Real Estate Investing Business Plan
A real estate investing business plan is a document (preferably electronic) that outlines and details the way in which you intend to run your real estate investing business. Included are your business goals plus the strategies and timelines you intend to implement to achieve those goals. This document should evolve as you gain experience, and grow and develop your business.
Creating this plan ensures you get clear on your goals and how you will proceed to achieve them. This plan is the roadmap for your business going forward. It’s a crucial part of getting your business off the ground.
When you get into the investing business, you need a real estate investment business plan to present to lenders or potential investor partners. A real estate investing business plan will save you from unnecessarily spending and wasting time because you will have a solid plan laid out as you start.
As part of her course and coaching, LeAnn Riley will guide you on developing a real estate investing business plan that will get you started on your real estate career or business.
Below are the elements of a well thought out real estate investment business plan.
Components of Your Real Estate Investment Business Plan
Executive Summary
This section is a summary of the contents of your business plan. It should allow your readers to quickly review and understand what your business is, who you are, and what the goals for your company are.
You may decide to customize this section to fit the reader and your intended goals for that specific audience. This might be a bank or someone you are looking to partner with for funding a real estate investment portfolio.
Structure of Your Organization
This section provides a brief history of the company, the members and roles of your team, the legal structure of the company (partnership, LLC, etc.), vision/mission statement, etc.
Analysis of Strengths & Weaknesses
Here, you will outline how your company stands compared to others doing the same. Of course you will want to describe the attributes that will show where you stand out, but it’s important to also cover the areas you intend to shore up or work to improve. When it comes to attracting funding, a clear real estate investment business plan will make the difference to lenders/partners trusting you with their money. Many real estate investor applicants will not provide a clear investment plan, which helps you stand out in the eyes of lenders or potential partners.
Your Understanding of the Market
In this section, you will identify the geography and target market you plan to invest in and what your strategy will be. Maybe you plan to invest only in townhomes in the northwest corner of a specific metro area. Or, you intend to focus on multi-family units in smaller towns south of that metro market. Which city or other geography will you target and what are the demographics of that area. You’ll want to show how many rental units are in your target market and what comparison rental rates are in that area. In addition you need to find comparable properties to what you are intending to buy or rehab.
You will want to prove you have the knowledge and expertise to follow through with your plan.
“LeAnn Riley is a great real estate investment coach and mentor.
Her knowledge, experience, integrity, communication skills and Proven Profit Formula strategies have contributed and complemented greatly with my goals for real estate investing.
When I needed confidence, education and a plan for the future, LeAnn, you listened to my ambitions and fears.
I had no idea that one word would change my life–LEVERAGE. Understanding leverage allowed me to make my goals more than obtainable…they became doable!
Thanks, LeAnn, for getting me off the couch. Being an armchair investor is no longer good enough.”
– Russ
Financial Strategy
Here, you will outline the methods you plan to use to finance the growth of your real estate investment portfolio. Include an income statement, cash flow plan, net worth and any debts and liabilities. You’ll need to show your finances of the investments, what type of cash flow or return on investment you intend to look for. How will you operate the business and what will be your overhead expenses. You’ll need profit and loss statements and will need to show you have professionals on your team to guide you in creating this outcome. For example, you need an investment accountant, Realtor who understand investment property, title company, lenders, contractors, etc.
Growth Plan
This section will outline how you plan to grow your business. If you’re just starting out, this might be difficult. But it shows your readers (potential partners or lenders) that you are planning for a successful future for your business. This planning process also helps you stay on course to keep moving ahead. Which real estate investment strategy are you planning for your first acquisition? Is it fix and flip or buy and hold investing? Explain how you will be making money and growing the business, show in charts and graphs what are the projections.
Exit Strategy
Depending on your chosen investment strategy, your exit strategy may be different. LeAnn Riley and her Proven Profit Formula community will help you think this through so you can outline a plan depending on the strategy. In real estate investing you will often hear the saying, “You make your money on the buy”. That can be true but LeAnn believes that optimization of a property can occur quite easily IF you know how to be creative and understand ALL THE METHODS of making money in real estate investments. You see, the business of real estate is a problem solving business. The more you are decisive and educated in the process the quicker your reaction. This can be the difference between making money or not.
Thoughts and Ideas to Help You Create a
Practical Real Estate Investing Business Plan…
LeAnn Riley’s course–the Proven Profit Formula Coaching Program–will provide you with the necessary tools and skills to ensure you don’t invest blindly in real estate.
Our course helps you from the beginning by ensuring you lay out your expected goals and the strategies that will help you achieve them. For a real estate investing business to be successful, you need to follow through with the plan, be disciplined and consistent. Your goal is to invest and realize positive cash flow that will give you financial freedom and make money without the hassle of a nine to five job.
Determine Your Goal & Do Research
When investing your time to create a real estate investment business plan, there are specific goals you want to include. LeAnn Riley’s course will provide you with information that can help you incorporate your goals and intended strategies into the business plan, including all the financials, and if needed find investors to raise capital, provide financial assistance or to partner with.
Investors and lenders need a well-explained real estate investing business strategy before they can help you in achieving your goals. Things may not go according to plan, but you have to stay focused and keep going no matter how tough it gets. So fall back to your plan, remind yourself what you want, and figure out how to get back on track. Being resilient will help you get to your goals and build a successful business.
There are always risks in investments. The way you can get around it is by being prepared for any outcome. When preparing a real estate investing business plan, we help you analyze the strengths, weaknesses, opportunities, and threats of this type of investment. We help you research and understand the market, know your competitors, and ways you can be a step ahead of them. A real estate investing business plan helps you plan so that you are ready to handle any risks and threats that may occur. Our Proven Profit Formula Coaching course helps you to understand all that may affect your business the minute it starts. Being ready to deal with issues as they arise is one way to make your business survive the harsh and challenging times and the market ups and downs. You want to know you can actually prosper even in a falling market, if you know how.
Determine Where Funding Will Come From
The real estate investment business plan sample is extensive, and to start, you need capital. You may have some saved up, but there are many ways you can get funding for your business. For this to happen, you need a real estate investment business plan to convince investors why they should put their money in your business, or lenders to determine how much and what type of loan is appropriate for your plans. As a client of the Proven Profit Formula Coaching Program, LeAnn can help you make a real estate business plan that will work for you and help you get investors or loans to raise your required capital as quickly as possible. Again, you may have leverage that you never even considered.
Networking
To succeed in any profession, you will want to get to know a variety of people in the real estate investing industry to share and exchange ideas. Using LeAnn Riley’s course, you get to know how your market works and how others involved in real estate play a significant role in the success of your business. As you continuously network with other professionals, you learn and grow as you go.
LeAnn’s Proven Profit Formula Coaching community brings you together with others who are going through similar situations to yours. Gathering in person or virtually with others allows you to brainstorm and problem-solve together. It’s also about accountability–requiring you to keep your word and report actions toward your goals is proven to increase your chances of success.
In conclusion, to make it in the real estate industry, you need to have a well-thought-out business plan. A real estate investing business plan helps you get funding for your start-up business and for ongoing growth. An investing plan will act as a road map for you on how to achieve your goals. It will ensure you avoid mistakes and unnecessary spending because you will have a plan and budget to follow to get the desired result.