Real Estate Financial Analyst: Career Path and Educational Requirements

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Investment, whether carried out by individuals or corporations, is a complex and heavily regulated field, and it goes beyond stocks and bonds. Alternative investment options such as real estate properties may represent a sound option for those seeking to create strong, diversified portfolios.

To navigate the ins and outs of real estate finance, investment firms and corporate financial departments need experts—people trained and educated in real estate investment strategies. These are real estate financial analysts, and if you have a deep interest in this part of the market—as well as strong job experience and a high level of education—you can join their ranks.

A real estate financial analyst points out numbers on a graph.

Learning more about the real estate financial analyst career path, as well as the skills and knowledge you’ll have to accumulate to begin, can help you decide whether this is a goal you want to pursue. Successfully entering the field is a way to become a valuable contributor to an investment banking team.

What Is Real Estate Investment?

Adding real estate properties to an investment portfolio is a way for individuals and companies to diversify their positions, setting up a way to move beyond the market forces that affect the prices of stocks and bonds. As Investopedia noted, stability is the key advantage of spending on properties instead of other investment vehicles. The housing market tends to rise steadily, with dips only coming during major adverse events such as recessions.

The United States housing market has shown a reliable upward trend over the past 50-plus years, drawing the interest of investors large and small. Of course, there is a difference between owning and operating a property as the landlord and simply having a financial interest in it. For the latter, there are entities dedicated to managing large blocks of properties in the names of investors.

Since the appeal of real estate investing is wrapped up in the fact that the market is separate from the world of stocks and bonds, specialized knowledge is important to operate in this field. Companies and funds holding real estate in their portfolios therefore need assistance from real estate financial analysts.

What Do Real Estate Financial Analysts Do?

Real estate financial analysts serve as the strategic movers behind property investments. They perform research into market conditions and make recommendations and projections regarding the optimal use of resources. When financial analysts are operating at their best, they guide their organizations to high-return investments and build enduringly strong portfolios.

The U.S. Bureau of Labor Statistics noted that the general role of financial analyst breaks down into many such specialized positions. For each category, such as real estate, these experts seek as much knowledge as possible about the current state of the market and the trends likely to affect it. Anything from a new law to the ripple effects of major economic shifts could cause changes to residential real estate or commercial real estate values.

The typical employer of a real estate financial analyst is a large company with a sizable portfolio, according to PayScale. At this level of investment, overseeing those investments and expanding their value in the market is a major challenge, one that depends on highly specialized knowledge and insights.

While real estate investment is often taken on as a lower-risk option relative to other types, there is still a major element of risk management associated with being an analyst. Managing the future potential of an investment is an essential element of all types of financial modeling and analysis, and real estate is no exception. An expert will be able to tell a fund portfolio manager whether it is a good time to buy or sell, while identifying top opportunities before competitors.

As for day-to-day duties, analysts will spend a large amount of their time working within their own teams. PayScale explained that some projects are handled alone, while others involve more personnel contributing. In either case, the work carried out on potential and current real estate investments must eventually be communicated to decision-makers higher up in the organization. This could take the form of a weekly meeting or a monthly check-in, but it underlines the need for effective communication skills to express complex financial dealings to people outside of the section.

Real estate financial analysts should be knowledgeable in the legal ins and outs of the property field in general and their own portfolio of properties specifically. They also have to be detail-oriented and meticulous in the way they monitor markets, as it’s up to them to extract the most possible value from transactions. Taking on a role in this field is a challenging but potentially highly rewarding move for professionals who have an interest in the property and want to become central to a company or fund’s financial strategy.

How Much Can Real Estate Financial Analysts Earn?

Working as a real estate financial analyst can bring an average salary of $60,487, according to PayScale data from March 2021. That figure can rise with experience. Additional PayScale data reported by real estate analysts indicated that mid-career employees bring in an average of $70,517, while those with more years of experience earn $74,465. The top 10% of earners in the profession make more than $90,000.

