What is a Real Estate Consultant
Real estate consultants are experts hired to study how well a property might meet the requirements of an investor. Their detailed knowledge of the industry allows them to offer top-notch advice to those looking for new properties to invest in. Consultants will advise clients on opportunities in a specific real estate market.
Read on to learn more about the role of a real estate consultant, what types of consulting they may advise on, the difference between a consultant and an agent, and the benefits and drawbacks of using a real estate consultant before you invest.
What Do Real Estate Consultants Do?
A real estate property consultant is a professional who advises real estate buyers and sellers to help them make informed decisions about the properties they buy and sell. They can help you by creating a financial analysis on any given property. Or, they can help with strategic planning in the construction of your portfolio. In transactions, their role is about asset management.
A real estate investment consultant will usually work with investors as opposed to working with the buyers and sellers of residential property.
Types of Real Estate Consulting
A property investment consulting professional can provide several services. The types of real estate consultants can be categorized by which of these services they tend to focus on or specialize in. While most real estate consultants will work with a variety of clients, some will specialize in either property development or real estate investment. Either way, consultants will conduct extensive research and develop the expertise needed to advise the type of clients they choose to focus on.
Property Development & Real Estate Investing Consultants
Property investment consultants specialize in property development. They’re often called in to advise on development projects and oversee them from beginning to end. Their work may involve searching for sites that are optimal for the project and the needs of the principals.
They also may run competitive analyses and conduct feasibility reports. Property development consultants generally have a marketing background while investing consultants tend to have an education based in finance and investing.
Real estate investment consultancy firms offer a broad spectrum of services. Their job is to ascertain the value of a given real estate investment or development project. Consulting services are offered to investors, real estate investment trusts, business owners, lenders and corporate property groups.
Consultants who work for a real estate consulting firm are expected to conduct marketing studies, offer portfolio and lease advice and perform due diligence on the projects they work on.
Real Estate Investors
Real estate investors who want to add a property to their portfolios will often hire an investment property consultant to help them negotiate the investment process. In so doing, the consultant will complete an economic analysis in order to show that an investment is worthwhile for the investor. This could begin by taking a look at the price of the property, location and supply and demand, among other factors.
Real Estate Consultant vs Real Estate Agent
Real estate consultants are often compared to real estate agents, but there are important differences between these two types of professionals.
A real estate agent is hired to handle the process of buying or selling a piece of property. Unlike the role of a real estate consultant, agents are not responsible for the quality of the sale or purchase as an investment.
Real estate agents, as opposed to consultants, are not there to ensure clients can make money or improve their investment portfolios. They also don’t look at potential for any long-term financial gain that can be made on a property. They are only there to negotiate and move money, see that all the right documents are signed and complete the transaction.
Benefits of Real Estate Consulting
For investors, the benefits of working with a real estate consultant are considerable. They include:
- Professional guidance
- Expert negotiation services
- Knowledge of local markets
- Expert appraisal services
- Detailed, client-specific planning and implementation
- Accountability (if the consultant makes a mistake, they may be held accountable)
Disadvantages of Real Estate Consulting
For investors who want to be certain that a given investment will be good for their portfolio, there are few true disadvantages of real estate consultancy. Especially for investors who don’t specialize in real estate, consulting services are virtually a must. Disadvantages can include:
- The added cost of owning a property
- Preliminaries can take longer when done by a third party
- Cost for services
Real estate consultants can be instrumental in helping you with your next real estate investment, especially if you’re a busy investor who doesn’t have the time to fully conduct due diligence on a piece of property.
Are you looking for new and exciting real estate investment opportunities? Connect Invest can help your real estate investment strategy align with your future financial goals. Sign up today to learn more.