3 Elements You Need to Become a Successful Real Estate Entrepreneur in the German Market Outpacing competitors in a highly competitive market is anything but easy. However, here is some advice how to stick out from the rest.
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With an estimated global value north of $200 trillion, the real estate sector is without a doubt one of the major pillars of today's economy. Particularly in Germany, property investors seem to be on an incredible shopping frenzy. According to the real estate consultancy Knight Frank, the prices for apartments, houses and offices in Berlin leaped by a whopping 20 percent in 2017. As PwC's "European Emerging Trends in Real Estate report 2019" summarizes, real estate remains highly liquid overall and German cities, once again, dominate the top 10 picks for 2019 despite continuing high values.
While investing in real estate is incrementally becoming popular in many western societies, the importance of outpacing competitors is unfolding as a challenging task. In the past 17 years, I have bought, improved and sold houses worth billions of euros right in the heart of Germany. Here's how you can do it too.
1. Don't wait for optimal conditions.
This may sound like the classic takeaway that every business guru is preaching day in, day out. Nevertheless, and especially in real estate, it's so fundamentally important. Frankly said, when I originally started in the industry, it seemed like there weren't perfect conditions either. At the beginning of the 2000s, for instance, the real estate market in Germany was nearly dead and the vacancy rate relatively high. However, after obtaining a decent overview of the current market, it was actually not that hard to sift out some quite promising opportunities.
Moreover, I truly believe that living and working by the "learning by doing" codex has greatly enhanced my chances of becoming successful. Studying theoretical situations by attending universities or reading dozens of books can certainly help to acquire some useful knowledge, but, in the end, it's the practical part that consistently builds a fruitful field for most entrepreneurs.
Starting as early as possible will almost always give you a significant edge over your competitors. Sure thing, getting the ball rolling involves the willingness to take risks and an awful lot of focus. Yet, by simply kick-starting your real estate journey you will inescapably acquire all the precious skills that are needed for a successful business in the market of lands and buildings.
2. Build up and maintain the right communication.
As soon as you start your own real estate adventure, you should keep an eye on your communication tools right away. Especially in Germany and in this specific industry, maintaining a good reputation is particularly vital. Would you buy or sell a property to someone who seems nebulous, or who is exposed to tons of negative reviews on the internet? Probably not.
To prevent this scenario, CEOs and founders should chiefly look at building up a personal brand. By becoming an authority in their niche or region, entrepreneurs may be rewarded with seriously increased trust and also publicity.
In order to create a personal brand, a decent part of your focus should definitely be centered around traditional public relations. You might want to start with securing appearances in local newspapers and then proceed with bigger, national and international publications. By leveraging the facts and figures of your business, this publicity can also be used to increase the brand value of your company.
Besides media coverage, there are several other communication channels that can help in gaining a substantial reputation and general awareness. For instance, I have successfully reached close to a 100,000 people by maintaining a personal Instagram account.
Those who have more resources available could also think about opening a YouTube channel, where high-quality video presentations can be displayed to prospective clients and partners. A young trend can be found in camera-equipped drones that are able to produce exceptional cinematic videos of your property at a very reasonable price.
3. Try lateral thinking.
While it might not seem like it at first, the real estate sector is actually in a constant shift. Regions that were a prime location for acquiring land a few months ago could be a fairly bad place to invest today and vice versa. Thinking about upcoming events and trends has proven to be a game-changing mindset that sorts the wheat from the chaff.
Personally, I'm a big advocate of drawing analogies to other industries. The car and mobility industries are some of those sectors that I'm currently looking at. As recent reports suggest, the German automotive industry is currently eyeing a massive investment in self-driving cars.
With autonomous driving and the hyperloop being at the brink of provoking a transportation revolution, one could guess that we will see a change in real estate as well. Fewer vehicles that fill the extremely scarce space in modern cities could potentially create new opportunities for construction.
The past has shown that some backlash might emerge when entering the terrain of other business areas. Whatever the reactions may be, don't let some narrow-minded experts tell you that one should not interfere with other industries. In the end, it's that forward thinking that sets you apart and secures your place in the German real estate market.