Demand for financial analysts in general is in line with U.S. employment as a whole. The BLS noted the number of these analyst jobs is expected to increase 5% between 2019 and 2029, slightly faster than the 4% growth expected for all jobs.

The forces underlying this solid growth include the wide range of financial products available on the market and the need for professionals who are knowledgeable about various regions and markets. Becoming a real estate financial analyst is a way of carving out a niche within the overall investment field. Serving as the person within a financial department or investment firm who has knowledge of a specific region’s real estate market or a type of property can be a career advancement strategy.

How Can You Get Started on the Real Estate Financial Analyst Career Path?

Getting started as a real estate financial analyst means combining several kinds of knowledge. You will need to prove to potential employers that you understand the legal compliance matters that dominate the financial world while also demonstrating an ability to perform tasks such as effective risk management and accurate property valuation. It can also pay to be a team player and a good communicator, as no analyst truly works alone and you will have to express your strategies to stakeholders outside of your section.

There are various certifications financial analysts can earn to prove their expertise while aiming for advancement, no matter their specialty. This means taking the requisite exams to become a chartered financial analyst, along with putting in four years of service in the industry and having at least a bachelor’s degree in a related field. While entry-level positions in finance and investment are accessible with a bachelor’s-level education, the BLS adds that rising through the ranks as an analyst may be simpler with a master’s degree.

Investopedia noted that once they have attained higher positions in their organizations, financial analysts can change their day-to-day roles somewhat. These ranking individuals will spend more of their time dealing with management and creating big-picture investment strategies rather than performing ground-level data collection and analysis.

Investopedia and the BLS concur that career options and opportunities expand when a candidate holds a master’s degree in a related field, such as finance. The former adds that even when joining the competitive world of financial analysis for the first time, a graduate-level degree may open doors closed to those who only have a bachelor’s degree.

What Kind of Degree Program Can Prepare You to Work in Real Estate Finance?

Enrolling in an online Master of Finance degree program allows you to build your knowledge and experience while enhancing your resume. Today’s digital courses are available on your schedule, and top institutions still deliver expert-guided insights associated with their on-campus offerings.

The Online Master of Finance program from Northeastern University’s D’Amore-McKim School of Business may prove especially appealing if your planned career path leads to real estate finance. The degree’s Investment Finance track includes numerous courses focusing on intelligent and effective portfolio management, including Real Estate Finance and Investment, a class solely dedicated to the best practices of working with properties.

The syllabus for Real Estate Finance and Investment includes taxation, the types of property ownership, valuation, market analysis, mortgaging, and the strategic aspects of investment. Coupled with other courses such as Portfolio Management, Valuation and Value Creation, and Investment Banking, this class allows you to build your expertise around smart investing.

Depending on how many online courses you take each semester, it’s possible to complete the online MS in Finance program in as few as 16 months. This abbreviated schedule allows you to get on with making progress in your career, equipped with a newly enhanced knowledge of the regulations, strategies, and market forces at work in real estate investment. Whether you are aiming for advancement within a firm or seeking to change the direction of your professional life and emphasize real estate investment, such immersion in financial analysis can be a turning point.

Graphs and a city skyline symbolize property investment.

In a competitive market such as finance, the knowledge and experience you gain from well-connected industry experts can build your confidence and boost your decision-making as you take on duties that can have a major impact on the financial health of a firm.

To find out more about whether an online MS in Finance is the right degree program for your career goals, visit the program page.

Recommended Readings:
Learning About Real Estate Finance
Financial Analyst Salary for Entry-level Graduates

Sources:
PayScale —  Average Real Estate Analyst Salary
Investopedia — Different Ways to Invest in Real Estate
Investopedia — Becoming a Financial Analyst
Bureau of Labor Statistics — Financial Analysts
PayScale — Average Real Estate Financial Analyst Salary