Real Estate Syndication

Real estate has always been an investor favorite and the evolution of real estate syndication has made what was once a market only available to the ultra wealthy a possibility for many more people. 

However, before jumping in, it’s essential to understand the basics of how real estate syndication works, the pros and cons of this type of investment and how to get started safely in ways that minimize risks.

What Does Syndication Mean in Real Estate?

Real estate syndication is a partnership with several investors who pool their capital and skills to purchase and manage property. It was a precursor to real estate crowdfunding and now these terms often get used interchangeably. 

How Does Real Estate Syndication Work?

Real estate syndication spreads out investors’ risk and takes away a substantial amount of responsibility. For example, pretend you’ve set aside $50,000 to invest in real estate. One option would be to put a down payment on a single rental property and rent it out to one tenant. 

Why Do People Engage in Real Estate Syndication?

One of the main reasons people engage in real estate syndication is that the heavy lifting is done for you. Rather than researching hundreds of properties, obtaining the ones you think will succeed, and then managing those properties, you can just sign up for a real estate syndication platform. 

Is Investing in Real Estate Syndications a Good Idea?

Depending on who you team up with, the minimum investments can also be very high. Having a high amount of funds illiquid for several years isn’t an option for everybody. It’s also essential you work with a trusted syndication sponsor. If you take a risk on somebody new to syndication, you drastically increase your risk and profits may suffer. 

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