One of the first things I learned when I started investing was the value of surrounding yourself with a great team. Doing so can, quite literally, save you thousands, not only as you begin but throughout your entire investing journey.
When choosing your team, seek the recommendations of those you trust, be they friends, work colleagues or others in the real estate industry. Then, create a short list and conduct interviews. Yes, interviews! These people need to know their stuff.
Here’s my list of five key members to have on your property investing team:
You need to know where you can buy and how much a bank will lend to you. Your super-hot investment with great returns on paper might be kryptonite to a bank and no one will finance a loan for you. A quick call to your broker will quickly show you where to focus your energies and when you should move on.
Laws governing contracts of sale differ from state to state, with many state-specific nuances that you need to be aware of, so choose an experienced expert familiar with where you want to buy. Many things are often said to secure a sale. When it comes to anything verbally agreed, get it in writing and put it in the contract conditions. Then it’s binding on all parties.
Buying your property in the correct name is probably one of the most important steps. Get this wrong and it can be very costly to make changes down the track. You don’t want to be paying stamp duty more than once or paying thousands for a complicated structure that doesn’t suit (yes, we’ve had that happen to us). Speak to a trusted advisor about your long term investment goals so that they can structure your investing in the most efficient and effective way for you.
This one is often overlooked but a vital cog in your team wheel. Landlord insurance gives you peace of mind and covers you for any downtime should something go array. Most policies offer loss of rent and cover tenant damage (we’ve had tenants throw out kitchen drawers, just before they “did a runner”…). I always insure our properties as soon as the contract becomes unconditional, just to make sure we’re covered should anything crop up before we settle.
Ask them how many properties they manage, how many are on their team and get them to send you landlord references. I have never chosen a property manager without first conducting a phone interview and asking them a set of rigorous questions. You’re charging these people with managing an asset worth many hundreds of thousands of dollars, not to mention sweat equity. Make sure they’re qualified and have the capacity to handle the work.
Taking the plunge and buying a property can be daunting for any would-be investor, but having the right team behind you can make all the difference.
Building trust with your team means that should you need to act quickly (as is often the case with real estate investing), you know your call will be returned promptly and that you can act on their advice with confidence.