In the precipitation step, a Sm source and a Fe source may be dissolved in a strongly acidic solution to prepare a solution containing Sm and Fe. When the main phase to be obtained is Sm₂Fe₁₇N₃, the molar ratio of Sm to Fe (Sm:Fe) is preferably 1.6:17 to 3.0:17, more preferably 2.0:17 to 2.6:17. To the solution may be added La, W, Co, Ti, Sc, Y, Pr, Nd, Pm, Gd, Tb, Dy, Ho, Er, Tm, Lu, or other sources. La is preferable in terms of remanence; W is preferable in terms of coercive force and squareness ratio; and Co is preferable in terms of temperature characteristics.

The Sm source and the Fe source are not limited as long as they are soluble in a strongly acidic solution. From an availability standpoint, for example, the Sm source may be an oxide of Sm, and the Fe source may be FeSO₄. The concentration of the solution containing Sm and Fe may be appropriately adjusted within a range that allows the Sm and Fe sources to substantially dissolve in the acidic solution. The acidic solution may be a sulfuric acid solution because of its ability to dissolve the Sm and Fe sources.