Build an Unstoppable Real Estate Portfolio with the “Core 4” (Ep: 481) | BiggerPockets Real Estate Podcast with David Greene & Brandon Turner

Check out BiggerPockets Real Estate Podcast Episode Page and Show Notes

Key Takeaways

  • As an entrepreneurial real estate investor, having chemistry between your agents, contractors, lenders, and property managers can be incredibly valuable for time, and money management
    • Progress in real estate is hard to make without an expert team, solve your problems by asking “who” and not “how”
  • Find your agent first. They usually have a large network to connect you to lenders, contractors, and property managers
  • Be motivated in your real estate investment pursuit, communicating a good plan can be just as valuable as having a large amount of down payment money
  • Have a good database of contractors built up to plan for problems before they arise
  • Good lenders partner with your real estate agent
    • Communicates the context behind the real estate purchase and creates confidence around the ability to pay loans
    • Don’t shop lenders, leverage your referrals to get all the pros and cons on the table right away, give them permission to be honest
  • Good property managers rely on a system and maintain consistency in their process

Intro

Agent/Deal Finder

  • Progress in real estate is hard to make without an expert team. Solve your problems by asking “who” can solve my problem and not “how” can I solve the problem
  • Why and how do you choose an agent?
    • First person you want to assemble, usually has the biggest network and access to the other parts of the real estate investment team
    • Agents bring you “on-market” and present you with more opportunities
    • Quantity is important, agents who are top-producers are traditionally more worthwhile
    • ON FIRE – organized, networked, focused, investment-savvy (understand what you care about), responsive, experienced
    • Agents should have a clear definition of their strengths and weaknesses, awareness is important
    • Understanding of the current value and growth potential of the house/neighborhood/city
      • Look for signs of “hipsters”- find the coffee shops, breweries. Also, look for the job demographics of the area.
    • Remember that you need a good agent more than they need you, you are one of many people looking for a good deal in a hot market
  • Find an agent or learn more at biggerpockets.com!

Being a Good Client

  • Motivation – do you want to buy a house or would you like to buy a house? Establish your goals upfront.
    • Communicating a good plan can be just as valuable as having a large amount of down payment money
  • Understand that agents get paid on their results, not their time
  • Understand that you, as a real estate investor, will make more than the agent on the transaction over a 10-year period

Contractors

  • Urgent availability and quick communication can sometimes be a red flag. It might be a reason they are not busy
  • “Dig a well before you’re thirsty” – Brandon Turner
    • Have a good database of contractors built up to plan for problems before they arise
  • “If I had 6 hours to cut down a tree, I’d spend 4 hours sharpening my axe” – Abraham Lincoln
    • Putting in the work early with contractors will be worthwhile in the long-run
  • The best contractors will give you guidance and cost/benefit analysis rather than just asking what you want
    • Some contractors will have biased pricing, if they have bad knees they might not enjoy doing tile flooring and price it out as an option

Lenders

  • The lowest interest rate isn’t always the best option
    • As rates go up, they can charge a better closing cost
    • With low rates, you’ll find a lack of experience or a lender who has cut out the middle man, good underwriters save you money in the long run
  • Good lenders partner with your real estate agent
    • Communicates the context behind the real estate purchase and creates confidence around the ability to pay the loan
    • Ask the agent’s preferred lender
  • Unfortunately, most lenders are salespeople
    • All lenders say yes, why is it in their best interest to do so?
      • They often rope you in and give you the bad news later
      • Don’t shop lenders, leverage your referrals to get all the pros and cons on the table right away, give them permission, to be honest

Property Managers

  • Good property managers rely on a system and maintain consistency in their process
    • Leave very little room for problems to arise that don’t have a planned or automated response
    • All property managers seem good until something goes wrong
    • When qualifying a property manager, ask about the bad things: evictions, maintenance, late rent, etc.
  • Customer service is very valuable to tenants
  • Hire slow and fire fast – value track record of your property manager over them being “nice”
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Notes By Drew Waterstreet

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