and creating a blue print on where you want to be in 5, 10, 20 years and beyond.
No matter how many properties you current have, you should always know where you’re going, and structure your plan accordingly. Create a long term strategy for your real estate investment portfolio by starting at where you want to end up and work backwards.
Reverse Engineer your Business Plan!
Working with the right accountant, can create insight and solutions to obstacles and create solutions for you today and tomorrow. They will also keep you aware of any bills, taxes or spousal support you may have forgot to pay, that will effect your credit when applying for your next mortgage.
It is important to have an accountant that you know, trust and have mutual respect for.
It is a bonus if you have an accountant and mortgage broker that are in good relations with each other, so they can help you create a professional portfolio with your end game in mind.
Accountant
Know your destination and how you are going to get there.
Having an educated accountant on your power team is extremely important to creating financial wealth for you and your family. The will consult you on your current realities, and help you create an action plan, by analyzing your current situation, and creating a blue print on where you want to be in 5, 10, 20 years and beyond.
No matter how many properties you current have, you should always know where you’re going, and structure your plan accordingly. Create a long term strategy for your real estate investment portfolio by starting at where you want to end up and work backwards.
Reverse Engineer your Business Plan!
Working with the right accountant, can create insight and solutions to obstacles and create solutions for you today and tomorrow. They will also keep you aware of any bills, taxes or spousal support you may have forgot to pay, that will effect your credit when applying for your next mortgage.
It is important to have an accountant that you know, trust and have mutual respect for.
It is a bonus if you have an accountant and mortgage broker that are in good relations with each other, so they can help you create a professional portfolio with your end game in mind.
Realtor
Working with an investor friendly Realtor is imperative to starting, and continuing your successful Real Estate Portfolio.
Alike your Mortgage Agent, it is extremely beneficial if your Realtor also has investment properties.
They are on the ground level and can be the BIGGEST asset to your Power Team.
Working with a great Realtor can cut out half the work and due diligence you must do as an investor (when it comes to finding the right home). They KNOW the local market, and if they’re good, they will know where it is going, and know how the current and future environmental factors will affect your portfolio now and later.
Realtors are professional Negotiators, and will have your best interests in mind when it comes to the negotiating table. Knowing what your terms are, and how to put together deals to be satisfactory to you, and the Seller is crucial.
You know who to call – US!
Insurance Company
I will tell you the same thing for every agent you hire – shop around! I had to interview several agents (for my mortgage and insurance policy), before I found someone I can trust and rely on. It is important that you have an insurance company who is transparent with you. You must know upfront what your rights are, and what is and is not covered in your policy. As an investor, there are specific landlord policies that you are eligible for. Make sure that you don’t just get a generic homeowner policy, and ensure that it is in fact landlord specific.
Don’t learn by your mistakes – learn from others! Ask insurance agents what they have encountered in their rental properties, and how they can cover you in emergency (and non -emergency) situations.
A good idea is to know and follow the rules, and choosing an insurance company that can cover what you feel comfortable with.
Landscaper
If you don’t live in the area, or simply don’t have the time to maintain the exterior of your rental property, you may want to consider hiring a landscaper.
Having this contract will ensure the lawn is cut, and snow is cleared throughout the year.
You could alternatively put in the tenant contract that it is their responsibility for exterior maintenance (but at the end of the day, you as a landlord are accountable).
Having a landscaper could dissipate potential arguments, and prevent your home (at least from the outside), to be turned into a slum den. Your neighbours will respect you and be happy to have an outstanding family and landlord on their street.
Mentor/ Investing Network
In everything you do, it is always beneficial to consult someone with superior knowledge then you in said field.
When you are mastering a trade, you usually start as an apprentice, and once you have mastered it, most good tradesmen never stop learning!
Whether you are just starting out and want some advice, or if you are an experienced landlord and learned from more than one of your own mistakes, it is a great idea to stay connected with like minded individuals, for ongoing brainstorming, support and to keep updated with local and nationwide trends and regulations.
For investing, we recommend being a part of REIN, and finding other, more local investors to bounce ideas off of.
We are always happy to share our experiences and recommendations with our clients!
Contractors & Tradesmen
From the big projects to a leaky tap, you need someone on call that you trust, and know will do a quality job in your home.
You may want to renovate before you have tenants move in to attract a better tenant profile.
Maybe you want to force appreciation in the home to re finance at a higher market value.
Either way, having a contractor you know has integrity is imperative to a standard of work that will last until your next tenants and beyond.
