Given the ever-changing industry standards and uncertainties in the market, it’s vital to understand investor pain points and objectives to deliver a seamless investor experience.
To help real estate investment managers understand investor expectations, AppFolio surveyed 100+ real estate investors. AppFolio’s 2023 Investor Report highlights modern investors’ top requirements when investing in real estate property and assets.
What modern investors want
How can your real estate investment management business anticipate and predict what modern investors want? Here’s what you need to know about investors’ expectations.
Robust technology and tools
Investors value technologies such as fully-featured investor portals because of their broad self-service options.
Investor portals allow 24/7 access anytime and anywhere, making downloading tax documents, getting prompt real-time investment updates, and tracking key performance metrics convenient.
The 2023 Investor Report shows that mobile investor portals are becoming more popular, increasing from 55% in 2021 to 69% in 2023.
Investment managers should adopt technologies and tools that give investors easy, real-time access and visibility into their investment documents, communications, and portfolios.
With real estate investment management software like AppFolio Investment Manager, you can manage your investor relationships more efficiently.
Software provides better accessibility and transparency to investors, ensuring seamless reporting and fundraising.
Real estate investment management software allows you to:
- Maintain productivity and efficiency in your workflows through automation.
- Provide personalized investment experiences with a robust investor portal.
- Manage property and investor data, investments, and communications in one solution, minimizing the complexities and costs of using multiple platforms.
Transparency and visibility into investments
Investors put a premium on performance and information transparency before choosing an investment management company.
Below are the latest numbers highlighting the criteria investors focus on when choosing a real estate investment management company to invest in.
- 56% of real estate investors review an investment management company’s track record before investing.
- 49% of investors assess the company’s investment strategy before hiring them.
- 44% of investors look at management fees, and 41% check the management team before choosing the company.
Data also shows that younger investors are less trusting of their managers.
However, investors are somewhat satisfied with the improved transparency between them and their investment managers.
39% of investors with higher net worths and 37% of those aged 45 years and above are more likely to promote their real estate company to friends and colleagues.
On the other hand, fewer younger investors are willing to do so.
The numbers underscore transparency and visibility’s crucial role in winning investor trust.
The more investors have confidence in you, the more likely they’ll recommend you to their network.
Real estate investment industry knowledge and expertise
Industry knowledge and expertise are two key reasons investors work with investment management companies.
Use this to your advantage by highlighting your real estate expertise and knowledge when engaging potential investors.
For example, you can publish blogs, videos, infographics, and social media content about real estate investment tutorials and tips.
Showcase your credibility by sharing content that educates and informs investors, offering value while positioning yourself as an industry authority.
A reliable communication process
Real estate investors want regular updates about the current state of the market, investment opportunities, and their portfolio performance.
According to the 2023 Investor Report, 66% of investors want updates on portfolio performance, 64% want to know about new investment opportunities, and 62% require specific property information.
The best way to get this information to investors is to maintain a regular communication and updating process.
For example, you can schedule regular meetings with investors to keep them updated on critical or specific information, including property updates, industry insights, performance metrics, and data pulled from other software relevant to investors.
Also, use your investors’ preferred communication methods and channels.
Recent data shows that 52% of investors prefer communicating with their investment managers through phone calls, while 58% want to receive regular emails.
Younger investors prefer traditional communication methods, such as face-to-face meetings and phone calls, and are more receptive to text messages and investor portals than older investors.
Accommodate various channels and methods that each investor segment prefers to make the communication process more seamless and satisfying.
The importance of understanding investor needs
Understanding the needs of investors enables you to:
- Provide the right asset selections. Investors have specific location, property type, and asset class preferences. Understanding these helps you determine the best-fitting investment opportunities that match investor requirements.
- Ensure accurate reporting and seamless communication. Knowing the investors’ preferred communication channels facilitates seamless communication and efficient reporting. Since communication is frictionless, inaccuracies and misunderstandings are avoided.
- Align investment strategies. To align your investment strategies, you must understand investor objectives, time horizons, and risk tolerance. It also helps you determine the best tools and technologies to execute your investment strategies efficiently.
Know investor needs inside and out
A successful relationship with investors starts with understanding how they think about you, your investment management company, and the market.
Knowing what investors want helps you uncover and leverage opportunities to help you win and retain new investors.
Explore the data in AppFolio’s 2023 Investor Report for comprehensive insights, enabling you to better understand investor preferences and expectations.