Since the pandemic was declared in March 2020, more than 60 million Americans have filed for unemployment insurance. Further job cut announcements by companies are reflecting more layoffs in the corporate and management sectors. If you are one of the thousands of mid-level or senior-level executives who have recently lost their jobs, you are probably looking at what is next for you. As a corporate refugee, you have the option to strengthen your stock portfolio or play around with your retirement funds. But it is better to steer clear of the current ups and downs in the stock market. Compared to the volatility in the stock market, real estate investing is likely a more stable place to invest your money—and your time—while offering you the opportunity to become your own boss. But how do you go about real estate investing during a pandemic?
The Coronavirus-led recession has posed unprecedented challenges, affecting every industry. Real estate investing is no exception. However, with the uncertainties looming over jobs and the global market, making a career switch to real estate investing is a solid move right now. If you are wondering about getting started with real estate investing during this pandemic, it does not have to be too hard if you have the right tools, resources, and network support.
Real Estate Investing Opportunities Resulting From This Pandemic
Back in March when the Coronavirus first hit, several regional real estate markets in the U.S. witnessed an increase in the number of homebuyers. As the pandemic started affecting major cities, families realized the challenges of working—and schooling their children—from home. This led people to look for bigger houses with more yard space in suburban and rural areas. The record-low mortgage rates further fuelled the home buying spree.
However, with the economy still struggling under the impact of the pandemic even after nine months, several of these homeowners are struggling with job cuts and furloughs. With federal stimulus drying up and deadlines for foreclosure moratoriums closing in, many are finding it difficult to pay the mortgage and are likely to face foreclosures sooner rather than later. As a real estate investor, you can make a difference in your community and help such distressed homeowners get out of an “ugly” situation by investing in such properties and selling them with higher upside potential.
The big question here is how to start as a real estate investor in the middle of this pandemic. If you have the right knowledge and tools, you can confidently take advantage of the real estate investment opportunities in the current market.
Challenges of Real Estate Investing During COVID-19
As someone from the corporate sector, you might be already a pro when it comes to presenting a sales pitch to prospective buyers or negotiating with distressed homeowners. However, real estate investing during the pandemic is a different ballgame altogether. With social distancing guidelines in place, starting and running your real estate investing business virtually has its own struggles such as:
Professional Real Estate Training
You need the knowledge and skills to become a professional real estate investor. Unfortunately, due to COVID-19, most in-person seminars and training workshops have been canceled or postponed indefinitely. You can check a few online courses on real estate investment such as those available on Udemy. However, many of these courses aren’t helpful beyond the initial certification. What you really need is hands-on experience and training in real estate investing along with the knowledge of the market.
Lead generation is the biggest concern for most real estate investors. With the ongoing pandemic, you can no longer hit the pavement or canvass the neighborhood to search for motivated home sellers. Many distressed homeowners likely don’t want you knocking on their doors due to health concerns sparked by the virus. In-person home auctions and networking events are canceled in most places right now and that leaves you with very limited options for lead generation.
One way is to take the social media route and look for potential leads by using the right hashtags in tweets and posts to grab more attention. You can also create ads on social media platforms to increase your outreach as a real estate investor. But you can’t rely on social media alone to connect with distressed homeowners. Even if you are lucky enough to connect with one, you would be facing stiff competition from other real estate investors who are using the same method for lead generation.
You can also search the website of your local county for properties facing foreclosures. However, these properties going under the hammer in online auctions are likely in pretty bad shape and would need extensive rehab work that might exceed your budget. You can’t inspect these properties beforehand, and there is no guarantee that you would win the intense bidding war.
Inspection or Valuation of Properties
The inspection and evaluation of distressed property are two of the most important steps in real estate investing and in the current environment, a few things have changed. Now homeowners offer only virtual tours of their properties. You need to hire a contractor who inspects the property while following social distancing measures and sends the repair estimates to you electronically. Even wholesale deals are being closed through e-signatures turning the entire process of real estate investing remote.
As a real estate investor starting out during the pandemic, you need technology at your disposal to run the business virtually. Apps for real estate investing such as Property Evaluator, Property Fixer, Realtor.com, and others can help you address some of your worries regarding inspection and valuation of properties. But most of these apps focus only on certain aspects of the real estate investing business. To get a more comprehensive picture and insights into your real estate investments, you need to switch between multiple apps but that can turn out to be confusing.
Ongoing Network Support
To step into the current real estate market, you need some guidance from seasoned investors who have witnessed something similar in the past and have the experience to take advantage of the investing opportunities resulting from this pandemic. While in-person networking with such experienced investors is difficult in the present environment, you can find several self-acclaimed real estate gurus online, sharing pro tips on investing in exchange for hefty fees. Well, you need to save yourself from such people who preach shady real estate investing practices that can land you in the soup.
Though these struggles are real, they should not deter you from moving ahead in your real estate investment career. All you need is the right resources, knowledge, and network support.
How to Confidently Start Real Estate Investing
Back in 2008 when I started as a real estate investor, I had my own reservations. Though the COVID-led recession is something that we have never experienced in the past, the struggles I faced while starting my real estate investing career during the Great Recession were not too different. Thankfully, being a HomeVestors® franchisee helped me face those struggles, and ride the recession wave confidently.
Being a part of the nationwide network of independently owned and operated franchisees, I have access to:
- Comprehensive Training: HomeVestors®’ comprehensive week-long training course was crucial for me to understand the real estate market during those turbulent times in 2008 and make effective investment decisions. The in-depth tried-and-true training has helped more than 1,100 franchisees with no prior experience to sell more than 110,000 homes since 1996.
During this pandemic, the training has moved online and new franchisees completing the virtual training are enjoying the same benefits as those who did it in-person. As a real estate investor starting out now, your learning doesn’t stop once you finish the virtual training. You will develop career-long relationships with your Development Agents and continue receiving pro-tips even when you are in the field.
- Leads: Generating leads while operating virtually can be a nightmare for any real estate investor. Yet, the nationally-known and trusted “We Buy Ugly Houses®” ads ensure that distressed homeowners know who to reach out to when they have finally decided to sell their properties. So, instead of you chasing potential homeowners, motivated and qualified leads contact you directly, saving you the trouble of hitting the pavement and knocking on doors during a pandemic.
- Tools: As a HomeVestors® franchisee, you get access to an innovative platform, UGVilleSM, that provides you with all the proprietary tools that add value to your business. With UGVilleSM, you need not rely on a patchwork of different tools and apps to get details on your investment deals. The integrated platform offers:
- DealVestors®, a user-friendly listing portal for wholesale properties
- A sophisticated lending portal to get connected with hard money lenders
- ValueChek™, property analysis and valuation app
- An end-to-end communication and lead conversion tool
- Ongoing Support: As a new investor, you need to be mentored by an experienced coach to operate the business virtually. To conduct due diligence, you require some experience to know what you are looking for, and how to inspect the house and evaluate the necessary repairs. Seasoned investors who coach you as Development Agents (DAs) have survived and thrived through previous recessions and can guide you with what to look for in a house before buying it. These DAs help new franchisees like you learn the ins and outs of the business, and help you make good investment decisions.
With such a robust support system and necessary knowledge and resources, you can start real estate investing during this pandemic without worrying about the struggles of operating virtually. To know more about how to make the right move towards building your career as a real estate investor, request information about becoming a franchisee today.
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HomeVestors of America® is the nation’s only real estate investing franchise, providing business opportunities to real estate and investment professionals across the nation.