The first step to successful real estate investment is choosing a reliable real estate investment company as your partner. It is no exaggeration to say that the success or failure of your investment depends on which company you choose. In fact, it has been pointed out that “choosing the wrong company as your partner can result in significant losses.” In this article, we will explain the key points to look for when identifying a reliable real estate investment company that beginners can trust to manage their assets. We have compiled a list of 19 important points to consider when searching for the best partner, including common pitfalls and comparisons of different types of companies. By reading this article, you will gain the knowledge you need to confidently choose a real estate investment company.
There are various types of real estate investment companies, but the most important thing is to check whether the company is trustworthy. Below, we present a checklist of 19 points that beginners should keep in mind. Check each one carefully to identify the real estate investment company that will be the best partner for you.
The first step in selecting a real estate company is to confirm whether it holds a real estate brokerage license. To operate in the real estate industry, a license issued by the governor of the prefecture or the Minister of Land, Infrastructure, Transport and Tourism is required. The license number can be verified on the company's official website or at its office. The numbers inside the parentheses in the license number indicate the number of renewals, with larger numbers indicating longer operating history. For example, “(3)” means two renewals (approximately 10 years of continuous operation). Companies with longer operating histories tend to have more experience and a proven track record. Be cautious if the license number is unclear or has expired.
A company's capital is one of the indicators used to assess the scale and stability of its operations. Generally, companies with larger capital amounts tend to have larger business scales and are expected to operate stably and provide reliable services. Especially in real estate investment, which requires long-term management, it is reassuring to choose a company with a solid financial foundation. However, newly established companies with very small capital may face risks of being unable to provide sufficient support in the future, so it is advisable to also check the financial status (such as the equity ratio or capital amount) if possible.
Number of employees is also an important point to consider when assessing company size. A larger workforce typically indicates extensive transaction experience and higher profits, suggesting a company that invests in personnel to improve services. In Japan, most real estate companies are small-scale with fewer than 20 employees, and those with over 100 employees are very rare. Companies with a large number of employees are expected to have strong management capabilities and organizational strength, but on the other hand, smaller companies may have a higher workload per employee and may lack adequate support. It is important to check both the capital and the number of employees to select a company with an appropriate scale.
The number of years since founding or the number of years in operation is also an indicator of reliability. Companies that have been in business for 10 or 20 years have likely gained the support of many customers and accumulated expertise over time. Real estate investment is a long-term endeavor, so a company with a long history is expected to have abundant management and operational expertise and stable operations. Of course, being old alone is not a guarantee of quality, but a well-established company with a track record is generally more reassuring than a newly established one. The company's history and year of establishment are also important points to check.
It is also important to assess the company's past performance and how much of that information is disclosed (transparency). Specific performance metrics include the following:
Companies that transparently disclose these figures and performance on their official websites or brochures are considered reliable. Companies that provide specific data such as “〇〇 cases of performance” or “〇 years consecutive customer satisfaction ranking of ○” demonstrate confidence in their performance. Conversely, companies with unclear performance records or those that emphasize exaggerated figures should be approached with caution.
Each real estate investment company has its own specialties in terms of property types. For example, some specialize in single-family homes, while others focus on apartments, and within apartments, some specialize in entire buildings or individual units, or in new construction versus existing properties. It is important to choose a company that handles the type of property you wish to invest in. For example, for beginners, companies that handle “newly constructed apartment units” are often considered a good starting point. Ensure that the types of properties the company handles align with your investment objectives (e.g., long-term stable income or high returns).
Some real estate companies operate nationwide and handle a wide range of regions, while others are deeply rooted in specific regions. Check each company's “service area,” which reflects their extensive information network, and determine if it aligns with the region where you want to invest. Generally, companies specializing in urban properties are strong at mitigating vacancy risks, and those with many properties in Tokyo's central areas or major cities are suitable for stable operations. On the other hand, companies specializing in rural areas or specific regions have the advantage of being well-versed in the local market trends and landowner networks. If you have a clear target area, choosing a company with a strong presence in that area increases the likelihood of being introduced to properties that align with your goals.
Check how many qualified professionals with specialized knowledge are employed within the company. In addition to real estate brokers (Real Estate Broker License holders), having staff with various qualifications related to real estate investment (such as Certified Property Managers, Financial Planners, Mortgage Advisors, and Inheritance Consultants) indicates that the company has a robust system in place to handle a wide range of consultations. Some companies have few qualified staff and focus solely on sales, so the expertise of the staff is an important criterion. Companies with many qualified staff are more likely to provide comprehensive support, including reviewing repayment plans and tax and inheritance consultations, making them a reliable partner for beginners.
