As a new real estate investor, you may wonder where to start. Should you be looking at neighborhoods? Should you be finding funding? Should you be learning about renovations? The answer is that although you need to start focusing on all of these things, the best way to do that is to surround yourself with the right people who have the answers to your questions. The very first thing you should do is invest time creating a network.
The truth is, in real estate, it isn’t so much what you know, but who you know. Who has a good deal? Who has money to lend? Who understands the rental market in a particular neighborhood? Who can provide a realistic estimate for a new roof? Who understands the tax implications of a potential multi-family purchase?
Real estate investing is not something you do entirely alone because it is a relationship-based business. When you invest, especially if you are investing in a particular area, you will come to find that it is, indeed, a very small world. People know one another, value one another, and work together on deal after deal. If you don’t have these connections, you will not be as successful with your investments as you would have hoped.
The best way to find the support you need is through networking.
With Whom Should You Network?
There are many people who should be on your networking list. Although lenders and realtors should be on the list, you need to think beyond to people such as:
- Other investors
- Contractors and subcontractors
- Property managers
- And more
The more you can connect with people who are already involved in real estate, the more you will be able to learn and create the bonds you need. Then, when it is time to make a real estate purchase, you will have a working relationship with people who will be able to help you.
How To Network
The reason the word “work” is in networking is that it takes effort to create the relationships that will lead to great connections for your business. Let’s look at the three phases of networking to see what you will need to do.
- Phase One: Get in front of the right people. Have your business cards ready. Be able to tell others what you do in a 30-second elevator pitch. Learn how to listen. Always ask what others do and what they need. The focus at this stage of networking is to meet people and begin building relationships.
- Phase Two: Look over all of the business cards and contact information you have collected. Which contacts had an immediate connection? Whose objectives were similar to yours? Who had a business that would work well in conjunction with your own? These are the people you should work to build a relationship with. Call them and get to know them over coffee or a meal. Don’t focus on a business transaction. Simply focus on getting to know them better. Also, during this phase, do what you can to help the people on your list. Be the person for them that you hope they will become for you.
- Phase Three: Now that you are seen as an information sharer and helper, people will come to you. At this point, you are well-connected.
Three Tips To Help You Start Networking
Getting started networking is not hard, but it will take some persistence. Here are three things to keep in mind as you begin investing in your network.
Tip #1: Networking Takes Time
Some people assume that they can go to one networking meeting, shake a few hands, hand out business cards, and be set. The truth is that networking is a process that takes time. Those people that find that networking doesn’t work usually stop at Phase One. They go to meetings and collect cards. They talk about themselves and listen. Then they repeat it again at the next meeting. Real networking may begin at a meeting or event, but it never ends there.
Tip #2: Get Involved in Real Estate Investing Clubs
Real estate investing clubs are designed for the purpose of networking. They bring people together, either in person or online, that have an interest in some facet of real estate investing.
There are many real estate investing clubs you could choose from, but you won’t have the time or the need to join them all. Instead, you’ll want to find a club that meets your needs. A good way to do this is to contact the founder or president and ask some questions about the members and the focus of the club. Although joining an online club is an option, having at least one local investing club would be preferable as you try to hook up with needed providers.
Tip #3: Don’t Stop with Real Estate Investing Clubs
Some real estate investors join an REI club but never look any further. Don’t make this mistake! There are many other groups in your local area where you can meet the right kinds of people and learn about great deals, such as:
- BNI -Business Networking International
- Chamber of Commerce
- Convention and Visitor’s Bureau
- Lions Club
- Local Merchant Associations
- MasterMind Groups
- Rotary Club
- Women in Business Networking
Tip #4: Develop a Strong Elevator Speech
Although you will want to listen more than you talk, you do want those you meet to know what you do. That’s why an ‘elevator speech’ is so important. You should be able to describe what you do in one to three sentences stating the who, what, and why of your business. Once you have this down, you can tailor it to suit specific networking events
Networking is one of the most important things you can do in order to get involved with real estate investing. When you network, you establish yourself as an investor, connect with people who could help you, learn more about investing, and so much more.