Many families are turning their eyes towards real estate syndication—a tried-and-true method to culminate enduring fortune. But what does it really mean?–In layman’s terms, a real estate syndication is a pool of investors that band together to purchase commercial or residential properties. In this setup, a point person–or general partner, handles all the logistics while the investors–or limited partners pull out their wallets.
Every real estate investment carries a certain degree of risk but syndications give benefits that are too large to ignore. Typically, syndications will return 8% over five years and up to a whopping 50% surge on your initial investment at the term’s conclusion. So, hypothetically speaking, investing in a syndication with these conditions might double your money in half a decade.
After gathering the funds, the general partner will go to town on renovations and repairs, nurturing the property to a point where they can demand higher rents. As the value of commercial properties arises from the rent they bring in, any increase in price turns up the property’s worth. Five years down the line, most syndications aim to make a graceful exit by selling the remodeled building at a decent profit, which is shared among the limited partners.
Multifamily Properties: The Path to Wealth
That said, you don’t have to join syndications to climb aboard the investment train. Depending on your wallet’s depth, you can single-handedly invest in multifamily real estate. This covers any establishment with more than four units; it’s not difficult to find a property that fits the bill.
When pitted against single-family properties, the perks of multifamily homes shine brighter. The largest of these perks being consistent cash flow. A single-tenant property can be a double-edged sword—if the tenant decides to up and leave, your cash flow grinds to a halt. But with a multifamily property in your pocket, the worry of losing income reduces drastically. If a tenant departs, others fill in the gap, delivering unbroken cash flow.
So, looking at the long term, multifamily properties propose a reliable method to build generational wealth. A selection of multifamily apartments can safeguard a regular passive income for you and future generations.
Real Estate Investment Trusts
Another noteworthy player in real estate investment are REITs—companies that own and usually oversee income-generating real estate. REITs can be traded on public exchanges, meaning you’re buying a piece of a company rather than the property itself.
While REITs may not pack the same punch as syndications, their returns aren’t anything to sneeze at. They align more with stock market returns, making them an accessible way to widen your real estate portfolio’s horizons.
Follow the Sun to Florida
Shifting the lens to the sunny state of Florida, its real estate market is experiencing a surge. People are flocking to the sandy beaches and halcyon weather, making real estate a hot commodity. But why the sudden interest?
As anyone familiar with Florida can testify, it boasts a paradise-like environment year-round. The appeal of having a slice of paradise to call home attracts many to invest in property. Plus, in the context of generational wealth, leaving behind a home in Florida is a substantial inheritance for next generations.
Estate Planning with a Tampa Lawyer
As you delve deeper into the realm of real estate investment, you might appreciate the guidance of a Tampa estate planning lawyer. They can provide a hand in strategizing your investments and provide legal assistance as you secure your vision of generational wealth.
All in all, the world of real estate offers a multitude of paths for you to explore. Whether it’s joining a syndication, delving into multifamily properties, or investing in REITs—there’s a piece of the pie for everyone. And if luck favours the brave, then real estate investment is indeed a fortuitous undertaking.