It is important to consider whether the company will handle post-purchase operations, including rental management. Real estate investment companies can be broadly categorized into two types: those that only handle sales and brokerage, and those that handle everything from purchase to post-purchase rental management. For beginners, we recommend the latter, one-stop service companies. This is because handling tenant recruitment, rent collection, and complaint resolution after purchasing a property can be very time-consuming and stressful for owners, so it is more reassuring to entrust these tasks to professionals. Companies that handle property management can also provide proposals considering future operations at the time of purchase and eliminate the need to search for a separate management company. Check the official website for phrases like “property management for X units” or “tenant recruitment services available,” or ask the sales representative if property management can be included.
The post-purchase support system is also an important checkpoint. After purchasing a property from a real estate investment company, it is common to entrust them with rental management and building maintenance, but this is only the bare minimum. For long-term peace of mind, additional support is essential. Companies that offer the following comprehensive support are reliable:
With such support, you can significantly reduce the anxiety and hassle associated with purchasing a property. Check the company's website for service details or ask specific questions about post-purchase support during a seminar.
Free seminars and individual consultation sessions hosted by the company are particularly beneficial for beginners. Companies that regularly hold seminars on the basics of real estate investment and the latest information are likely to be customer-oriented and reliable. In fact, attending a seminar provides an opportunity to assess the quality of the staff and get a sense of the company's atmosphere. Individual consultation sessions allow you to speak directly with a representative, making them a valuable opportunity to confirm the company's corporate philosophy and specific support services. Companies with a strong track record of hosting seminars or actively accepting online consultations are likely to be a reliable partner for beginners.
To determine whether a company has a customer-first mindset, specifically assess whether they thoroughly listen to the customer's situation and preferences and propose properties that align with their needs. A reputable real estate investment company will not simply push properties they want to sell but will instead introduce properties that are optimal for each customer's financial situation and objectives. Pay attention to whether they avoid aggressively recommending high-priced properties that do not align with the customer's assets or income, and whether they take the time to listen to the customer's detailed preferences. In the past, there have been reports of malicious cases where customers were pressured into taking on excessive loans that did not match their income (e.g., proposing a loan exceeding 50 million yen for an annual income of 5 million yen). A company that genuinely listens to your concerns, considers your perspective, and makes proposals accordingly is the kind of partner you can trust for the long term.
Be cautious of companies that emphasize only the benefits of real estate investment, such as “real estate investment is guaranteed to be profitable,” without adequately explaining the risks. All investments carry risks and drawbacks, and real estate investment is no exception. Risks include vacancy risk, rent default risk, maintenance costs, and interest rate hike risk, among others. A trustworthy company should clearly explain these risks before signing a contract and provide specific countermeasures. For example, they should honestly disclose negative information such as, “This area has low vacancy risk due to its proximity to a university, but there is a possibility of reduced demand if the university relocates.” If a company does not explain risks at all during seminars or meetings, or makes casual statements like “It's absolutely fine,” it is not trustworthy. A company that honestly discusses risks and proposes countermeasures is worthy of trust.
Ultimately, the trust you have in the individual representative is also important. In addition to whether the real estate investment company is trustworthy, assess whether the sales representative is a trustworthy person. Specifically, check the following points:
Additionally, companies where the company's management philosophy is deeply ingrained in the workplace tend to have well-trained representatives who provide sincere service. The impression you get during the initial meeting or seminar is also important. Since you will be entrusting your asset management to someone you will work with long-term, take the time to thoroughly assess whether they are trustworthy. If you feel that the representative is not a good fit, do not hesitate to request a change of representative.
Unfortunately, there are some companies in the real estate industry that use illegal or dishonest methods. To determine whether a company is trustworthy, it is important to confirm their attitude toward compliance with laws and regulations. For example, companies that post “bait ads” (illegal advertisements using non-existent properties with attractive conditions to attract customers) are completely unacceptable. A typical example of a bait-and-switch advertisement is when a company responds to an inquiry by saying, “That property has already been sold,” and then tries to sell you a different property. This is illegal and a tactic used by unscrupulous companies. Additionally, whether a company has received administrative penalties in the past or is a member of industry associations (such as the All Japan Real Estate Association or the Real Estate Fair Trade Council) also affects its reliability. Member companies are expected to adhere to certain rules, such as self-regulatory advertising guidelines and training programs. Furthermore, whether the company demonstrates a willingness to listen carefully to customers during sales calls is an indicator of integrity. It is important to choose a company with a strong compliance mindset that avoids aggressive sales tactics or illegal behavior.
