A real estate portfolio is a collection of your assets, how they are managed, and the steps that were taken to reach a certain financial goal. If you’re interested in real estate investing, then here are some tips to help in the process of creating an attractive real estate portfolio according to industry expert Craig Nassi.
1. Create an Objective
Before you work on your real estate portfolio, you need to come up with an objective. What do you want to achieve? Various investments work differently at different times. So, it’s important for you to have your end goal in mind before working on your assets.
Your portfolio won’t fail because of one investment, but the combination of assets and risk factors can negatively impact it. Once you come up with an objective, you can focus on the real estate investments you want to include in your portfolio. Some of those investments may include multi-family properties or rental properties that allow you to achieve some sort of passive income. There are other assets such as rehabs and wholesaling which can help you achieve your short-term goals.
2. Know Your Market
Now you can do a complete analysis of the market. You may have a community or neighborhood in mind, but you should broaden the market to reach more potential properties. Decide which properties are within your selling range. Most of this research can take place at the courthouse or library and can help you determine which homes are currently on the market. Since your “investors” are the common buyers, you’ll want to know what other markets these buyers are tapping into.
3. Analyze the Competition
Now it’s time to break down your research on your market area. Determine where most of these rentals are being marketed. Is it online, print, or both? Is it on Craigslist or real estate listings? Keep all of these factors in mind. When you’re researching your community or neighborhood, find out the rental amounts for the properties you’re interested in buying. Which ones are available? Which ones contain free incentives? You’ll need these details for your real estate portfolio.
4. Asset Allocation
Another important feature of your real estate portfolio is its asset allocation. This allows you to determine the right allocation model for your specific goal. You’ll need to come up with a multitude of assets that have the highest chance of meeting your goals, but also some which come with a higher level of risk and corresponding reward.
5. Handle Management
The next component of your real estate portfolio is the management section. In this section, you should determine if you should hire a property management firm to handle the investment or if you want to become a landlord of that property. This information is not only for lenders, but also for your bottom line. Whether you assign a property manager or not, your real estate portfolio should address how these investments are being managed along with the associated costs.
6. Tackle Expenses
Speaking of costs, you need to address the expenses. Expenses include budgets, insurance, real estate taxes, repairs, etc. If you settle on a below-market value, then you can say goodbye to your profit. While the condition of your properties is a separate factor, you’ll want to include a budget for impending repairs for some of those properties.
These steps should help you create your real estate portfolio. Investing in real estate is a must these days and starting a real estate portfolio on the right foot is crucial, says Craig Nassi.
Born in New York City, Craig’s prestigious education lead him to Colorado, where he received both his bachelor’s and master’s degrees. He then pursued a career teaching social studies and coaching three sports. Teaching and coaching have always been a passion.
Immediately after ending his teaching career, Craig obtained a real estate license to pursue a career in real estate sales and marketing. The process from there evolved into BCN as we know it currently. Today he continues to mentor youth in the community and guest lectures at local universities and various organizations such as YJP (Young Jewish Professionals – of NYC). Craig is an avid health enthusiast, runner/marathoner and lives in Manhattan with his lovely wife Sharon and three beautiful children.
