According to CNBS who spoke with nine different millionaires back in October of 2019, real estate investing is one o the best investment you can make and is one of their most lucrative assets.
With that being said, you are probably here to learn more about how you can expand on your property portfolio. As you can see from the mouth of the pros, having a good portfolio can be very financially beneficial to you. So today we have put together five ways you can do exactly that.
1. Property Management
Hiring a property manager will allow you more time to find new properties and manage the ones that you already have. This is especially true if you are managing your portfolio in multiple cities, regions, or states.
With a property manager, you will not have to find properties, or tenants yourself and you can enjoy the full benefits of a property manager. This allows you to free up more of your time and focus on what you think is most important.
Most property managers charge anywhere from 6-12% of your monthly collected rent for their services.
In most situations, the investor is not equipped to deal with all of these tasks on their own. This will include screening tenants, collecting rent, organizing repairs, and ensuring that any local laws are followed. Considering everything that is taken off of your plate, this is a very important and sound investment.
Screen Your Tenants
Additionally, a good property manager will also help with screening tenants and ensuring violations of any local ordinances are avoided. They will also be able to take care of rent collection and arrange for repairs so saving you from having to deal with them yourself.
2. Managing Money and Experience
When investing in property, you want to try and reinvest all of the money that you make from your investment properties back into your business. This will ensure that your income is continually growing and it will make you a lot less vulnerable when the going gets tough.
Although the tempt of just saving or spending your hard-earned money is difficult, you do not want to cave. Reinvesting is one of the most important and best ways to expand your property portfolio.
If you are going to be using new income to improve your lifestyle with new clothes, a car, renovating your own home, etc., that could very well backfire on you. As a real estate investor, you never know when these investments may need repair or when you might be hit with a vacancy.
You should have a separate savings account for personal use or crises that is not connected to your company or investments.
Managing Your Experience
As you gain experience in the real estate world, you will find that you are able to spot opportunities much easier. You will also be able to make better decisions when it comes to your investments.
That is why it is so important to always be learning and expanding your knowledge. You can do this by reading articles like this one, attending webinars or seminars, or even just talking with other investors.
The more experience you have, the more successful you will become. And with a successful portfolio, comes a successful life.
Managing your money and experience is going to help you grow much faster than you may think!
3. Networking and Contractors
Next, let us talk about networking and contractors.
Networking is indispensable in real estate. You need to help and be helped by other real estate professionals. This way, you will be able to expand your expertise and access greater resources like trustworthy contractors or incredible offers. You will also have more eyes and ears to observe trends and emerging technologies.
This helps you expand your network of contacts outside of just property investors. Who you know is essential to being successful.
Do not be afraid to ask others for help! People may not always know how they can help, but oftentimes they will find a way. This eventually will lead to you helping them and both of your growing and becoming more successful.
Knowing Contractors
Networking is not the end-all, be-all though. You also need to know which contractors are trustworthy and reliable.
You obviously want to choose the best possible contractor for each job, as this is your investment we are talking about after all. Be sure to vet them carefully before signing an agreement or handing over any deposits or fees.
When inspecting potential contractors, ask to see their qualifications and past work. If possible, get referrals from other people who have used them.
Be sure to check with the Better Business Bureau to see if any complaints or negative reviews have been filed against a prospective contractor you are considering hiring for a big job.
Knowing the best contractors around town can really help you expand your business and increase profits. Lastly, do not forget about the networking part. Your network might have a few good resources or recommendations for some contractors.
4. Funding and Refinancing
Finding alternative funding is one of the best ways to expand your investment property and portfolio.
When it comes to real estate, there are a lot of different financing options available. You just need to find the right one for you and your situation. Some popular financing options include commercial loans, private money loans, seller financing, and partnerships/joint ventures, fixed rate mortgages.
Each of these options has its own benefits and drawbacks, so be sure to do your research before deciding on anything.
Another thing to keep in mind is that your debt-to-income ratio will eventually play a role in your ability to get financing. This is why it is important to always be expanding your property portfolio so that you can continually grow.
Refinancing Options
A lot of people do not know that it is best to shop around before applying for a mortgage to ensure that you are getting the best rates possible, but refinancing your properties may provide you with better loan terms and allow you to devote additional resources into more rental apartments.
When it comes time to refinance, you will want to reaffirm your loan terms with the lender first before looking for a new one. This way, you can determine if you are able to qualify for better financing on your current assets.
Next, be sure to look at the lenders' rules and regulations before seeking out new options. You do not want to end up paying too much or having an unfair interest rate.
You should always do the right research before choosing any new loan terms. It is important that you find what works best for you and your portfolio.
5. Manage Your Time Right
Whether you like it or not, property management is not the only thing that will occupy your time as a real estate investor.
In fact, being an independent contractor can often be more stressful than being an employee as you are ultimately responsible for everything on your own.
Fortunately, there are many apps and tools available to help streamline this process and make it easier for you. With the right tools, you will be able to get rid of some of that stress and free up more time so that you can focus on what is most important.
Make sure that you think through the time you spend each month and make a schedule. Managing your time is going to be critical when you are this busy and trying to grow and be successful.
Take Your Time
On top of managing your time, you should also take your time. Rush investments typically are not good and will hurt you at some point. Just take your time when you are investing and making decisions.
You want to avoid shortcuts while trying to scale your investments as these can lead to poor decisions, compromise, and burnout. Which none of those are good for your personal life or your business life.
Scaling a Property Portfolio is About Skill
Real estate investment is all about acquiring new skills, learning more about the industry, and overcoming any challenges that come your way. The deeper you dive into this world, the more capable you will be at growing and maintaining your property portfolio.
This is why it is so important to always be expanding your knowledge base and trying new things. It is also vital to stay organized and efficient with your time. With the right tools and strategies in place, you will be able to manage your business successfully.
Do not forget that success does not happen overnight. It takes patience, hard work, and dedication to achieve real results in this field. So keep pushing forward and do not give up on your dreams!
Invest in Your Own Success
Be sure to take your time when investing. Rush investments typically are not good and will hurt you at some point. Just take your time when you are making decisions on whether or not to invest in new properties, be it for yourself or another person.
You want to avoid shortcuts while trying to scale your property portfolio as these can lead to poor decisions that compromise your business life and burnout which is never a good thing!
If you want some more tips on property portfolio scaling or looking for real estate investment opportunities, contact us today. We are here to help!