Steven Belmont Explains How Technology is Revolutionizing the Real Estate Investment World
“There’s an app for that!” is something we can say for nearly anything nowadays. No taxis in sight? Use Uber. Hotels fully booked? Check out Airbnb. Working remotely during COVID-19? Call up your coworkers with Zoom. These apps, along with many others, have optimized the way we live and work, by providing us with accessible solutions that are cost-effective on both time and money. Every industry is influenced by smartphone apps and other forms of modern technology, including the world of real estate investment. To effectively communicate with today’s tech-savvy homebuyers, it’s important that investors remain on top of these fast-evolving trends and learn how these new technologies can be of benefit. After building up an award-winning career in the mortgage industry, Steven Belmont, also known as Bo Belmont, became the founder and owner of Belwood Investments in Folsom, California. Along with leading his team at Belwood, he is also the co-founder of Red Door Theory, a teaching and mentoring program focused around investing. He shares his insights regarding the latest technological developments in the real estate investment industry. AI Technology While most people think of robots when it comes to AI technology, in the case of the real estate industry, we’re referring to a subtler AI technology known as machine learning (ML). When a computer is enhanced with ML, it is able to streamline processes by using predictive analytics to sift through large amounts of data and target hot leads. ML is helping real estate investors make smarter investment decisions by informing them of key information, such as when a property or neighborhood will become popular or increase in value, notes Steven Belmont. Virtual Reality (VR) and Augmented Reality (AR) Thanks to aerial footage obtained from drones and 3D technology, investors can easily immerse themselves in a virtual tour of a property anywhere around the world. Rather than engaging in the hassle of driving (or flying) several miles to engage in a property you are considering investing in, VR and AR allow you to engage in these virtual open houses from the comfort of your own living room and according to your schedule. The Sharing Economy Uber and Airbnb were the main players that kicked off a global “sharing economy” trend. Since Airbnb was founded in 2008, it has transformed the way that residential real estate is discovered, managed, and rented. While Airbnb remains the go-to platform for travelers looking for a short-term stay, other businesses have cropped up to facilitate this sharing economy. Through modern real estate companies like Zeus, businesses can rent furnished homes for extended stays just as homeowners can lease their spaces to businesses. Online Data Accessibility According to a 2016 National Association of Realtor’s study, 51% of homebuyers found their home online without using an agent. This newfound independence for homebuyers and investors can largely be attributed to a search engine known as Revestor, says Bo Belmont. Launched as a start-up in 2011, Revestor is a real estate search engine that helps investors find properties while using data to assess their potential. By allowing users to focus their searches on investment criteria, they can effectively determine whether a property matches their investing goals. The Rise of Mobility As previously mentioned, there’s an app for everything nowadays, including real estate. With apps like Zillow and Redfin, investors can browse, buy or sell a property, and get notifications for when a new listing hits the market. Their platforms also provide verified reviews and real estate data regarding property values, mortgages, and more. Start adapting and reaping the benefits, says Bo Belmont These new forms of technology are changing the rest estate investment world for the better; however, real estate professionals must swiftly begin to explore these new technologies and diversify their strategies accordingly, advises Bo Belmont. Once you become more accustomed to these tech developments and begin to implement them into your business, you’ll gain a competitive advantage and begin reaping many benefits. These changes have led to Steven creating his own model real estate investment. The B52 model was something Steven created himself which hyper leverages property investments. The 52 stands for earning 50% of a profit for only 20% of an investment. When there is a project, an investor only comes in with the cost of the project at 20%. Meaning, if the project is $100,000, they only come in with $20,000. Yet, when the project is completed, the profits are not split up 80/20. The profits are split up 50/50. So, it’s 50 percent profit for 20 percent investment. This method of investing in real estate has never ben done before. In California, the investments tend to be from on the low $20,000+ and the average Joe does not have those type of funds in America. That is more reserved for the upper middle class in California and in the wealthier states. However, if a home is bought in South Carolina where the cost is only $30,000 and it is remodeled for $30,000 then the total project cost is $60,000. Now, the investor can come in with $12,000 and then it becomes a lot more affordable. Which is why this model is so ground-breaking. The flexibility it provides allows those who wouldn’t normally get involved in these types of projects invest. Now they get to participate in flipping a home from the comfort of their own home, for a fraction of the cost and the investment doesn’t go to anybody’s account, it goes as a second deed of trust onto the property. What that means is if anything negative does happen, the money is still secured to that property as a deed of trust. It’s a secured investment and one that has been averaging investors over 32% in 122 days proving the formula works.