10 Team Members Every Real Estate Investor Should Have

All great real estate investors rely on a team of industry professionals to help them manage and grow their portfolio. Successful investors know that they are really business owners (or partnered with businesses like Dwell Logic). Any successful business owner will tell you that it takes a team to run a successful enterprise. One person armies tend to burnt out and quickly fail. As your portfolio grows it eventually becomes impossible to be everywhere at once and specialize in every aspect of a business. However, it’s totally possible for one person to “wear more than one hat” and fulfill several of the roles described below. But the larger your portfolio becomes the more important it becomes to have specialized individuals that are experts in their chosen profession.

This is one of the biggest advantages to working with a seasoned investment firm like Dwell Logic. We already have that team in place and have vetted them with our previous business dealings. Acting on bad advice from any one of the team members listed below can ruin even the best real estate investing deals. By investing with Dwell Logic you avoid the required effort and growing pains of building and managing your own team. Instead you can focus on your regular life while we handle all day to day work required. This is why an investment with Dwell Logic is a truly passive investment.

It’s not uncommon for one person to fulfill more than one of the roles described below. For example, many property managers also have a license to sell real estate like a regular realtor. Many small investors successfully fulfill a lot of these roles themselves. That can be the best way to learn about each and be prepared to step back and focus on managing and leading their team later on when their portfolio has grown, and they need to delegate to individual specialists.

1. Property Manager

Property managers handle all of the day to day tasks associated with managing tenants and coordinating routine maintenance and repairs. They have quite a broad scope of work and handle everything from tenant selection and management to coordinating routine maintenance and repairs. Often, they collect the rent for their clients and handle difficult situations like evictions and tenant conflicts. In essence they handle most if not all of the interactions with your tenants and contractors. Great property managers prevent a lot of problems from ever occurring and are instrumental in identifying and retaining the best quality tenants. Typically, they are compensated by charging a percentage of the gross monthly rents. These charges can add up fast and take a big bite out of cash flow. This is why many investors with smaller portfolios choose to self manage.

2. Mortgage Broker

While it’s possible to strictly deal with the big 5 banks and some secondary mortgage lenders directly, it’s very difficult to successfully negotiate with them or even know if you are being offered the best rates and terms. This is where mortgage brokers come in. It’s their job to act as an intermediary between you and the lender. They can offer your business to a variety of different lenders and negotiate on your behalf to help ensure you get the best possible interest rate and contract terms. They also have access to many different lenders and are not limited to the major banks.

The best part is that in most cases they charge a commission to the lender and not the borrower (i.e. you). That means you get to take advantage of their hard work and expertise for free. Mortgage brokers can also be an excellent source of advice and many provide regular updates to their clients on the current mortgage lending market conditions. This can help you identify the best times to re-finance your properties and plan for your next purchase or sale.

3. Realtor

Realtors are invaluable for locating deals on the MLS and accessing otherwise exclusive MLS data. They should also be experts on their chosen region and its unique real estate market. It’s very time consuming to constantly keep tabs on a changing market and the flux of properties listed on the MLS. Realtor’s handle this for you and can also be great sources of more general information and advice.

4. Real Estate Wholesaler

Wholesalers are a key resource for finding great off-market deals. There are strategies you can employ yourself to find great off-market deals too! However, full-time real estate wholesalers are the experts at doing this and oftentimes they will find and lock down great investing opportunities before you ever hear of them. It’s better to have them on your side and bringing you great deals. Some people get turned off by the idea of involving a middleman and paying someone else just for the privilege of being able to purchase a property from a seller. It’s important to keep the big picture in mind and recognize that that if the wholesale deal has better overall returns than it is still a better deal overall and worth pursuing. An extra few thousand dollars in wholesale fees is a small price to pay for a truly great property.

