Understanding Investment Properties: What Every Agent Needs to Know

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Investors Have Been On Their Own (Until Now)

Here’s a wild thing Bob Helms points out in Chapter 3. Real estate investors have basically had to figure everything out by themselves. For years, almost nobody in the agent world was actually helping them find performing properties, analyze deals, or think through tax strategies. Investors were just out there winging it.

And that’s why Helms wrote this chapter. He wants agents to step up and become what he calls Investment Property Specialists (IPSs). The idea is simple: learn to think like an investor so you can actually help investors. But here’s the thing. You can’t just slap “investment specialist” on your business card and call it a day. You need to understand the full picture. Property types, market analysis, cash flow, management, the whole thing.

Start With Your “Why” Before Picking a Property

This is probably the most important takeaway from the chapter, and it’s one most people skip over.

Helms says picking a property is literally the LAST step. Not the first. Most new investors do the opposite. They get excited, see a building for sale down the street, and start writing offers before they even know what they want their portfolio to look like.

Before you even look at listings, you need to figure out:

• Why real estate? What’s your actual goal? Cash flow? Retirement income? Both?
• What type of property? Condos, single-family homes, duplexes, small apartment buildings, mobile home parks, storage facilities, commercial properties?
• Where? Three blocks from home or three states away? Maybe another country?
• Alone or with partners? Do you have the cash, credit, and time to do this solo?

Helms is big on writing all of this down. Not a fancy business plan, just a clear written statement of your investment philosophy. He calls it PLAN, DO, REVIEW. You make a plan, execute, then look at what actually happened versus what you expected. Then you adjust. That cycle is how you get better over time.

I really like this advice because it forces you to slow down. Most people jump in too fast and end up owning a property that doesn’t match their actual goals.

Choosing a Market Before Choosing a Property

Helms uses this funny example of a fictional town called Appaloosa, Kentucky with a college, a medical school, and a state prison. Sounds stable, right? But he says you can’t just assume. You need to actually analyze whether the local market has enough jobs, industries, and rental demand to keep your units occupied at rates that produce positive cash flow.

The question you need to answer: “Does this market have enough economic diversity to keep tenants in my units for the foreseeable future?”

If the answer is no, it doesn’t matter how cheap the property is. A “great buy” in a weak market is still a bad investment.

This part stuck with me because it’s so easy to get distracted by price. A property might look like a steal on paper, but if the local economy can’t support consistent occupancy, your numbers will never work out.

Building Your Team

Once you’ve picked your market, Helms says you need to assemble a full team before you start making offers. And that team is bigger than most people realize:

• Realtor/Agent (ideally one who’s also an investor)
• Lender or loan broker
• CPA or tax attorney
• Real estate attorney
• Insurance agent
• Property and pest inspectors
• A qualified intermediary for 1031 exchanges
• Property manager

Helms drops a note here that I think is gold: ideally, every member of your team is also an investor. People who invest themselves understand your goals differently than people who just work in the industry. They get the urgency, they get the numbers, and they can spot problems you might miss.

He also mentions that you might need 10 to 20 independent service providers involved in a single transaction. That’s a lot of moving parts.

Property Management: The Make or Break Decision

The second half of this chapter gets into property management, and Helms doesn’t sugarcoat it. The single biggest factor in your financial success as a landlord comes down to two things: keeping occupancy high and keeping turnover low.

Every month a unit sits empty, you’re losing money. Every time a tenant leaves and you need to find a new one, that costs money too. So the question becomes: do you manage it yourself, or do you hire a professional property manager (PM)?

Helms acknowledges that many successful investors believe “life is way too short to manage my rentals myself.” And honestly? He seems to lean that way, especially for properties that aren’t close to where you live.

Professional PMs typically charge 5% to 12% of rents collected. They handle everything from advertising vacancies and screening tenants to collecting rent and coordinating repairs. Some charge extra to place a new tenant, sometimes up to one month’s rent, but they’ll usually guarantee that placement for six months.

Here’s a practical tip from Helms: if a PM charges you a minimum monthly fee whether the unit is rented or not, be cautious. That removes their motivation to fill your vacancy quickly.

Know the Rules of Your Market

Helms spends a good chunk of time on rent control laws, and for good reason. States like California and New York are “tenant friendly,” meaning the courts and regulations strongly favor tenants. Some cities have rent control ordinances that can seriously limit what you charge and when you can change tenants. This directly hits your bottom line and your property’s market value.

His advice is clear: know the political climate of your market before you invest. And if rent control is too restrictive in one area, look somewhere else. He even notes that commercial properties (retail, office, industrial, storage) have virtually no rent control restrictions, which is one reason some investors prefer that space entirely.

The Bottom Line

Chapter 3 is a reality check. It’s the “slow down and think first” chapter. Helms isn’t trying to discourage anyone from investing in real estate. He’s invested for seven decades and clearly loves it. But he wants you to go in with a plan, a team, and a clear understanding of your market before you start writing checks.

The most quotable line from the chapter comes from Helms himself: “How much will you make from real estate you don’t own?” In other words, education and planning matter, but at some point you have to take action. Just do it with your eyes open.

Next: Valuing Investment Properties

This is part of a book retelling series on “Be in the Top 1%: A Real Estate Agent’s Guide to Getting Rich in the Investment Property Niche” by Bob Helms (Robert P. Helms). ISBN: 978-0-9983125-9-0. Published 2018.