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Friday, February 11, 2011

What to look for in a real estate investment group

Real estate investment groups
REIGs allow investment options that are otherwise restricted
The primary things to look for in a real estate investment group are the quality of management services, discounted investment property, housing and real estate expertise and a clean financial and legal record.

Real estate investing groups can be members of a real estate investment associations and/or clubs. They are similar to construction companies that also provide administrative services for rental real estate. The investment group profits from the sale of properties it builds in addition to management fees attained thereafter.

Unlike real estate investment clubs and associations, the real estate investment group focuses less on bringing together the many participants of the real estate industry such as agents, brokers, builders, investors etc.

Key benefits of real estate investment groups


The major benefits associated with investing in property built by real estate investment groups. One or more of these benefits may also be available through a real estate investment club. If a real estate investment group cannot make these benefits possible at some level, they may no be worth investing with.

Property discounts: Since the investment group may build multiple properties, apartment complexes and/or large residential facilities, they may be able to offer the properties to investors for a lower than market value price.

Administrative services: The property management services provided by the real estate investment group allow the investors to work and otherwise not have to worry about the day to day operations of their investment.

Housing and rental expertise: Allowing the real estate investment group to manage the property they have sold give the property investor a chance to benefit from the groups possible know how and skill in soliciting, acquiring, retaining and managing tenants and their residential needs such as maintenance and repairs.

Legal and financial standing: Due to the high amount of regulation in housing, it requires a certain amount of legal and financial responsibility to sustain a real estate investment group. A professional and well organized real estate investment group should be able to deal effectively with issues such as zoning laws, liens, eases, unpaid property tax, title searches, property maintenance requirements etc.

Additional tips on investing with real estate investment groups


Real estate investment groups can be located through contact with real estate investment associations, professional referral from persons in the housing industry, real estate attorneys, and other sources.

Real estate investment trusts (REITS) can also be considered real estate investment groups if the property these companies own include managed property. A few more tips one might investigate and/or think about before investing with a real estate investment group are as follows:

• If the investment group has a large volume of non-rented properties and/or high turnaround in residences it manages there may be a management problem.

• The investment group may be a start up, internationally owned and/or a private company. Such being the case, it may prudent to ask a lot of questions to assess the know how, credibility and ability of the group for the purpose of protecting the security of one's investment choices.

• Contacting investors clubs, talking with professionals in the real estate industry may assist in finding recommendations and advice regarding real estate investment groups.

• Researching rental and housing economic statistics in the regions one plans to invest in may prove beneficial to the soundness of an investor's decision.

To summarize, real estate investment groups may be a profitable decision if the above criteria and tips are considered in the process. Property investment involves significant amounts of money and thus is ideally well suited to prudence and caution.The benefits of real estate investment groups can provide, may lead to profit and the peace of mind that goes along with sound management of one's investment.

Image license: Scott Maxwell, CC BY-SA 2.0