Reducing risk in a real estate transaction involves using a proven checklist for the purchase of real estate and analysis of real estate value. Furthermore, it involves educating yourself on the fundamentals of real estate investing and real estate value analysis.
This post was written by our partner Jordan J. Etem, a Realtor with Intero Real Estate Services in Los Altos, CA.
Find reliable people for your real estate investing team
San Francisco and the Silicon Valley are very hot markets. If you can afford to invest in the bay area, the market has been relatively stable for the long-term. Will that continue? One can’t say for sure, but from personal experience, rental properties in Silicon Valley are receiving multiple renter applications in many cases in today’s market. Getting referrals from these critical team members will give you a better picture of the help available to you in the process of acquiring and holding real estate.
Critical team members:
- Title, Escrow and Closing team
- Realtor partner reliable in area of investment
- Real estate inspectors and appraisers
- Property management
Location and tenants are essential
Good schools and steady employment in areas with a robust rental market are certain criteria to search for. I would recommend thinking about your personal situation. Your stage in your career and various other factors that will determine your budget and real estate investing strategy. Prepare yourself for unexpected things to happen.
For problems to arise with tenants, it’s normal for the unexpected to happen in the marketplace. All the experts totally missed the 2008 real estate crash. It was a time of exuberance and excess and deception. These problems can come up. Prepare yourself if you are going to manage the property yourself or work with certain property management companies.
Choose professionals that guarantee their work
Professionals that make and fulfill promises is the standard that an investor should take. Services such as Onerent set business operating standards that guarantee rental payment for investors. When an investor signs up for Onerent, they get a very straight-forward service at a competitive price with essentially insurance in case of an eviction or long vacancy period.
Many investors get consumed in the back-end work required to manage rentals so they are really not “free” or financially independent. To deal with the unexpected challenges and standard maintenance of property, having a rental service from a trusted third-party is an essential risk mitigation strategy.
Think about it, a property manager is tasked to manage the property, and in the perfect world, the manager would be highly skilled at management, having practiced the trade for many hours and improving continuously.
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About the partner:
Jordan Etem is a Realtor with Intero Real Estate Services. Born and raised in Silicon Valley, Jordan offers innovative, modern services for real estate clients selling or buying real estate. Clients benefit by having access to a long-term partnership and network of talented people that can help clients broadly, beyond the transaction.