Top 4 Things to Know for Investing in a Real Estate Syndication as a New Investor
by Christopher Levarek
“All life is an experiment. The more experiments you make the better.”
- Ralph Waldo Emerson
Investing into real estate syndications can seem daunting and intimidating when you are starting out. I actually also felt this same way when I began to look into investing in a property I had never seen or in an deal I did not fully control.
I had fears about how to get my money back out of the deal and the actual visibility of the inner workings of the property renovations or management.
However, these fears were soon addressed by learning more on the subject and doing some research on the topic. With every article or book or podcast I read or listened on the topic, my confidence grew and the opportunities I discovered no longer seemed so intimidating.
With an understanding of the topic, my vision or why of what I was looking for became more and more clear. This in turn increased my confidence and in turn my success.
This is why I often recommend education as one of the best places to start for those considering their first syndication. Gaining some education on the subject, reviewing completed or previous deals, connecting with like-minded investors and creating clarity on the vision, are some great ways to increase success when getting started.
Self-education
You don’t know what you don’t know. Learning more on real estate syndication to build investing confidence can most easily be done by reading/listening to the many podcasts, books and online resources on real estate. Here are some we recommend to start with:
Podcasts :
The Real Estate Syndication Show
Books :
Rich Dad, Poor Dad by Robert Kiyosaki
The Hands-Off Investor by Brian Burke
Connect with Like-Minded Investors
There are many online forums, meetups and Facebook groups which all connect like-minded investors like you. Joining such platforms can allow you to ask questions and gain clarity. Even if you decide to simple look at the thousands of questions and answers on a forum such as BiggerPockets, your confidence and knowledge will grow.
Sharing questions and fears as well as excitement for ambitious goals can be a great way to get moving in the right direction. Listen to experienced investors as they discuss things they wished they had known or investing experiences with certain sponsors or groups.
Here are some groups or meetups we recommend connecting with :
Review Deals
Take your time to see how deals are presented from various syndication groups. Join sponsor or group investor lists with the intent of reviewing the deals to be come familiar with the words, financial projections and documents.
As you review more offering memorandums and investment summaries, you will gain clarity on how each group operates and your understanding of what investments you like will grow.
Perhaps, set a goal to see 5 investment summaries or attend 5 presentations before agreeing on one.
Clarity on your Vision
With all the knowledge and gathered information, revisit your reason for investing into a real estate syndication. What is your why? What drives this action?
Now which investments aligned most with that vision or why? Which groups resonated or did you find alignment of values, character or interests?
Defining your why or getting clear on your investment goals will make it that much easier to select or partner on any deal.
In Final
Remember it’s normal to feel anxious and unsure when being part of your first syndication. Enjoy this moment, take your time and know that your first real estate syndication deal is a big step in your investment journey.
However, it is a milestone filled with excitement, reward and mystery moving you further closer to your desired future.