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How a RIA Can Help Manage Your Real Estate Investments


Registered investment advisors (RIAs) give investment advice to clients in a fiduciary capacity. RIAs can help with managing a variety of investments, including real estate holdings. If you hold property in your portfolio or are considering adding this asset class, you may benefit from working with an RIA real estate expert. Looking for expert investment advice? Consider connecting with a financial advisor today.

Understanding Registered Investment Advisors (RIAs)

An RIA can be an individual advisor or advisory firm that offers investment advice to clients. RIAs must register with the Securities and Exchange Commission (SEC) or an equivalent state agency, depending on their assets under management (AUM). Regardless of where they’re registered, an RIA must adhere to a fiduciary duty. That means they’re obligated to act in clients’ best interests at all times when making portfolio recommendations or offering investment advice.

In exchange, RIAs receive compensation from their clients. An RIA may charge a flat fee or a percentage of assets under management. A typical financial advisor’s annual fee is around 1% of AUM.

The types of investments RIAs offer advice on can vary but the list may include stocks, bonds, mutual funds, real estate and private investments. The full scope of services that an RIA may offer can include:

  • Investment management
  • Financial planning
  • Tax planning
  • Retirement planning
  • Estate planning
  • Wealth management
  • Risk management

RIAs that register with the SEC are required to disclose the details of how they do business, including the services offered, how they’re compensated and any potential conflicts of interest. State regulatory agencies can determine what requirements to impose for registration.

RIA Real Estate Management

RIAs can advise clients on a variety of investments, including real estate. Some of the things they may advise on include:

  • Identifying promising properties to acquire
  • Choosing real estate investments for diversification
  • Developing exit strategies from property investments

Real estate investments can be more complex than other types of investments because there are so many variables that can affect outcomes.

For instance, while the real estate market has a relatively low correlation to stocks, it’s not immune from the impacts of changing interest rates. When interest rates rise, it becomes more expensive to borrow money to finance real estate investments. An RIA can offer advice on how to manage that type of situation if you’re running into obstacles expanding your property portfolio.

RIAs may offer general real estate investment advice or specialize in a particular niche. For instance, rather than advising clients on how to manage commercial real estate investments, they may narrow that down to just one or two property types. So, if you’re interested in making investments in storage or warehouse space, for example, you might look for an RIA that’s well-versed in those areas.

Additionally, RIAs may target a specific type of client, such as high-net-worth or ultra-high-net-worth individuals. Someone who is considered to have high net worth has at least $1 million in investable assets, while ultra-high net worth refers to people with $30 million or more in liquid assets.

Investing in Real Estate With an RIA

An RIA meeting with clients to help them manage their real estate investments.

RIAs may recommend a variety of property investment vehicles to their clients who are interested in diversifying with real estate. The options may include:

  • Real estate syndication
  • Real estate investment trusts
  • Private funds

Real estate syndication deals involve a group of investors who pool money together to invest in real estate, typically commercial properties. This is more commonly referred to as real estate crowdfunding. In terms of its appeal, syndication can remove some of the barriers to entry that are often associated with real estate investing. Syndicated deals may have a low minimum investment to buy in while offering investors exposure to a variety of income-producing properties.

Real estate investment trusts or REITs are legal entities that invest in and manage real estate. The primary advantage of investing in REITs is the opportunity to collect a steady stream of dividend payments. RIAs may recommend a variety of REIT options to clients that align with their risk tolerance and goals.

Private real estate funds are a third option RIAs may offer to clients. These investments typically require a much larger amount of capital to buy in, which may limit their accessibility to high-net-worth or ultra-high-net-worth individuals.

Who Can Benefit From Seeking RIA Real Estate Advice?

Choosing a financial advisor is an important decision as you want to work with a trusted professional who understands your goals. Whether it makes sense to work specifically with an RIA for real estate (and pay their fees) can depend on a few things, including:

  • The size of your portfolio
  • The scope of property investments you have
  • How comfortable you are managing investments on your own

Keep in mind, of course, that an RIA can help you to manage more than just real estate. They can look at each of the investments in your portfolio and offer advice on how to manage them, which is something you may appreciate if you’re looking for a comprehensive approach to financial planning.

If you’re searching for an RIA to work with, it’s helpful to know what to consider when choosing one. Some of the most helpful questions to ask include:

  • What services do they offer?
  • What types of investments do they offer advice on, including real estate investments?
  • Are there any real estate investment vehicles they don’t offer advice on?
  • Is there a particular segment of the real estate market they’re especially knowledgeable about?
  • Is there a minimum net worth you’ll need to have for them to take you on as a client?
  • How are their fees structured and what do they charge for their services?

Aside from these questions, it’s also helpful to understand how an RIA operates on the back end. For instance, what is their preferred method for communicating with clients? How often will they communicate? And do they have a team that will assist them?

Bottom Line

An RIA discussing real estate investments with a client in a video meeting.

Real estate can help to balance out your portfolio and potentially provide some insulation against inflation or economic downturns. Choosing an RIA real estate expert to work with could prove helpful if you’d like to have professional guidance on how to grow wealth with property investments.

Investing Tips

  • Finding the right advisor to work with can be critical, as you want to connect with someone who understands your goals and concerns. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • In addition to real estate syndication, REITs and private funds, there are other ways to add property to a portfolio. For instance, you might decide to purchase a rental property to generate passive income or try your hand at fixing and flipping homes.

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