All Forum Posts by: Derek Newton

Hi Paul, welcome!  

Aaron makes an excellent point. There are multiple factors to consider, especially in Los Angeles where not only are there sub markets and pocket neighborhoods, but also hubs that drive variation in rent (consider hipster stretches in Silverlake, Highland Park, Echo Park, etc.). As all markets have their differences, it is difficult to quote increases in other places. Make sure you are comparing apples to apples with both the market and the property itself. True comps are the most difficult to find and may require some ingenuity on your part. While schools are a driver for rent, they are only one piece and may not even apply to your target market. This will depend on the property type itself also. When I analyze properties for clients, I look at geography, demographics, walkability, and property features including size, condition and amenities. It helps to physically drive those areas when possible and call any for rent signs to inquire about price and amenities, You might also consider calling local property management companies. Hope this was helpful. 

In considering property management companies, look for developers that manage and lease their own properties. They often require full time analysts in which they pay salary. However, the preferred experience would likely be with a company the syndicates deals. Your finance background would work nicely with such a company as they often rely on creative finance strategies to attract investors, and then collect a promote (management) fee in addition to equity. Although more difficult to find, RE syndicates can often lead to great exposure in finance, development and management. Just remember that many CRE firms are dynamic and offer multiple services. When scouting and interviewing, make sure you discuss what it is you're looking for upfront to decrease your chances of being stuck in the wrong area. Also, if you do decide to become an agent, more and more firms are offering a draw incentive whereby they pay their agents a salary initially (typically in the $30k - $50k range) and recoup their cost through your sales. This is to provide income during the 2-5 years it takes to build clientele. Just make sure you do your homework, ask around, network and you'll be fine.