How to Help Your Clients Become Real Estate Investors

Historically, investing in real estate has been one of the most effective ways to find financial freedom, especially in the Chicagoland area. It’s a smart way for people to build generational wealth and diversify their portfolios. 

It’s a unique asset class that has lower volatility than stocks and offers a safe way to hedge against inflation or uncertain times. Responsible real estate development can revitalize and strengthen communities by boosting property values and tax revenue, leading to better public services and success for locally-owned businesses.

Most brokers join this industry because they are driven to help match their clients with the perfect home for their family or find the ideal location for an innovative commercial enterprise. 

You also have the power to guide your clients toward making advantageous financial decisions. Here are some smart strategies for encouraging your buyers to become real estate investors and boosting your real estate brand to the stratosphere.

Become a Subject Matter Expert

In the business world, an SME (subject matter expert) is a highly qualified professional who has advanced knowledge in a specific field

Finding your niche is key to establishing your reputation as a trusted advisor. Whether you specialize in a certain area, historic buildings, or multi-family dwellings, doing your research and staying in front of current market trends is vital.

Chicago’s 77 community areas each have a distinct flavor and possible opportunities for residential or commercial investments. In-depth market analysis utilizing the latest AI-powered technology will give you the data you need to steer your clients to the most potentially profitable properties. 

You should also be aware of upcoming development projects, zoning ordinance changes, economic policies, and how to evaluate deals and estimate cash flow. 

The National Association of REALTORS® provides a certification program in real estate investing that takes a deep dive into 1031 exchanges, NOI (net operating income) modeling, and practical insight into professional property management.

By developing your expertise, you’ll inspire homebuyers to expand their horizons and explore the possibilities of building wealth through this type of investment.

Educating Your Clients

The next step is to sit down with your clients and truly understand their goals and financial situation. Many potential homebuyers are unaware of the options available to them or the safety and tax benefits of purchasing property as an investment.

Commonly called “house hacking,” many motivated investors start out by earning income through renting out part of their property (such as accessory dwelling units like basement apartments or separate mother-in-law suites) or by living onsite in a residential building and acquiring tenants for the other units.

This rental income can reduce or eliminate housing costs while building equity and allowing your client to save money for additional investment properties. 

You should advise your buyers to work with a lender who will work with them to find financing options specifically available for investment properties and owner-occupied multi-units. The qualifications for multifamily property mortgages are different than those for single-family homes but definitely still achievable.

For example, the Federal Housing Authority (FHA) guarantees mortgages with lower down payment requirements that are specifically designed for those with lower income or credit scores. Buyers can use this program to purchase a property with up to 4 units, as long as one will be their permanent, full-time home. 

Properties with 5 units or more are considered commercial real estate. If your clients are considering taking this route, they’ll need to have good credit and be prepared to make a larger down payment. Commercial mortgage loans also may have shorter terms than conventional residential mortgages — typically 5 to 20 years. 

These kinds of properties are also usually listed at a higher price point than residential ones, but they also generate more revenue, which makes it easier to grow your portfolio. There are many different types of commercial real estate, but these are traditionally the most profitable:

  • Apartments
  • Flex space (multi-use light industrial)
  • Self-storage
  • RV/ motor home parks
  • Strip malls with a balanced tenant mix
  • Student housing

Being a landlord isn’t for everyone, however. Be sure to talk to your clients about their lifestyles and expectations. Some people are ready to be fully hands-on, and some would prefer to let someone else handle the day-to-day oversight and dealing with repairs and maintenance. But property management companies can take a huge bite out of investment property income, so it’s crucial for your client to factor those expenses into their plan. 

Best Practices

Effective negotiation tactics are especially critical when it comes to sealing the deal on investment real estate. Honing your skills and specializing in this kind of transaction will give you valuable expertise and nurture your business. 

It’s vital to offer ongoing support to your clients throughout the process. Providing regular updates on market trends, answering questions, and offering guidance will make your clients feel more confident in their investment decisions and their plan for the future.

Be transparent and upfront with your buyers about the risks and rewards of investing in real estate. This is critical for building trust and establishing yourself as a trusted and reliable partner. 

