Over the last 10 years, crowdfunding has increased in popularity as Real Estate Investors from around the world have taken to crowdfunding platforms like CrowdRise, to invest in multi-family and single-family real estate around the world.
One of the primary benefits of crowdfunding is that with this platform, it’s possible for anyone to get started with real estate investing for the first time, or to build a portfolio of investment properties, without having to actually manage those properties themselves.
Thanks to the popularity of crowdfunding, the Securities and Exchange Commission recently amended the 1933 Security Act. The changes include making several changes like increasing the maximum raised under regulation crowdfunding from $1.07 million to $5 million, and they also made several other changes as well including removing investment limits for accredited investors.
How Will These do Changes Affect Real Estate Investing?
With the recent actions by the Securities and Exchange Commission, much of the previous crowdfunding regulations that investors have dealt with in the past have been eliminated. This makes it easier for Real Estate Investors to raise capital for future real estate investment projects, especially from accredited investors, using crowdfunding platforms like CrowdRise.
Besides changing the amount of money that accredited investors can invest in a property through a crowdfunding platform, the SEC also changed investment limits for non-accredited investors, allowing them to invest more money in real estate investment projects than they previously were able to in the past.
Demo Day And Test The Waters Communication
The recent changes by the Securities and Exchange Commission are sure to excite many investors who have been either considering getting started with crowdfunding for the first time, or investing more money in real estate via crowdfunding in 2021.
Another change by the Securities and Exchange Commission was implementing a process called testing the waters. This allows sponsors to test work through deals to see if their investors who may have an interest in those deals, before they take the time and expense of filing with the SEC.
Real Estate Investors will also be excited about the fact that the Securities and Exchange Commission also recently liberalized demo days. These are events which are designed to allow sponsors to discuss deals with their prospective investors before they actively start soliciting Investments.
How Real Estate Investors Will Benefit
During these times of unprecedented economic and political uncertainty, and with the threat of more economic uncertainty due to Covid-19 in the future, the SEC has acknowledged through its actions the need for extra liquidity, particularly to small and medium-sized enterprises.
As with all Jobs act related changes, these modifications are primarily designed to benefit community businesses. However, as almost every new real estate project starts with the formation of a new company to manage that project, they also benefit from these changes. The SEC’s recent announcements are particularly important for real estate entrepreneurs, as they significantly increase the sources one can use to raise capital.
Invest In Multifamily Properties In 2021
2021 is going to be another excellent year for real estate investing nationwide.
If you’re planning on investing in real estate for the first time, or are thinking about adding new properties to your portfolio of investment properties, here are several tips that you can use to find the right property.
Tip #1 – Target The Right Area – 2020 was a year that was full of social and economic unrest. Sadly, many cities are still reeling from the unrest that they faced last year. This means that investors who are planning on investing in cities like Chicago, Seattle, Minneapolis, or San Francisco should take the time to do their due diligence and learn more about the city that they plan on investing in before they spend their hard-earned time in money investing there.
Tip #2 – Choose The Right Property – Once you have a target area, the next thing that you want to do is determine the type of property that you are searching for.
With multifamily properties, there are a wide variety of property types to choose from including Class A, Class B, and Class C Multifamily Properties.
Since the economy has been on shaky ground over the last twelve months, many renters are downgrading from Class A rental properties, to Class B properties, because, Class B properties are typically last expensive, and they appeal to a wider group of renters than Class A properties.
During the process of searching for a multi-family property, you should ideally be looking for a property that has a minimum of two to three rooms per unit. This is ideal because most people want to have at least two bedrooms in the property that they rent.
You should also choose a property that has amenities including on-site laundry, covered parking, a play area for children and the property should also be located close to shops, stores, and things to do in the local area.
Tip #3 – Make Sure The Property Makes Sense Financially – Even though you may be able to find some great deals in 2021 since there should be a fair number of investors who are going to be selling after coronavirus related boxes, the most important thing that you should do when investing in a multi-family property is to make sure that the property makes sense financially.
Once you find a property that you’re interested in investing in, the best way you can make sure that the property makes sense financially is by doing your due diligence. This means that you take the time to have the property inspected from top to bottom just so that you can verify that it does not have any signs of deferred maintenance. You should also inspect the rent roll and also verify the monthly expenses that the property has as well.
Partner with Trier Financial
Are you an accredited investor who is ready to make a move on investing in a multi-family property in 2021? If so, you know that time is money, and investing in a multi-family property yourself it’s going to require work.
Thankfully, when you partner with Trier Financial, you can rest easy and knowing that our team will save you the time, money, and hassle of investing in multifamily properties yourself.
We are a private equity firm that makes it easy for you to passively invest in lucrative apartment building syndications.
Finally, you can invest in tax-advantaged real estate without having to deal with the nuance or complication of purchasing and managing a property yourself.
To learn more about the benefits that come from partnering with us, contact me today for a Discovery call by calling (630) 229-2383 or click here to connect with me online.