Finding private real estate investors for real estate deals is crucial if you want to grow a sustainable portfolio over the long term.
Real Estate is a tried and true asset class as far as wealth building goes. It’s also one of the most capital intensive, requiring large amounts of cash, especially if its commercial real estate.
Banks will typically grant loans of up to 60% or even 80% in some cases, leaving around 20% to 40% of cash equity to be injected into the deal.
After spending 13 years in funding commercial real estate deals within the corporate real estate finance divisions of major banks, I found that the biggest stumbling block for many aspiring property investors and developers has always been this 20% to 40% equity piece.
In many cases, even the largest real estate players don’t always use their own cash to provide this equity. They often rely on Private Investors
But how do you go about finding private investors for real estate deals?
There are some “old school” ways to go about this and they all work.
This includes family, friends, work colleagues and good ol’ fashioned Networking (offline)
These have all been known to work, but I’ve found that unless you’re able to tap into a really wealthy pool of people, you eventually run out of capital and that’s when your real estate dreams can come crashing down.
Why?
Well it’s simple. How many friends, family and work colleagues does the average person really have? And how much capital do they usually have access to?
The answer is….very little
Plus all of them will not be interested in investing in real estate.
Which means you’ll run out of capital really fast.
So what I would like to touch on in this post is how to tap into an almost unlimited pool of private investors who actually WANT TO INVEST
Where do you find these people…..the answer is ONLINE
Why Finding Private Investors For Real Estate Online Is The Best Way
The internet and the growth of social media over the last 15 years has made it much easier to reach millions of people.
People have built fortunes from marketing their services and products online.
But not many real estate investors have taken advantage of this massive opportunity.
The most well known online influencer who has made millions of dollars in real estate because of his social media presence is none other than Grant Cardone.
Through his company Cardone Capital he has been able to raise close to $1bn to grow his portfolio and this was done primarily through social media platforms
The message is clear.
While real estate might be an old school asset, it requires new school thinking to make it work in this new digital age, if you don’t have access to your own capital.
3 Step Process To Finding Private Investors For Real Estate Online
So how does Grant Cardone do it?
In essence he is following a simple 3 Step process.
- He BUILDS his audience daily by creating content
- He ENGAGES his audience which allows them to trust him
- He SELLS them his real estate opportunities
STEP 1: BUILD An Audience
Most people will prefer if I said that all you have to do is ask people for money online and they’ll send you the money. But it is never that easy
Remember that for anyone to give you money, especially online, they will have to know you and trust you.
Or they must “FEEL LIKE THEY KNOW YOU”
And how you do this is by establishing your personal brand online. It’s fine if you have a company name but people do business with people, not companies
So once you’ve decided to become a real estate investor or developer, take people on your journey as you find, assess and close deals. Give them a “behind the scenes” view of what you’re up to (without breaking confidentiality where needed).
This means creating content and posting regularly, with a focus on video based content.
I know, i know. Many people are cringing at the thought of putting themselves out there on camera while reading this. But my question to you is. How badly do you want to or need to succeed at building your real estate portfolio?
If the answer is that you need to make this happen, then follow one of the most important success principles ever taught………
Find someone who has what you desire and do exactly what they did.
And Grant Cardone is a great example of a success example in the real estate investment industry, especially where using social media is concerned.
If you are wondering whether this works. Ive been creating regular content for years and not too long ago I had a lady reach out to me who I had never spoken to before, telling me she has $150,000 and she would like to invest in real estate.
This was a complete stranger reaching out to me and trusting me enough to tell me she needs help investing her funds .
So building your audience through regular content creation WORKS
STEP 2: ENGAGE Your Audience
As your name and brand becomes more known in the marketplace, the next step is to really connect with your audience.
And you do this by engaging with them. This means replying to comments, answering questions and just being a genuine person that wants to help them
At this point it is important to note that not everyone will invest money with you. Some people might want to do this on their own and just learn some strategies from you. Let them
Real estate is a team sport and what you’ll find is that some of your audience members will actually begin bringing deals to your doorstep. So you will be winning in two ways……
- You’ll be building an audience of people who may invest with you in the future
- You’ll build a never ending deal pipeline
So take the time to engage with your audience.
STEP 3: SELL To your Audience
The last step is what you’ve been waiting for. But depending on how well you did steps 1 and 2, it could take a while to get to this last step so be patient and consistent.
As your audience begins to trust you a bit more, you can OCCASSIONALLY let them know you’ve closed a real estate deal and here’s the key…..
Let them know they can APPLY to participate in your deals. This creates a sense of scarcity which drives up the desire to BUY
Ever walk into a shoe store and walked out with an expensive pair of shoes because the sales person told you it’s the last pair?
Limiting the amount of people who can work with you, will cause people to line up and be willing to pay any price to participate in your deals.
This is not just a marketing tactic however. Genuinely scan through applicants because in the end you really do only want to work with people who have the means, don’t need their capital back in a short time frame and overall are really quality private investors.
This will make your life easier as well.
Just a note of caution. In most countries you require a financial license to take money from the general public, so do your research and make sure you are not breaking any rules or regulations. If you need a license…..get one!
CONCLUSION: Finding Private Investors For Real Estate Deals
Because so many real estate investors operate behind the scenes and don’t make use of the internet and social media to grow their portfolios, you have a unique and lucrative opportunity to help tons of people build real financial freedom through real estate investing and make big profits in the process for yourself
Finding private investors for real estate deals has never been easier than it is right now. And with the continued growth of social media and the evolution of the internet as a whole, you have the ability to create tremendous success.
The key however is being willing to step outside your comfort zone and building a brand online that people can trust
Take the step. It will be worth it in the long run
Sincerely
Aslam
