As a real estate investor, you have a wealth of knowledge available at your fingertips. Whether you’re just starting out or have years of experience, there’s always more to learn. In today’s digital age, you can easily access an incredible depth and breadth of subject matter related to the real estate industry. You should make it a top priority to always be a student of your craft, in this case, real estate investing. The more you know, the more you grow.
Let’s explore a few avenues by which you can start or continue learning about the real estate industry.
The most basic form of real estate knowledge are traditional textbooks on the subject, most typically produced for high school and college students. While you could make the argument that, given the publishing cycle for academic textbook purposes, this information could be a bit outdated by the time you read the book. This is true to a degree, but the real benefit lays in the fundamental real estate knowledge you can glean from these sources. Textbooks produced for real estate courses are meant to follow a strict structure for the purpose of adhering to an academic curriculum. This gives you the benefit of learning against a logical flow of information as opposed to the somewhat standalone nature of real estate articles that you can find on the Internet.
Despite the fact that they may be outdated in terms of publishing, the basic real estate knowledge you can find in real estate textbooks and books is ultimately timeless. In this way, you can build a foundation of general real estate knowledge upon which you can build with additional specialized knowledge you gain from other sources.
As a real estate investor, you have the benefit of a huge community of people just like you, no matter where you live. There are hundreds if not thousands of international, regional, and local professional organizations related to real estate and real estate investing that you can join. These organizations often convey numerous benefits, including offering thought-provoking articles and forums where you can communicate with industry experts and like-minded individuals. In these forums, you can also post questions and receive responses from people within the organization.
Professional organizations often host periodic events for their members to get together in person, provide trainings and best practice presentations from leaders in the field, and provide a network of individuals related to your industry. For example, professional real estate investment organizations can establish a network of mortgage bankers, property management companies, real estate developers, and many others that you can interact and communicate with. These contacts are often invaluable, and it’s unlikely that you’d be able to build up such a large network outside of this professional organization.
Some professional organizations may require an annual membership fee be paid, while others can be provided free of charge. Evaluate the costs of joining a professional organization against the predicted benefits – it may be worth it tens time over if you make the right contact or build the right professional partnership because of the organization.
One of the most well-known professional organizations related to the real estate industry is the National Association of Realtors, or NAR. You can only join NAR if you’re a licensed real estate agent or broker, but if you’re an active real estate investor it may make sense for you to become a licensed real estate agent as well. Not only can you earn commission on your own transactions (though you would have to pay a percentage to your broker), but you can avoid the hassle of working with a middleman (i.e. another real estate agent) and work directly with the buyer’s agent or seller’s agent in your real estate investment transactions.
If you decide to become a licensed real estate agent or broker and, thus, gain access to the NAR, you’ll find that this is one of the most useful professional organizations to be part of as a real estate investor. Not only will you have access to the top-rated tools and software in the trade, but you’ll gain access to a wealth of industry-specific content and knowledge. More specifically, you’ll receive an email newsletter or magazine with real estate articles and statistics catered to your local market. NAR is a leader in the real estate industry and provides dozens of benefits to real estate industry participants, including annual conferences, marketing resources, in-person member meet-ups, content and news articles, and so much more.
Word of Mouth
You can learn a lot by speaking to and working with people that are more experienced that you are in the real estate investing business. Try to cultivate a mentoring relationship with someone you trust and respect, but most importantly, who has plenty more real-life experience than you do. You can garner gems of knowledge by listening to their horror stories about the landlord-tenant relationship, the intricacies of financing, and much more. It’s important to remember, though, to take all advice with a grain of salt. It’s easy to think that just because someone is a successful real estate investor now, they were always that way. More often than not, they had to endure the same struggles and challenges that you’ll have to face, in order to get to where they are today.
One benefit of having strong mentoring relationships when it comes to your real estate investing business is that you can bounce ideas and concepts off of a seasoned investor. It’s far too common for laypeople to speculate on the ups and downs of the real estate market, including when it’s a good time to buy or not, without having any firsthand experience in the industry! There’s an old saying that goes “when your barber tells you it’s a good time to buy real estate, you’re already too late.” This means that by the time good real estate advice becomes common knowledge among people that are not in the actual industry on a day-to-day basis, it’s already outdated advice. Don’t trust everything you hear from strangers, especially when it comes to making business decisions. Take a quick sanity check against someone you know and trust, and preferably someone who’s made a real estate deal or two.
