The foundation of your real estate investing business is a well-chosen power team.
So you want to be a real estate investor? Wondering where and how should you start?
When we started our business in 2012, we attended a three-day boot camp that got us hooked and started us on our real estate journey.
Building a foundation for your business starts with building your “power team.” We attended the local Real Estate Investor Association meeting (REIA) and found a lot of resources! Everyone from attorneys, bookkeepers, moneylenders and contractors attend, and there is always a speaker covering a helpful topic. It was a great place to learn about investing and, more importantly, to be around like-minded people.
Our power team started with a financial planner who helped get our entities started. To do business in North Carolina, you must have a company name, an LLC or corporation, an EIN number and a bank account. When all of that is in place, seek out a CPA firm that understands real estate transactions, including wholesaling and flipping.
Next, you’ll need a bookkeeper that is separate from your CPA firm. We find using two separate companies helps with checks and balances, and there are two sets of eyes looking for mistakes. The bookkeeper does the data entry and reconciles our bank statements and credit cards. The CPA does tax planning throughout the year, so there are no surprises come April 15.
After attending several REIA meetings, we became more comfortable and were able to zero in on a few more power team members. We sought out brokers and real estate attorneys to get educated on how best to work with them.
We found there are numerous ways to sell a property. There are full-service agents who do all the work for you and charge a 5 percent to 6 percent fee. There also are limited-listing agents who list it on the MLS, but it’s really a “for sale by owner.” Limited-listing agents typically charge a nominal flat fee, so you’re saving 3 percent.
With attorneys, there are also numerous ways to close on a property, and you have to find the right one that fits your needs. Be patient and ask plenty of questions.
There is usually a place in the REIA meeting where they ask for “needs and wants.” That’s a great place to stand, introduce yourself to the group and ask for help locating the final people on your power team. Reputable contractors, private moneylenders, coaches and mentors will probably be sitting in the room, eager to help.
Look for mentors at your local REIA, Real Estate MeetUp Groups and Deal Maker Sessions in your area. Attend as many meetings as possible and bring plenty of business cards.