Opportunities to start property investment firms exist for people who have the money to invest. People have been investing in land for hundreds and perhaps thousands of years. And, as in the early days, many people view real estate investing firms as a solid investment.
Like any investment venture, real estate investment can be a risky, yet extremely satisfying business, whether you have a residential or commercial real estate investment firm. Build a strategy to get your business off the ground and attract clients.
Minimize the risk of starting your own real estate investment management firm by:
- Learning everything you can about real estate investments so that you can develop an expertise that clients will trust.
- Making short-term and long-term goals concerning where you want your business to go.
- Considering a specialization like foreclosure investment firms.
Gain real estate experienceYou'll find that many real estate investment management firms employ or are started by Realtors. It is to your benefit to have a real estate background or have someone on staff who does. For instance, one of the designations that Realtors can gain is the Certified Commercial Investment Member (CCIM), which states that a person is knowledgeable about commercial and investment real estate.
Learn to networkNetworking is by far the best way to get clients. Know the lenders and real estate professionals in your community. Join your local Chamber of Commerce and local Real Estate Association. Networking builds relationships that eventually include business when your start getting referrals.
Decide whether you want to operate a residential or commercial real estate investment firmYou can be a one-stop fits all kind of investment firm that offers both residential and commercial real estate opportunities or you can specialize in one type. Specializing helps you focus your marketing efforts.
Add property management to your offered servicesOne service that some real estate investment management firms offer is property management. As investors often invest in multi-family housing, this can be a good fit.
Consider including foreclosure investment services in your firmAnother area that real estate investment firms can specialize in is foreclosure properties. Foreclosure investment firms are a good way for investors to get property at below market value.
- Check to see what licensing you need to operate real estate investment firms in your state.
- Explore how you can limit tax liability for your clients with options like 1031 exchange transactions.
- If you're not ready to start your own firm, consider joining a real estate investment club.