Want to find other investors in your area? Maybe you are looking for cash buyers, motivated sellers, fixers, flippers, and lenders? Where do you turn? Look no further than your local real estate investment group. You’ll find nearly every kind of real estate investor imaginable (or connections to them) to help you build your team, find profitable investment properties, and avoid rookie pitfalls in real estate investing.
You don’t have to be in a huge metro area. Even small towns have real estate investment groups. Wherever people live and work, there are investment opportunities in real estate. Sure, some markets appreciate better than others, but as long as you aren’t in a town where jobs are scarce and businesses are shutting down and shipping out, you can find opportunities. If there are some signs of economic growth in your town, heed advice from seasoned investors in the area. Remember, every large city was once a small town and I’m sure you could find plenty of examples of booming real estate markets, such as Scottsdale, AZ, that were small and lacked excitement long ago.
Smaller up and coming cities without huge bandwagons of investors shouldn’t turn you off. Just because a market is quiet doesn’t mean there aren’t opportunities. Likewise, if a market is hot, do your research to make sure it’s warranted. As Warren Buffet says, “Be fearful when others are greedy and greedy when others are fearful.” It’s sound and timeless advice. What if you were greedy in 2009-2010 when everyone was freaking out about plummeting housing prices? You’d be in pretty good shape now, especially in regards to our Scottsdale example.
Interview with Liz Nichols, an Iowa RE Investing Group Organizer
In order to get better insight into real estate investing groups, our CEO Jeri Frank sits down with Liz Nichols. Liz, who you’ve seen in previous posts on hard money lending, is also the leader of the Iowa City Area Real Estate Investing Group in the Eastern Iowa corridor. Although AssetRover is a real estate technology company with a national focus, we are based out of Cedar Rapids, IA and we attend this meetup. This group embodies the positive principles that we mention in this article. The group alternates locations between Cedar Rapids and Iowa City/Coralville every month.
In the early 2000s, there was a REIA group in Cedar Rapids. Liz was active in the group, but with the real estate crash, the group suffered. When Liz decided to get back into real estate again, she noticed there was no similar real estate group in Iowa City and started one there. This group attracted members from Cedar Rapids as well, and grew to serve the Cedar Rapids/Iowa City corridor area. This small group with only a few initial members has grown to include over 180 real estate investors in the Eastern Iowa area.
“It’s important I think for local investors to meet locally,” said Liz. “There are several good reasons for this. One, it’s usually a very inexpensive, and even free often, meeting place for individuals who are interested in real estate. Aside from that, often you have to go find a national group, and that will be expensive for travel as well as for fees that are often charged at the national level.”
“We try to find a public meeting space, a public library in one of the communities that we’re serving. If not, every once in a while we’ll meet at a local restaurant or local bar,” said Liz.
How Does a Real Estate Investment Group Benefit You?
There are many great reasons to get in touch with your local real estate investment group:
- Members can help you decide if a local market is hot or not.
- If times are tough, the members will be by your side watching the market with you and finding early opportunities to strike.
- Connect with cash buyers for your fix and flip projects.
- Find money from private money lenders who can help you when the banks won’t.
- Learn about real estate calculations and what market rents and property values typically are in the area.
Many topics are covered in these investor group meetings. “We have to cycle around to Real Estate 101 every once in a while because we do have new people coming in all the time. Sometimes we’ll have a meet and greet where we’ll informally have a group of people who are experienced and a group of new investors, and it gives the new investors an opportunity in a smaller setting to ask their questions,” said Liz. “We have property management sometimes as a topic…really, everything from investing in tax liens and foreclosure property, wholesaling, everything from that to landlording. We really try to cover a broad range, particularly with residential real estate.”
Not All Real Estate Investment Groups Require Money
If you think a real estate investment group is like an “angel investor club”, think again. This isn’t like your typical investor club where people throw money in a pot and find an investment to pool together and purchase. If this is what you are looking for, you could certainly find others willing to do deals like this, but that is not the only intent of the group I’m talking about. A proper real estate investment group is all about networking via learning, mentoring and using strength in numbers to your advantage.
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Strength in Numbers
Having a list of interested real estate investors is huge when you want to flip, wholesale, get rid of a property, or pick up a good buy and hold. A local real estate investment group will “be your most reliable group of buyers,” says Liz. “If you’re a wholesaler, for example, you can e-mail people in the investment group, a hundred and eighty members in the Eastern Iowa corridor, and they’re interested in real estate. They want to buy real estate. That is your ready-made buyers list. Why not join a local group? Particularly if you’re wholesaling, that’s a way of finding your buyers. If you’re looking for property, people all the time are selling property, so you can find not only buyers, but you can find properties as well.”
