How to Find Real Estate Investors in Your Area

If you are new to real estate investing, one of the first challenges you must tackle is finding the capital to purchase properties. Unlike a home that you own and occupy, investment real estate is often harder to finance because banks consider the purchase riskier. So, how do you find real estate investors? Fortunately, you have a few options to find financing for your real estate investment opportunities.

Bank Financing

Just like with a traditional home purchase, banks do finance real estate investment properties. However, because they consider these types of real estate deals a higher risk, banks usually require a larger down payment and a higher interest rate.

In addition, if you’re investing in a multifamily property with a larger purchase price, it could be even harder to meet the bank’s requirements. Consider all of your financing options, but you may find with real estate investment that a private investor is a better option.

Private Real Estate Investors

A private real estate investor is either an individual or a business that’s not a bank. Private investors are more relationship focused and offer an opportunity to create a partner relationship.

One benefit of a private investor, especially when you’re new to real estate investing, is the opportunity to find a mentor to help guide you in learning about your new business venture. However, there are some challenges with financing with private investors. The loan period is usually shorter meaning you’ll have to make a return on your investment more quickly. Also, with private investors you don’t benefit from some tax breaks that you may be eligible for with traditional financing.

How to Find Real Estate Investors

The two main ways to find real estate investors is through real estate investment clubs and networking. Also, don’t underestimate the power of an internet search to help you find potential investors.

Real Estate Investment Clubs

Real estate investment clubs are a great way to connect with other real estate professionals including financial investors. Most areas have local real estate investment clubs tied to larger national organizations like the National REIA. While the internet offers many opportunities to connect online, making in person connects is still the best way to build relationships.

Real estate investment clubs allow you to learn from other experienced professionals. People across the real estate market like agents, property managers, contractors, attorneys and investors are members of real estate investment clubs. This is a great opportunity to find and connect with real estate investors.

Before you join a local club, do your homework. Research the organizer, find out how often the club meets and read online reviews about member experiences. Make sure that the group you join is a quality club. Also, most real estate investment clubs offer seminars to allow you to learn more about the club before you join.

Networking

Just like with finding a job, networking leads to opportunities. Let your personal and professional networks know that you’re seeking real estate investors. You might be pleasantly surprised to find that friends or family will invest in you. Also, consider contacting local real estate agents to inquiry about investors. Often, real estate agents have a vast network of connections including real estate investors. They’ll usually share connections in the hopes of creating relationships that benefit them with future deals.

Close the Deal

Once you figure out how to find real estate investors in your local area, be prepared to build a trusted relationship. The first step in building trust is to present your business plan. If you’re prepared with a solid business plan, potential investors are more likely to listen.

A solid business plan creates a foundation to demonstrate your real estate goals and strategic vision. Don’t blow your opportunity to partner with an investor. Close the deal by showing that you take real estate investment seriously.

If you’re ready to take your real estate investing to the next level, contact Laura Alamery to learn more about real estate coaching opportunities.