NAICS Code For Real Estate: What It Is & How To Find It | BiggerPockets Blog

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As a real estate investor, you must understand the NAICS code relevant to your industry.

This article discusses the ins and outs of this code system and its impact on your business.

What is the NAICS Code?

The North American Industry Classification System (NAICS) was developed by the United States, Canada, and Mexico to classify companies into industry-specific categories for economic data collection, analysis, and reporting.

In some states, providing your NAICS code is optional, but in others, providing your code will be required.

Why do I need a NAICS code?

While NAICS code won’t make or break a Real estate investment businesscan be useful in certain situations.

Economic tracking and analysis

Governments and researchers use NAICS codes to track economic activity, analyze growth trends, and predict future performance. If you are in the real estate business, using the appropriate NAICS code helps ensure that data about your sector of the economy is accurate.

loan request

When applying for business loans or lines of credit, financial institutions often request the NAICS code to better understand your industry and its potential risks. The law helps them make informed decisions about your eligibility and loan terms.

Commercial licensing and zoning

Some local governments require the NAICS code when applying for business permits or determining the appropriate property division. The code helps the authorities understand the nature of your business.

tax purposes

Some tax deductions and credits are industry specific. The Internal Revenue Service (IRS) and other tax authorities may use NAICS codes to determine eligibility for these tax benefits.

insurance

NAICS codes are often used by insurance companies to understand the risks associated with a particular business. This helps them calculate appropriate insurance premiums.

business relations

If you work with other businesses, such as contractors or suppliers, they may request your NAICS code to better understand your business and its needs.

Where can I find my NAICS code?

visit NAICS website To determine the NAICS symbol for the LLC. You can find your code using either the keyword or industry search options.

If you are using the keyword method, type the seed term for your industry in the “NAICS Keyword Research” field. Hit submit and search through the results until you find the symbol most relevant to your industry.

You can also use the industry research method. This involves selecting your business sector (in this case, real estate) from the industry list below the search bar. The NAICS code corresponding to your industry will be displayed.

For further assistance in determining the NAICS code for your LLC, consider calling the US Census Bureau at 1-888-756-2427.

Common NAICS Codes for Real Estate Investment

Here are some of the most popular NAICS codes for real estate related companies.

• 531110: Renting residential buildings and dwellings. This applies to investors who rent out residential properties such as apartments, townhouses, and condos.
• 531120: Renting non-residential buildings (except for mini-ware houses). This symbol is used for investors who rent commercial real estate such as office buildings or shopping malls.
• 531130: Rental of small warehouses and self-storage units. This code applies to investors in self storage or small warehouse businesses.
• 531190: Other real estate lessors. If the investor rents other types of real estate not mentioned above, he will use this code.
• 531210: offices of real estate agents and brokers. If the investor is also working as a real estate broker or agent, they will use this code.
• 531311: Residential property managers. Investors who manage residential properties for themselves or others may use this symbol.
• 531312: Non-residential property managers. This law applies to investors who manage non-residential real estate.
• 531320 Real estate appraisers offices. If the investor also values ​​the property, he or she will use this code.
• 531390: Other activities related to real estate. This comprehensive code covers other real estate activities that do not fit into the other codes.

As you can see, there is a code for every type of real estate business. Your NAICS code must reflect your core business activities.

Conclusion

It doesn’t matter whether you sell real estate, rent real estate, or engage in some other type of investment-related activity, understanding and using the appropriate NAICS code for your real estate business is essential for economic tracking, loan applications, tax purposes, and more.

As a real estate investor, you can use this rating system to improve your business visibility and streamline various processes related to licensing, zoning, and financing.

Note by BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.