As Always, Watch for the Scammers
A good real estate investment group should not be “elitist”. Don’t just join any investment group. Look at the group’s reputation, goals, and willingness to help. Some groups bring in “gurus” every month to give you a sales pitch and try to get you to buy their product. Understand the difference between education and running scams to get people’s money. It’s okay for a speaker to promote their own products–that’s the perk they get from taking time to prepare a lesson or speech for your group and they deserve some publicity. The problem is when the speaker tries to manipulate you into putting money towards an investment or service without allowing you to use your best judgement.
Even an Experienced Investor Could Learn Something from a Group
Just because you are a seasoned investor, you shouldn’t believe that a real estate investment group s useless or that you are too advanced or “too good” for one. Mentorship is very rewarding and you were also a beginner once! If you think you are already an expert and don’t need other people or mentors to help you, stop, come back to reality, and never forget that there are always opportunities to learn from others. Even a newbie could give you a fresh perspective. Besides, you remember only a fraction of what you learn, but you remember 100% of what you teach. Refine and refresh your own skills by teaching others. This keeps you from getting rusty on the fundamentals.
Find a Group Near You
Hopefully you have a new appreciation for real estate investor groups and want to find one in your area. Here are a few good resources:
Meetup.com – Don’t overlook the local unaffiliated groups out there. Smaller cities may not have official REIAs. Despite their smaller stature, plenty of people attend. These people are avid real estate investors or people who want to learn. The seasoned investors have a wealth of experience and knowledge that you can benefit from!
During the interview, Liz mentioned a few books that inspired her as an investor. If you would like to get more information on these books or purchase them, please follow the links below:
Rich Dad Poor Dad
Anyone stuck in the rat-race of living paycheck to paycheck, enslaved by the house mortgage and bills, will appreciate this breath of fresh air. Robert Kiyosak’s book Rich Dad Poor Dad will give you insight into the methods that have created more than a few millionaires. As proven by the runaway success of The Secret and like titles, changing one’s thinking to influence one’s fortune sells big, and forms the basis of Rich Dad’s advice. Learn to think like a Rich Dad and let your money work for you!
Think and Grow Rich
Think and Grow Rich by Napoleon Hill is a bestseller and one for all ages, a modern day classic filled with ideas which have the power to change your life and set you upon the path of learning and self development. This book conveys the experience of more than 500 men of great wealth, who began at scratch, with nothing to give in return for riches except thoughts, ideas, and organized plans. Here you have the entire philosophy of moneymaking, just as it was organized from the actual achievements of the most successful men known to the American people during the past fifty years. It describes what to do and how to do it! It presents complete instructions on how to sell your personal services. It provides you with a perfect system of self-analysis that will readily disclose what has been standing between you and “the big money” in the past.
With more than a million copies in print, Robert G. Allen’s Nothing Down for the ’90s has probably helped more people achieve success in real estate than any book in history. Countless numbers of his readers are now financially independent and many actual millionaires attribute their wealth to his techniques. Why has this blockbuster bestseller been so successful? The answer is simple: it works! Now, in one of the most practical books you’ll ever read, Robert Allen has created effective new wealth strategies for investing in real estate.
For more information on the Iowa City Area Real Estate Investor Meetup, visit the official meetup site at meetup.com/iowa-city-area-real-estate-investor-meetup. You may also email Liz Nichols at firstname.lastname@example.org, call her at (319) 359-0656.
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[00:01] Jeri: The first thing we’re going to start off with is talking about the value of a real estate investor club, often called a REIA or Real Estate Investor Association. Tell us, what is the advantage of having one of those and attending?
[00:15] Liz: It’s important I think for local investors to meet locally. There are several good reasons for this. One, it’s usually a very inexpensive, and even free often, meeting place for individuals who are interested in real estate. Aside from that, often you have to go find a national group, and that will be expensive for travel as well as for fees that are often charged at the national level. A recent road show that came through trying to recruit investors to a national group were charging forty thousand dollars for their services and to be educated on real estate. Compare that to what is fifteen dollars annually to join a local real estate meetup, where you have other investors who are also interested in real estate, have various levels of experience. You can ask questions, you can get answers. You can network in terms of finding mentors or joint venture partners, even private moneylenders. You can find those locally. You don’t necessarily have to spend a lot of money and get that education and that experience with finding partners nationally. It will also be your most reliable group of buyers. If you’re a wholesaler, for example, you can e-mail people in the investment group, a hundred and eighty members in the eastern Iowa corridor, and they’re interested in real estate. They want to buy real estate. That is your ready-made buyers list. Why not join a local group? Particularly if you’re wholesaling, that’s a way of finding your buyers. If you’re looking for property, people all the time are selling property, so you can find not only buyers, but you can find properties as well.
[02:29] Jeri: I definitely understand what you were saying about what you can learn from the mentorship that’s available at these investment club meetings. My own experience has been that as you go and as you’re learning about real estate investing, there’s so many nuances to every aspect of real estate investing, and it’s great to have the opportunity to have a one-on-one conversation and ask your question, and the nuance you have. Because you can read everywhere on the web about how to do this, but then there’s always that little nuance that you’d like just a little more information on, and it’s good to have that one-on-one feedback.