When purchasing a property, you will always receive an “important matters explanation” and a contract document. At this time, it is important to ensure that the contract contents are explained in detail. A trustworthy company will break down technical terms and explain each point clearly to ensure the customer understands and agrees. While important matters explanation documents and contracts contain many legal provisions, it is important to confirm whether the company provides clear answers to any questions. If the explanation is vague or the representative dismisses details with phrases like “the details aren't important,” this should raise concerns. To prevent post-contract disputes, choose a company that leaves no room for ambiguity. For example, ensure that conditions regarding deposits, penalties, and the possibility of canceling the contract are clearly explained. Incomplete contract documents or insufficient explanations directly impact the company's reliability.
Reviews and reputation from actual users who have purchased or managed investment properties through the company can also be helpful. These days, you can find various reviews online or on social media, so try searching for terms like “Company Name Reputation” or “Company Name Investment Reviews.” Of course, reviews are subjective and vary widely, but companies with many satisfied customers are generally more reliable. Especially if a company prominently features “Customer Voices” or interviews on its website, it indicates high customer satisfaction and confidence in their services. On the other hand, it is advisable to avoid companies with a significant number of negative reviews online. While some may be due to beginners' mistakes or lack of knowledge, companies with no notable achievements and only negative reviews should be avoided. Reviews are merely supplementary information, so make a comprehensive judgment by considering factors such as company size and track record.
Since real estate investment often involves obtaining loans from financial institutions, it is important to check how many financial institutions the company has partnerships with. Companies with multiple partnership banks (3–5 or more) are evidence of high evaluation from financial institutions. Having more partnership banks expands loan condition options, making it easier to choose terms such as interest rates and group insurance (cancer coverage, etc.) that suit your needs. Additionally, some major real estate investment companies may offer preferential interest rates through their partnered banks. During a consultation, ask, “Which financial institutions do you partner with for loans?” If multiple names are mentioned, this can be a reassuring factor. Conversely, if the number of partnered institutions is extremely limited, loan conditions may be restricted, potentially leading to unrealistic plans. Companies with a wide range of financing options offer greater flexibility in funding plans and are recommended.
Finally, it is important not to make a decision based on a single company but to compare multiple companies. As pointed out, “First, select multiple real estate companies and thoroughly compare their strengths and weaknesses.” By considering multiple candidates, you can identify each company's strengths and weaknesses. For example, one company may have a wealth of property information but lack support, while another may offer excellent support but handle a limited range of properties. By contacting multiple companies, you can also clarify the type of company that suits you best. Additionally, by comparing the information you receive from the first company with that from the second, you can make a more objective judgment. Seek a second opinion by consulting multiple companies and choose the best partner overall.
Here are some common mistakes made by beginners in real estate investment when choosing a partner, along with ways to avoid them. Knowing these in advance can help you avoid making the same mistakes.
Real estate investment companies can be categorized into several types based on their scale and business structure. Here, we will compare the differences between “locally focused” and “nationwide” companies, as well as “brokerage companies” and “development (developer) companies,” and explain their respective characteristics. Use this information to help you choose the type of company that best suits your needs.
【Locally focused (mostly small and medium-sized companies)】 and 【Nationwide (mostly large companies)】 have the following characteristics:
Which is better depends on your investment strategy. For those who want to search widely without limiting the area or prefer new construction properties, nationwide companies are suitable. On the other hand, for those who have a specific investment area and target high-yield used properties, locally focused companies are more suitable as they can gather information more effectively. Choosing the one that aligns with your strategy is key.
Real estate investment companies can be broadly categorized into brokerage companies and development/sales companies (developers) based on their business models.
When choosing a company, it is recommended that beginners opt for a development-oriented company (self-owned property sales company) that can handle everything from purchase to management. On the other hand, once you become familiar with the real estate market, it can be effective to use a brokerage company to find hidden gems among used properties. When evaluating new construction developers, it is advisable to look at the number of buildings and units they have developed in the past, occupancy rates, and management performance.
For used property brokerage companies, “annual brokerage transactions” and “number of managed properties” are key indicators of their capabilities. Choose a company that specializes in the type of property you are seeking.
We provide easy-to-understand explanations of specialized terms related to real estate investment and selecting real estate companies that appear in the main text.
For beginners in real estate investment, selecting a trustworthy real estate investment company is the first and most critical hurdle. However, by utilizing the checklist in this article, you should be able to confidently identify a reliable partner. By comprehensively evaluating objective indicators such as capital and track record, as well as the character of the staff and after-sales support systems, you will be able to identify the company you can entrust with your investment. In fact, it is often said that “choosing a reliable real estate investment company is more important than selecting properties,” highlighting the importance of partner selection. Take your time to compare multiple companies, clarify any doubts, and find the best real estate investment company to partner with. By working hand in hand with the right company, you will be well on your way to achieving success in real estate investment. We hope that your first step will lead to a stable income in the future.