Digital Real Estate – How to run the business when you cannot meet in person
Digital real estate. In other words, virtual real estate.. The recent pandemic has been a call for all businesses to rethink how they conduct business and real estate is no exception.
The way I see it, this will be a game changer in the real estate world: digital real estate (or virtual real estate) will be the usual way of conducting business.
I have been engaged in virtual real estate investing since the ‘90s, when for personal reasons I used to live in 2 different cities 1,200 miles away from each other. Even with the limited technology and means available, I was able to conduct my business virtually long distance. Today that is how I run my business, even at a local level, all virtually.
First of all, it’s definitely a mind shift that you have to do as a real estate investor. You have to believe that you can run your real estate business – wholesaling, fix and flip or buy and hold – without being on location, showing properties, meeting buyers and sellers, closing at a title company’s office. All can be done virtually.
But what are the tools and the strategies that you need to be aware of in order to run a digital real estate investing business, without ever meeting in person?
Digital Real Estate
- Buying and Selling Properties – we buy and sell properties via photos and videos. We have the seller send us photos of the property or we use a local real estate agent to go to the property and take a lot of photos and videos (we compensate the agent of course.) There are also companies like WeGoLook, that you can hire to go to the property and take photos and videos for you.
- Lockboxes for Access – if the property is vacant, you can grant access to the property via a digital lockbox, that you can control from your phone. VaultLocks offer such solution. We also usually ask whoever enters the property and we give access to, to send up a photo of their Driver’s License, holding it next to their face so we can match the picture.
- Tenants, Neighbor or Homeowner – if the property is occupied by a tenant, you can have the tenant show the property and we compensate the tenant at closing for their time and doing a good job in showing the property (that is an incentive so they don’t say anything negative about the property or the owner.)
If the homeowner lives in the property, we tend to still get a 3rd party involved, like a real estate agent, to show the property. It’s never a good idea having the owner speak to the potential buyer.
A neighbor can also be very helpful in showing a vacant property where the owner is reluctant in just having a lockbox installed and also the neighbor can keep an eye on the property (of course, we do compensate at closing as well.)
- Closings – most title companies and closing attorneys are set up to run virtual closings: they will email you the closing documents, which you can sign, scan back and send the originals back overnight. Moneys are disbursed via wire.
They also have mobile closings, where they send someone to you to close, even if you live in another city (they have local affiliations with other title companies.)
There are also transactions coordinators, like Transaction Management Consultants, who can set up all the transaction and the different moving parts to close virtually.
How do you shift from the “regular” way of conducting your real estate business to a digital real estate model?
Write down all the steps that you need from beginning to end. From locating properties, to marketing, due diligence, closing, etc.
Think, “How can I perform this task with minimum or without personal involvement?” Find which tools, assistants and systems you can implement in order to reach that end in mind.
Test the process in one location and then you can exponentially grow across markets.
As you can see, shifting the way you do business and letting go of micro-managing every transaction, is not only possible but effective. It will make you much more efficient as a real estate investor, and exponentially grow your investing business, without taking any more of your time or effort.
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