[03:07] Liz: Each market is a little bit different. Some markets are great for rental properties. Others have a lot of foreclosures and maybe are great for wholesaling. Other investors will help to hook you up with the information you need right away so that you’re not left trying to figure out not only what you like doing in real estate, what you’re best at, but also what your market is going to provide you.
[03:39] Jeri: Tell me more about the Iowa City real estate meetup that you’ve pulled together. How did that come about?
[03:46] Liz: In the early 2000s, there was a REIA group in Cedar Rapids. I was pretty active in that, but then, with the real estate crash, really I think that group kind of fell apart. There is also a Landlords of Cedar Rapids group. Right about the same time I decided I wanted to get involved again in real estate. There was nothing like it in Iowa City, so I decided I’d start with the Iowa City area, and to my surprise about half the group or more started coming from Cedar Rapids, so we’ve become more of a corridor group. They are generally the third Wednesday of the month, and we meet usually at 7:00pm. We try to find a public meeting space, a public library in one of the communities that we’re serving. If not, every once in a while we’ll meet at a local restaurant or local bar.
[04:57] Jeri: What kind of things do you cover in these club meetings?
[04:59] Liz: We have to cycle around to real estate 101 every once in a while because we do have new people coming in all the time. Sometimes we’ll have kind of a meet and greet where we’ll informally have a group of people who are experienced and a group of new investors, and it gives the new investors an opportunity in a smaller setting to ask their questions. That’s been a very successful kind of approach. We have property management sometimes as a topic…really, everything from investing in tax liens and foreclosure property, wholesaling, everything from that to landlording. We really try to cover a broad range, particularly with residential real estate. Every once in a while we’ll come up with a commercial property topic, but mostly it’s with the residential.
[06:05] Jeri: You’re open to topics that club members have.
[06:07] Liz: Yes. We generally will ask club members. Probably half our meetings are set up based upon what club members tell me they want to talk about or people that they may have an expert in an area.
[06:23] Jeri: How has the club changed over time?
[06:27] Liz: It’s grown exponentially. We started out with about three people on average the first year. Then it became seven to twelve. Then it became twenty to twenty-five. It’s remained about twenty to twenty-five most meetings, but the numbers of people who are at least getting to the meetup site and joining that way has grown. I think last year was maybe a hundred and twenty-five, now it’s a hundred and eighty.
[06:57] Jeri: Very good. What kind of books have inspired you as an investor and why?
[07:03] Liz: Most people start out with Rich Dad Poor Dad, some maybe back with some of the old classics like Napoleon Hill, Think and Grow Rich. I didn’t really start there. I started actually with Robert Allen, who was very popular in the 1990s and the early 2000s. His main claim to fame were the series of books No Money Down, real estate investing with no money down. He really did convince me that there were ways to invest without a lot of money out of pocket, and I’ve been encouraged with that. That’s really how I started, was with Robert Allen and his program. We did do some investing locally first, bought our first rental property, before I started with that program. Then I did exactly what I tell people not to do, and that is go to a big national program and start there. I’m one of those people who within the first year of starting to invest did go through a twenty-five thousand dollar program. They’ve actually gotten more expensive, some of the bigger ones, bigger names. I actually advise people not to do that, to start small, start locally, start by buddying up with other local investors and then go from there. Then, if you want to invest nationally or on some specialized kind of topic, then go ahead and get some national training.
[08:57] Jeri: Do you have other things that you would suggest to a new investor as they’re looking?
[09:02] Liz: Get to know yourself and what you are comfortable doing. A lot of people start out getting a rental property and then discover that they absolutely hate tenants and toilets, and yet the property cash flow isn’t enough so that they can go hire a property manager and actually make it cash flow, so they’re stuck with tenants and toilets. Other people decide that they want the quick cash. They don’t want to get wealthy on the slow route, they want to try to do it fast. There’s probably no real way of doing it fast, but if you’re more interested in cash or need cash first, then you need to start with wholesaling. You need to think through your strategy and build your network, your team, which includes an attorney, your other investors who might partner with you, a realtor, and other people who would be important locally in being able to support your real estate business.
[10:20] Jeri: I think that’s all really great advice. If you are someone who’s interested in joining, how do you go about that?
[10:28] Liz: You go to our meetup site. Search for “Iowa City real estate investing,” or even “Cedar Rapids real estate investing,” and you’ll get the closest meetup groups that are into the real estate investing area, and then you can sign up at that site.
[10:49] Jeri: What is the fee per year?
[10:51] Liz: We’ve just raised it from all of twelve dollars to fifteen dollars a year. That supports the meetup site. They’re charging a little over a hundred and sixty dollars a year just to support the meetup site, but it also helps with offsetting handouts and sometimes refreshments that we bring in.
[11:22] Jeri: Thank you, Liz. Appreciate it.
[11:24] Liz: Sure.