As an aside: wholesaling can be one of the most difficult and risky ways to make money in real estate. It requires a good working knowledge of all aspects of real estate investing. Failing to account for any factors or underestimating the cost of repairing a property can lead to the wholesaler overpaying and/or becoming stuck with a bad property they can’t pass on to a final buyer. If this happens, they can lose tens of thousands in short order. A lot of newbie investors dabble in wholesaling because you don’t need large amounts of seed capital to get started. Instead I recommend that you try to build with relationships with the people that have succeeded at building full scale wholesaling businesses. They are most likely some of the most capable and experienced real estate investors in their chosen region.

5. General Handyman (or Handywoman) Contractor

These are the individuals that take care of small repair jobs and maintenance. Typically, a “jack of all trades” a good handyman contractor knows how to fix all manner of small issues in a house. Sometimes you just don’t have time to go fix a leaky faucet or replace the flooring in a single bedroom in the short time between old tenants moving out and new ones moving in. This is when having a great handymen on your side is essential. They can handle all for the smaller construction type jobs in a professional manner and help free up your time to focus on whatever it is you do best. Your property manager should have a great relationship with several local handymen and be ready to contact them at the drop of a hat.

6. Specialized Trades

Sometimes the job is too big or complicated for a single handyman to tackle. In these cases, you will need to call on specialized trades people like plumbers, electricians, carpenters etc. In many jurisdictions there are laws that require the use of a certified trades person when dealing with things like plumbing or electrical systems that could affect the safety of occupants. It’s a best practice to always hire certified trades people when working on such systems. The potential danger to your tenants and risk of structural damage to your property far outweigh the added costs.

7. General Contractor

It’s important to have a good relationship with experienced contractors that can handle medium to large scale renovation projects. Your handyman (or handywoman) can handle something small like replacing a vanity or leaky faucet. Renovating an entire house or even a smaller project like a whole kitchen or bathroom remodel is a much more complex project that will require someone that can coordinate multiple trades workers. It’s absolutely possible to take on these projects yourself if you have the DIY skills and inclination.

However, getting the best results and getting a project complete on a tight timeline almost always requires a true pro that specializes in this sort of thing. This becomes doubly important when you are trying to implement a BRRRR of fix and flip strategy where the property doesn’t provide a return until after the renovations are complete.

8. Appraiser

A lot of people overlook appraisers at first, but they provide an extremely important function within the real estate industry. Lenders rely on appraisers to ensure that they don’t lend more money against a property than it’s worth. This means that it’s difficult to sell a property for more than its appraised value. Extracting equity/capital from a property via a mortgage refinance or home equity line of credit (HELOC) is impossible if an appraiser can’t confirm to the lender that the property is worth a certain percentage more than the amount your are attempting to borrow. See my post on the BRRRR investing strategy for a more thorough explanation of this process and why appraisers are so important.

Appraisers can also be great sources of real estate knowledge and advice. Often they can be hired to complete specific real estate analysis for a consulting fee. Sometimes it makes sense for an investor to hire an appraiser to inspect a property to give them an up to date estimate of fair market value or to estimate the change in value specific renovations and/or zoning changes would cause. Accurately estimating the current/future fair market and after repair values of real estate is one of, if not the most important skills a real estate investor must master. Appraisers are literally the experts at this and there is a lot that most investors can learn from them.

9. Lawyer

Buying and selling real estate is a complex legal process. To say nothing of the intricacies of tenant and landlord law that each province regulates! Anytime a transfer of title and a large sum of money is involved, it’s smart to work with a lawyer to ensure the details are handled correctly. Your lawyer can also offer advise on all manner of problems and issues related to property transfers and the contracts used to purchase, lease, and/or sell real estate. As your portfolio grows in size your lawyer can also help you decide whether or not it makes sense to incorporate and what the legal ramifications of that will be.

10. Accountant

We have all heard the saying that two things are certain in life: death and taxes. Since you can’t escape paying taxes you might as well make the best of it and ensure that you take advantage of every potential saving! Accountants are experts at this, and no one is better equipped to help you with this than a qualified CPA. An accountant can help you with way more than just taxes though! They can also help you understand, organize and optimize every financial aspect of your real estate investments. Working with an accountant is essential to maximizing your after-tax profits. Turbo tax is great but savvy investors know that an accountant brings a lot more value to your business than they cost in fees.

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