My neighbor, Kevin, is fond of suggesting that everyone “Go big or go home!” when it comes to pursuing their personal and professional goals. Of course, I rib him about it endlessly because he rarely takes his own advice. For example, he’s been talking about buying distressed property to rehab and resell for years, but only recently started seriously looking into training as a real estate investor. When he came to me about finally taking those first steps toward building a real estate investing startup, he asked if there were more things he could do to ensure that his company succeeded. I told him what I tell everyone: success is never guaranteed, but, with the right strategy in place, it is possible to attain.
Top Strategies for Growing Your Real Estate Investing Startup
Building your investing business so that you have a better chance of succeeding over the long haul requires a strategic plan of action. This is true whether you’re quitting your corporate job to invest in real estate full-time or simply want to create a side business that helps to pay for the kids’ college tuition. There are several approaches you can take to grow your business and keep it growing strong for years to come. But, not all are created equal. So, let me share the top three strategies you can implement right now if you want to get on the path to achieving your investing goals, like Kevin, without wasting any more time.
Take it one property at a time. In the beginning, buying multiple investment properties in an attempt to grow your business fast may not be financially possible or prudent. That’s perhaps as it should be. Even with the most comprehensive training under your belt, there is still a lot to learn about buying and rehabbing homes that you intend to resell or rent out—most of which you’ll have to learn on-the-job. Everything from correctly calculating your potential ROI to performing the most cost-effective investment property kitchen renovations takes practice. Every transaction will be different and every renovation will provide an opportunity to learn and grow your expertise, albeit slowly. Of course, once your confidence and cash flow grows, and making big mistakes becomes a thing of the past, then you can decide if you want to take on more than one project at a time.
At this rate, however, you may only get the chance to invest in one, possibly two, investment properties a year since the average rehab can take anywhere from three to nine months. And, the average returns you can expect to realize per property aren’t what they appear to be on TV. In real life, you’ll need to buy, renovate, and sell or rent a lot of homes to make a living. That’s why you need an established network of pros to help you avoid the biggest mistakes and conquer the learning curve.
Partner with another investor. Partnering with another investor—especially one who is more experienced—can fast-track your on-the-job training and help you build your property investment portfolio faster. You should be able to avoid making common novice mistakes, like overestimating the potential ARV on a deal, and slip easily into more complicated rehabs with someone by your side who’s been there, done that. Also, having a partner who’s already got some projects on the books may help you get a hard money loan or other types of funding since most lenders view giving money to novice investors an especially risky proposition. Access to more experience and funding, minus potentially fewer mistakes, less risk, and a smaller workload, can add up to a startup that’s stronger than most from day one.
But, do keep in mind that it can take time to find a partner you can trust with your business and who’s interested in investing their energy into helping you learn the ropes. And, more often than not, you’ll have to join forces with an existing firm that will make you do all the work on the projects they’ve chosen while they take all the money. You can still, in theory, benefit from using this strategy. Unfortunately, in practice, it could slow building your own business down.
Invest in a franchise. Purchasing a part-time or full-time real estate investing franchise, like HomeVestors®, is as close to a sure-fire way as you can get for building your investing career. You’ll first go through a week-long initial training program designed to help you invest like a pro from the moment you open your doors. And, once you’re open for business, you won’t be left fending for yourself. As an independently owned and operated HomeVestors® franchisee, you’ll have immediate access to a large network of other regional franchisees and a seasoned Development Agent for one-on-one mentoring. Together, they’ll work to answer all of your questions, help you solve your most difficult problems, and guide you through the challenging stages of your business’s growth.
You also get the benefit of working under an established national brand with a proven track record for success, ”We Buy Ugly Houses®.” So, coming up with an effective marketing campaign is a startup task you can just check right off your list.
Of course, what’s critical to understand about any business-building strategy is that there is no magic formula for succeeding at real estate investing. Buying, renovating, and selling houses for profit, or holding them as rental properties, takes a lot of hard work, dedication, and time. But, as a HomeVestors® franchisee, you’ll not only start out on the right track, you’ll have a team behind you that will do everything they can to help keep you there.
The Best Solution for Building Your Business
From the beginning, building my real estate investing startup had to be the package deal. I wanted the most comprehensive investor training available, a network of support, access to one-on-one mentoring, and the best tools and resources for generating leads on good deals. When I first started researching my options, however, I thought I’d have a problem finding a simple, straightforward solution that could offer all that. But, it turns out that HomeVestors wasn’t hard to find at all. Now that my franchise has grown, I help others, like Kevin, achieve their investing goals too.
Start, and grow, your real estate investing startup by contacting HomeVestors about franchising opportunities—the first, and best, strategic move you can make.
Each franchise office is independently owned and operated.