The Importance of Real Estate Portfolio Management

• Why Your Real Estate Portfolio Needs a Professional Manager
• What is Real Estate Portfolio Management?
• Diversification: The Key to Real Estate Portfolio Management
• Real Estate Portfolio Managers Help Maximize Real Estate Equity
• Real Estate Portfolio Managers Leverage Experience and Connections
• Real Estate Portfolio Managers Maximize Your Most Valuable Asset: Time
• Real Estate Portfolio Managers: The Bottom Line

Why Your Real Estate Portfolio Needs a Professional Manager

Owning real estate is often seen as a great way to save for the future. You might start by buying a single house or a duplex, qualify a tenant, and collect rent. This is great for someone just starting, but what happens as you acquire more properties? By the time you’ve purchased your third or fourth property, your workload can become overwhelming.

As you progress from owning one unit to owning multiple units, maintaining the assets in your growing portfolio becomes more difficult to manage. This is why you need an experienced real estate portfolio manager.

Once you’ve acquired multiple properties and are responsible for rents, repairs, taxes, and everything else, you might hire a property manager. This is a great idea. But even with a property manager to handle the day to day operations, you still need to consider ways to maximize the profitability of your real estate investments.

This is where real estate portfolio management comes in. An experienced real estate portfolio manager helps you maximize the value of the properties you own and ensures the long term value of you assets are aligned with your financial goals.

What is Real Estate Portfolio Management?

Most people know what a property manager does. They run the day to day operations of your property: collecting rents, calling the plumber when a sink breaks, things like that.

Real estate portfolio management has a much broader focus. It’s the high-level strategy of looking at all your properties as a single portfolio and developing a plan to make sure the properties are as profitable as possible while maintaining as low a risk as possible.

A real estate portfolio manager doesn’t just look at a set of building; they look at your life goals: “Are you trying to save for your kids to go to college?” “Do you want to retire in ten years?” A good real estate portfolio manager will look at the economic conditions of the marketplace and make sure your properties are maximized to ensure your long-term goals can be reached.

Diversification: The Key to Real Estate Portfolio Management

One of the important tasks of a real estate portfolio manager is to help you diversify your portfolio.

Imagine if you owned five houses In the same town and a large local business nearby closed down. All at once, many of your tenants lose their jobs. In this scenario, all five of your houses would experience extreme hardship at the same time. That’s a huge risk. A real estate portfolio manager would suggest ways to diversify your real estate holdings. They might suggest:

• Housing
• Warehouses
• Commercial Properties

By diversifying your real estate investments, your real estate portfolio manager makes sure that if one property or group of properties in your portfolio experiences a down turn due to economic forces beyond your control, the other properties can remain profitable.

Real Estate Portfolio Managers Help Maximize Real Estate Equity

In real estate, some properties have a higher rate of return than other properties. This can be due to a wide variety of factors some of which may not have been considered when you were acquiring the properties in your portfolio.

Some individual investors might choose to keep a lower performing property because they are emotionally attached to it or they are simply just accustomed to owning it. A real estate portfolio manager, on the other hand, will use current data, future projections, and other relevant informaion to determine when a property is underperforming. They will make recommendations to you that will lead to a greater return on your investment. They will handle the difficult operations of your real estate portfolio. These adjustments to maximize your portfolio help turn small real estate investments into large income producing real estate portfolios.

Real Estate Portfolio Managers Leverage Experience and Connections

When you hire a Real Estate Portfolio Manager, you gain the benefit of their experience and connections. Because they manage hundreds or even thousands of properties for many different clients, they have been able to gain experience and build connections in the field.

• Lower Costs: They can negotiate better prices with insurance companies and repair crews because they give them so much business.
• Early Access: They often hear about a building for sale before it ever hits websites or the MLS. So called off-market deals.
• Legal Protection: Real estate laws change all the time. A real estate portfolio manager makes sure you are following the rules so you don’t get hit with expensive fines.

Real Estate Portfolio Managers Maximize Your Most Valuable Asset: Time

A primary reason for hiring a real estate portfolio manager is time. Creating a profitable real estate portfolio is designed to give you freedom, but if you spend all your weekends looking at spreadsheets, dealing with taxes, and worrying about interest rates, you aren’t really free.

A real estate portfolio manager takes all these tasks off your plate. They provide you with clear reports every month that show exactly how your portfolio is doing. You get to be the owner of the properties, enjoying the benefits of your hard work, while the real estate portfolio manager handles the on going efforts in the field.

Real Estate Portfolio Managers: The Bottom Line

Real estate remains one of the best way for families to build generational wealth, but when it becomes very complicated and difficult to manage on your own, it’s time to bring in an expert. Hiring a real estate portfolio manager is like upgrading your computer. You’ll be able to be more productive and you can do so with a lot less time and effort.