I’ve heard a lot of people go back and forth about whether or not you should join a real estate investment club as a house flipper. Honestly, I think that these organizations – if you find a good one – can be great places to network and learn about the business as you get into flipping houses. That said, if you’re not careful, you can find yourself paying monthly dues to be a member of a glorified book club and advertising scheme. That’s why it’s important to know the pros and cons and how to spot a club that’s just not worth joining.
Pro – Monthly Meetings are Great for Networking
First, if you join a real estate investment club, you have the opportunity to do some serious networking. If you regularly go to your monthly meeting, you’ll be able to connect with other flippers, investing partners, private lenders, realtors, and other real estate professionals who can help you get where you want to be in your flipping career.
Con – Monthly Fees
Most clubs will charge between $100 and $300 per month for memberships. If you’re not getting much out of going to the meetings, that can feel like flushing money down the toilet. Pay attention to the value you get from going to the meetings. Are you building your brand? Are you learning from seasoned professionals? If you answered yes to these questions, your monthly dues are probably worth the money. If not, you should consider quitting and/or finding another investment club to join.
Pro – Regular Learning Experiences
A good club will invite successful real estate investors to its monthly meetings to give helpful lectures on their experiences in the industry. When you listen to these lectures, you’ll learn about mistakes to avoid, great markets to look out for, and much more. If you look forward to your monthly meetings for the insights and advice you get from guest lecturers, you’re definitely getting your money’s worth.
Con – Book Advertisements Disguised as Lectures
On the other hand, if you choose the wrong club, you’ll notice that you get very little out of what the guest lecturers have to say. They usually won’t have much substance to their talks, but they’ll promise a lot more if you buy their books. The clubs that give these “lecturers” a platform to sell propaganda instead of giving good advice (sometimes with the added bonus of a book sale, too) aren’t usually high quality and don’t attract the best members, either. If you find yourself in one of these, I’d advise you to run straight for the door.
Pro – Investment Opportunities
A lot of clubs will have organized investment opportunities to go in on an investment together. In this kind of situation, the pooled resources of the members’ combined investments can buy something larger and more lucrative than any one investor could purchase on their own. This can be a great means to get involved with a hands-free investment opportunity that can bring in cash flow while you’re working on flipping houses.
That said, not everyone wants to get involved with purchasing and holding a condo complex or shopping mall. If you’re focused on building your real estate investment business by flipping houses, a group investment might not be right for you. However, the networking and learning experiences available through a good real estate investment club are really unparalleled. I recommend that most new flippers at least check out one of these clubs to see what you can learn and who you can meet.