strategy Archives - RE Mentor Blog

With any type of investment or business, research is important. This will allow you to know what to expect and also have the ability to be able to distinguish a diamond in the rough by examining comparables.

Before you write an offer for any market, you're going to want to spend some time getting a feel for the market.

Doing this before you look at deals will allow you to move much more quickly when recognizing a potentially good deal as much of your due diligence has already been done. How can you know what a good deal is without research?

You will have little background on which to judge investment deals. Your market research can and should include most of the following information:

what rent is going for an area, who the large employers are, and what the smaller sub-markets are doing. What are home sales like in the area?

Where is job growth going to come from and what kind of jobs will these be? Where will new transportation be? What is the current rental market like? Asking all of these questions gives you an idea of the bigger picture and explains the economics of the area. Knowing the current situation along with where future trends lie will allow you to assess a deal for current viability along with future appreciation based upon the trends that you have researched.

Secondly, look at some comparables with in the area.

Taking time to study these will let you understand what the market is truly like. This will allow you to know prices within an area (as well as submarkets) and roughly what you can expect to pay if paying market price. This can help you quickly determine if a prospective deal is brought to you whether it is undervalued and whether you might be able to create forced appreciation very quickly.

Look at as many comparables as possible and most experts recommend around the last fifty.

This can allow you to see what has happened over a period of time and lessens the impact that outliers can have upon the data due to the larger data pool you are using.

Remember that you do not have to find all this information yourself. Use the services of an experienced broker. They are paid very well to help you succeed. You must make the broker feel comfortable knowing that you will work for him as much as he will work for you. The importance of using a broker is that here she is in this particular market every day. He or she should know what the hot areas are and should be able to bring you some potentially good deals. You are paying for the brokers’ expertise to do not be afraid to ask questions as you do your market research.

Hopefully this article on the importance of doing a research is giving an indication of what you have to look for in the reasons to do it. Completing the due diligence can make you a great deal more money as you're able to jump on an opportunity that much quicker and put your bid in with the confidence that you have done the market research to make this potential deal work out for you.

Business systems are the way you do things. They are the procedures that can be replicated.

For example, we recently created a telephone answering system for an office receptionist. We created a script that delineated how she is to answer the phone and what information she needs to collect. She has responses for the types of questions callers may have and to whom she should direct calls.

We were very specific about the circumstances for transferring telephone calls and circumstances for taking messages. In addition, we established the procedure for inputting the information in the business’s customer relationship management (CRM) database program.

Effective business systems can be created for all kinds of work performance that occur in your organization. As you formalize your systems, the time you spend focusing on the details of a job become invaluable; as you critically examine each step of a process, you are also determining whether certain areas need improvement. This is a key component of the process because business systems need to be reviewed and improved as the ways of doing business change.

Here are five other reasons that effective business systems provide value:

1. Systems provide consistency

With business systems, you can produce the same products and services with the same level of consistency. Once you have created your systems and written down the sequential steps, your employees can follow the proper procedures consistently. You can monitor these processes and improve when necessary.

Systems can be implemented for sales, marketing operations, employee training, etc. The people who benefit the most from having systems in place are your customers who know what to expect from your business.

2. Change is easier to accomplish

Systems make a business predictable. So when change impacts your business–which may often occur–then knowing what business systems need to be modified becomes easier. You will know the current work process and can predict how change should be handled while still maintaining your systems.

Once your systems become part of a flow chart, or are written as a set of sequential tasks and procedures to follow, they become easier to monitor. You’ll notice that tasks will be completed properly and efficiently; changes can be more quickly addressed.

3. Training new employees becomes easier

New hires can be quickly integrated into your business when there is a written set of procedures for them to follow and they know exactly what is expected from them. It becomes easier to gauge the effectiveness of an employee when you have a measurable set of guidelines to review.

4. Business systems allow staff to focus on what they do best

Any time you are trying to complete a project with a specific deadline, you will want to avoid any problems that may develop. We like to create business systems that also best match the employee talent that is available. Allowing people with specific skills, knowledge, and abilities to be responsible for those parts of the business allows for better quality of work; everyone then can focus on what they do best.

Once business systems are established and implemented, activities can be performed on “autopilot.” Repetitive activities in your business become routine, and you can focus on activities with higher payoffs.

5. Business systems create value

Effective business systems become a part of your company’s organizational infrastructure. If you are selling your business, formal procedures add value. Buyer can see that operations run smoothly and consistently; new hires can be quickly integrated.

Systems are what make businesses grow, flow, endure, and sell. This makes a business purchase more enticing and more valuable because the systems become tangible assets. Businesses that effectively follow systems find themselves winning against their competition.

Are you looking to implement systems into your real estate business? Learn more about how our dedicated RE Team mastered this process and can pass on the mechanics of success.

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Research “Comparables” Before Buying Real Estate In That Market