The Importance of Statistics
On a related note, while it’s tempting to take advice from your friends and family and even established real estate investors, it’s crucial to stress the importance of statistics and data. Real estate investing is a business – so at the end of the day, you should be able to fact-check your speculation against a little bit of calculation. If a deal seems too good to be true, it probably is. Don’t let charming talk sway your decisions – always turn to the numbers to back up the facts.
This also rings true to news articles and social media posts on the Internet. Many of these articles are determined to cause you to act in one way or another. You should always question what the author’s intentions are, and who stands to profit from such an action. Take every news article with a grain of salt and do some more research to better determine whether the information presented is true or a blatant exaggeration, or somewhere in between.
When you do find that the articles you read have statistical evidence to back up their claims, make sure you confirm the timing of the data. It does you absolutely no good to read an article from three years ago telling you the real estate market in your county is about to boom – imagine if you went and purchased three new rental properties in response to this outdated piece of news, only to find that the true market in your area is already at an all-time high. In today’s day in age when data is overwhelmingly available, it has become more crucial than ever to confirm that the data is both timely and accurate.
Facebook and Other Social Media Sources
One of the dangers of social media platforms like Facebook is that it gives regular people the opportunity to pose as experts on a subject they may or may not be experts in. For example, let’s say you follow an old friend from high school on Facebook and have been a passive observer of their career in the real estate industry. You understand on a basic level that they mainly use their social media platform as a marketing platform in order to drum up new business, but nonetheless you receive a steady stream of their posts showing glamorous properties all over town at ridiculously low prices. As a real estate investor yourself, you start to think this person could be a good partner for your business. After all, you buy properties and this person seems to always have properties for sale.
This could go one of two ways. Either this real estate agent friend of yours truly has great deals available and you purchase investment properties at fair rates which result in a healthy profit to you, or you find that their Facebook profile was truly just a marketing ploy and you end up wasting your time. The lesson in this is to use Facebook and other social media platforms carefully when it comes to your real estate investment business. Understand that the articles posted on these sites typically don’t undergo a thorough fact-checking process and are rarely connected to reliable sources. Oftentimes, it just provides people a platform to speak about things in whatever manner they choose, no matter how legitimate the article seems.
The same advice holds true for other social media platforms including Instagram, Snapchat, Twitter, and many more. These platforms are primarily for entertainment, and secondarily for information transfer. Always verify the facts you read with trusted sources on the Internet before you take any action related to real estate investment. It may take you a few more minutes (or even a few more hours) to research a topic you’re unsure about, but it will save you plenty of money in the long run if you can avoid doing a bad deal based on faulty advice.
Seeing is Believing
Despite the fact that a tremendous amount of knowledge is available in a number of sources, nothing can compete with on-the-job learning. You can read all the textbooks, articles, newsletters, and editorials you want about the real estate investing industry, but it won’t compare to the first deal you do in real life. The amount of knowledge you gain from purchasing your first real estate investment property is priceless, and the experience of your first deal is something that is not easily replicated on paper. You can read about the pressures of negotiation, the stress of comparing mortgages, and the despair of having a bad tenant in your property, but you won’t truly understand them until it happens directly to you. You’ll learn more about the real estate industry (and about yourself) than you ever thought possible, only through real-life experience.
You should continue to balance your actual experiences in the real estate investment industry with a healthy dose of continuous learning. In this way, you’ll stay on top of your game and truly know all there is to know about real estate investing. Gather knowledge and advice from a variety of sources, including real estate textbooks to learn the fundamentals, in-person mentoring to learn the intricacies, and trustworthy news articles to learn the ins and outs of your local real estate market. Join a professional organization to become part of a community centered around your collective success. Use social media networks wisely and fact-check yourself as you come across dozens of statistics and figures every hour. Most importantly, never stop learning as the real estate investment industry is constantly on the go. As a real estate investor in today’s ever-changing world, you will find that you constantly rely on many different tools in order to stay abreast in all topics relevant to your world.
Charles Carillo is the founder and managing partner of Harborside Partners. He has extensive knowledge in renovating and repositioning multifamily and mixed-use commercial real estate. Prior to launching Harborside Partners, Charles founded an online payment processing company with partners and clients in 4 continents across the globe. Charles holds a BS from the Connecticut State University.