At Baird & Warner Lincoln Park, we give our brokers every possible advantage to ensure they exceed client expectations. We leverage the latest property management and CRM technology to build a highly unique platform for our top-performing team. 

Discover more about finding success in an exciting and prosperous industry at the largest independent brokerage in the country — reach out today!

How New Brokers Can Overcome Impostor Syndrome

Impostor syndrome is a psychological phenomenon that causes high-achieving individuals to doubt their accomplishments and abilities. It’s common among new real estate brokers, and it can be a major roadblock to reaching your goals. 

The feeling of not belonging or not being good enough can be overwhelming, and it can prevent those just entering the industry from reaching their full potential

However, with the right strategies and support, you can overcome this mindset and become a real estate superstar. Here are a few insider tips for gaining the confidence you need to succeed from our experienced management team.

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How Brokers Can Create Healthy Habits – And Stick to Them

Thriving real estate brokers are always on the go and juggling multiple tasks; it can be difficult to develop and maintain healthy habits.

A balance between work and life is crucial to your success in this industry. That means you need to cultivate dedication to making good choices and working toward positive changes both personally and professionally.

Investing in yourself and your business is always worthwhile. Let’s dive into some science-based strategies and approaches that help you break away from unproductive patterns and establish more nourishing routines. 

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7 Daily Activities Real Estate Agents Can Do to Grow Their Business

Real estate is a competitive industry. To find success, you’ve got to be passionate and tenacious.

The Chicagoland market outlook for 2023 is relatively sunny, but brokers will still face certain challenges, including a lack of inventory. Client education and setting realistic expectations for both buyers and sellers are must-do moves for thriving in the New Year.

Structuring your day in the right way can send your real estate biz to the stratosphere, so we’ve gathered some insights from top agents and industry thought leaders on the best daily practices you can adopt to grow your business and extend your reach.

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Content Marketing: Pro Tips for Real Estate Agents

They say “content is king,” which might be a bit of hyperbole, but there’s no denying that creative and relevant content is a guaranteed way to drive traffic to your real estate business website, outshine your competition, and generate solid leads. 

Content, in this context, can and should include video, photography, and written content, and leaves the door open for other current and emerging elements, like infographics and renderings. 

Many agents are good, and getting better, at preparing visual content (think video and images on social media), but where they’re missing loads of opportunity is in written content. 

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Things I Wish I’d Known Before I Started My Real Estate Career

Life as a successful real estate professional can be exciting and fulfilling — but there are also certain challenges that aren’t covered during your 75-hour pre-licensing course.  

While the managing broker who sponsors your license application will serve as an invaluable teacher, it never hurts to be as prepared as possible. 

If you’re thinking about transitioning to the real estate world from another career, you might not be aware of these insider tips, so we’ve put together this handy compendium of advice for you from experienced industry pros.

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Transitioning to Real Estate from a Full-Time Job

Making the leap from a full-time job into the exciting landscape of the real estate industry is exhilarating and could lead to the financial freedom you’ve always wanted.

But like any massive decision, it’s best to learn as much as you can about what awaits before you dive in.

That’s why we’ve put together some insightful advice to ensure you’re as prepared as possible to transition from a regular worker to a highly motivated and independent business professional. 

If you have a specific question that’s not addressed below, please feel free to reach out to us directly and start a conversation. 

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The “Best” Mistakes to Make as A New Real Estate Agent

As a new real estate agent, you’re bound to make a few missteps when you first embark on this exciting journey. But it’s always smart to be proactive. 

It’s human nature to make mistakes, but they present a beneficial opportunity to learn and grow. It’s even better to learn from the mistakes of others before you waste valuable time and energy. 

That’s why we’ve put together this crucial list of lessons from industry thought leaders which will serve as a road map to success so you can avoid these common pitfalls and thrive in your chosen career

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How To Prepare For The Illinois Real Estate License Exam

Passing the real estate licensing exam is the first step on the road to your successful career in real estate. But passing the exam itself can seem like a big hurdle. Are you ready? The good news is that a lot of the techniques you apply to the real estate license exam — great study habits, a systematic approach to the exam, and a thorough understanding of the subject matter — will serve you well in your career as a broker or agent. Learn more about the Illinois Real Estate Exam and how to prepare yourself for success.

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