Jim Rohn famously said that we are the average of the five people we spend the most time with. Guess what? Your business is no different. If you want to be successful in real estate, then it is vital that you build a great team. Real estate is all about building relationships, and you want to start building your team as quickly as possible. Each team member is a specialist that has certain skills that they bring to the business. These team members will allow you to leverage your time and go out and find more deals.
We have split up team members into your primary members and your service members. We feel that real estate brokers are one of the most important members because they are the ones that will be feeding you those deals. A great real estate broker can help round out your team.
Primary Team Members
Service members are an important component to the success of your business, but you may employ several of these members. They can be replace easier than your primary team members, but once you find a great service member, pay them when the work is done to ensure quick and good work.
Team Member Definitions
Partners – Very high-level team member who has to have same vision and ideals as you do. You have to share same investment strategy and possess similar goals. Partnerships work best when each partner has different strengths and is allowed to utilize their strengths.
Mentor – We attribute much of our success to working with mentors. Mentors are willing to share their extensive knowledge with you, and this guidance has allowed us to shorten our learning curve. Who knows, a mentor can even turn into a potential partner.
Family – Some family members have been supportive of our business venture, and others have been critical. It’s up to you who you want to listen to. My mother is a perfect example of someone close to me who was skeptical, but she was just fearful that I was making a huge mistake. She changed her mind when I presented all the facts and the business model. We also use the negative comments as motivation to succeed.
Coach – There are different types of coaches. I have utilized real estate coaches, business coaches and life coaches. A coach will help you develop a plan, give ideas and guidance, and most importantly, will hold you accountable for your actions.
Accountant – This member will give you advice on tax preparation and will advise you on your own situation. Make sure that your accountant has experience in real estate and utilizes all laws to grow your wealth.
Lawyer – Depending on what state you are purchasing real estate, a lawyer may or may not be used to execute the purchase and sale agreement. We used a title company to draw up the P&S agreement. Lawyers can also provide other documents, such as leases and can form your LLCs.
Property Manager – If you decide to run your own properties, you should still interview management companies in your market to familiarize yourself with costs associated with running the property.
Mortgage Broker – Very helpful in trying to secure financing for your property. Mortgage brokers have the ability to shop your loan to many different financial institutions, and they may have leads on off market deals and bring them to you.
Insurance Agent – An insurance broker will be able to provide you with the proper coverage on your property. A yearly review of all your policies is vital to make sure that you have the proper coverage and to keep costs down.
Real Estate Agent – It is imperative that you locate a broker whose specialty is multi family investing, and one that is knowledgeable in the local market. Their job also entails running rent comps, and helping us build our team..
It would be wise to build relationships with a few brokers. Take them out to lunch and ask them questions. Let them know that you are a player and you are looking for deals.
Title Company – A title company is responsible for issuing insurance to a buyer that insures any defects against the property. It protects the owner against any claims against the property. The owner wants to be certain that he is the rightful owner of the property, and the title company will issue a “title search” that researches the ownership of the property. The search will come up with any outstanding liens, mortgages, judgments, or unpaid taxes on the property. Once he search is complete, the title company will issue title insurance, which protects the owner from any future title problems. In certain states, title companies also perform closings.
Home Inspector – A key player in the due diligence phase. We were fortunate to find a thorough, trustworthy inspector, which allows us to go back to the seller with any issues. Make sure you inspector has experience with multifamily properties.
Architect – An architect is used when an investor decides to construct a building, or when a property is in violation, an architect is familiar with the code and can remediate the existing violations.
Appraiser – This team member is often overlooked by investors, but having a competent appraiser will allow you to execute the third leg of our strategy, the finance right. Appraisers can justify the value of a property to a banker and will facilitate in the refinancing of a property. They are utilized to determine market value of properties.
Engineer – In real estate, an engineer usually works in conjunction with an architect to solve issues with building structure or code violations. We have used engineers to design water systems for our property, as well as designing septic systems for our apartment homes.
Contractor – We use licensed contractors when we need to pull a permit for a job and when we need quotes while performing our due diligence.
General carpentry and maintenance – These players are the front line of your operation. They will directly impact the customer service end of your business. A happy tenant is one who stays, and employing courteous, competent maintenance men will keep your apartments full.
Ratio Utility Service Company – A company that calculates the resident’s utility based on number of occupants, square footage , or a combination of factors and then bills back the usage to the tenant. Utility expenses can include water, gas, electric, and even garbage. The landlord does not have to install meters, and can hire a RUBS company to calculate the bills and send to the tenants.