Every career field has a required skill set for success. This is especially true in real estate, a multi-faceted industry that relies on a combination of people skills and technical knowledge. Not only must you understand how to build strong relationships and negotiate deals, but you also need a baseline knowledge of home construction, economic trends and changing property values.
The members of Forbes Real Estate Council have established successful careers in the industry and understand what a real estate investor or developer must do to thrive. Below, they share nine critical skills other up-and-coming professionals in the industry should hone to advance their careers.
One of the most critical skills for a developer is to have a unique unit/concept with some form of storytelling. It can be through truly unique features, such as a “starchitect” or a building associated with a famous luxury brand name. Good developers know properties need quality finishes, not just fancy appliances or “state of the art “amenities that look nice on a brochure. Such details can be a smart and logical layout, quality doors or A/C vents, faucets and thermostats that don’t look purchased straight from Home Depot. Many of the small details are not necessarily expensive but make a true difference that gives the feeling of a complete home. – Adam Redolfi, Barnes International Realty
Engineering knowledge is important. Understand density rules and regulations or have experts on hand. Pro-forma and financial projections are necessary so a developer can balance budgets and have the foresight to plan and execute and mitigate cost overruns. – Ben Bacal, Rila Inc.
3. Structuring A Deal
Especially for a new investor, structuring a deal whereby they are not using a bank or their own cash (other than $100 deposit) or signing personally on any loans is the best route. This leaves structuring options of lease purchase or owner financing. – Chris Prefontaine, Smart Real Estate Coach
Being organized is a critical skill to be a successful real estate investor. Real estate is a great way to make a high return on your money, but it requires you to actively manage your properties. So if the person is not interested in actively being involved in their investment, I would recommend against them becoming real estate investors. Many people do not realize this is an active investment and it will take time to really pay off. These are the two main factors that lead investors to grow frustrated and “tap out,” saying this is not for them. If they come into the opportunity fully understanding these two things, they will be much more successful in the long run. – Oliver Seidler, PropertyForce
To be successful in real estate, you must have the skills to build a good team. There are too many tasks to do well by yourself. From property managers, brokers, architects, engineers, contractors and a myriad of other professionals, you must be able to vet and motivate your team to perform at the highest level. – Jason Hsiao, Shaw Investments
6. The Ability To Pass On A Deal
Most new investors want to do a project so eagerly that they involve themselves with margin investments and end up working for “free.” Take your time, don’t “under analyze,” and wait for that perfect opportunity that has enough margin for you to make money, even if there are time delays, unforeseen repairs or other unknowns. If you are new, always increase your budget estimate by 30%, double your needed allocated time to do the project, and double your projected time to complete and sell the home. If the deal doesn’t pencil with these extra dollar and time allocations, then pass. – Anton Danilovich, TopHap, Inc.
7. Identifying Their Preferred Approach To Investing
Understanding their approach to investing. There are several ways to invest in real estate. Which lane are you comfortable in? What are your goals? – Bobby Bryant, Ask DOSS
Every great investor must realize we are all full of our own biases. Therefore, we must instill appropriate processes to question all of our own assumptions prior to moving forward into any investment. Your protocols must not only measure the necessary external economics, but they must also account for the internal factors we all have. The prudence of a successful investor must take place ahead of “game time.” Prudence is premeditated, calculated and stewarded before you ever step on the field. With this practice in place, you can always move with speed and excellence at game time, which is also an absolute necessity. – Zach Morrow, Boron Capital
Have the patience to allow adequate time for due diligence, ensuring neither yourself nor your clients will jump the gun. Materialize all information required prior to making a decision, assuming time is not the biggest factor. As Elon Musk said, “Patience is a virtue, and I’m learning patience. It’s a tough lesson.” – Broby Leeds, Slifer Smith & Frampton