Non-Accredited Investing: How to Invest in Real Estate Without Being an Accredited Investor
Wednesday, September 13, 2023
If you've dreamed of investing in real estate but felt held back by the accredited investor requirement, we have some great news for you – you don't have to be accredited to invest! Non-accredited investing is a legal and accessible way for folks of all income levels to get in on private real estate deals without needing a high net worth or high income. In this article, we'll dive into the world of non-accredited real estate investments, giving you all the information you need to get started. So grab a seat and let's get started!
1. Learn About the Different Types of Non-Accredited Real Estate Investments
The most common types of non-accredited real estate investments are through 506(b) syndications, crowdfunding, and real estate investment trusts (REITs). Each option has its unique benefits and risks, so it's essential to research and understand which one would be the best fit for you.
- Syndication is basically group investing: This model allows investors to pool their money with other investors to purchase a bigger asset, such as an apartment complex or shopping center.
- Crowdfunding websites: provide platforms for individual investors to invest in real estate deals with low minimum investments. Assets can include single-family homes, multifamily properties, office buildings, etc.
- REIT's: REITs are publicly traded investment vehicles that own income-generating real estate assets, such as residential apartments, shopping malls, and commercial offices.
2. Evaluate the Risks and Potential Returns As With any Investment
Non-accredited real estate investing comes with risks, and it's essential to evaluate them and seek the advice of your CPA, Attorney or Financial Advisor before putting your money into this type of investment vehicle. The most significant risks include market risks and liquidity of the investment, as well as the potential of fraud. On the other hand, non-accredited real estate investing could provide significant returns, such as strong cash flow, appreciation, and tax benefits. It's crucial to conduct due diligence and analyze the projected returns and risks of potential investments before committing your funds.
3. Find a Reputable Real Estate Investment Sponsor
Find a Reputable Real Estate Investment Sponsor To invest in a non-accredited real estate opportunity, you'll need to find a reputable real estate investment sponsor, such as a syndicator who is sponsoring an offering or join a crowdfunding platform. Start by researching credible websites, attend local real estate investment meetups, and network with seasoned real estate investors to find trustworthy sponsors. Good investment sponsors usually have a track record of successful projects, are transparent about their investment strategy, and have open communication with investors.
4. Know the Securities Laws and Regulations
Know the Securities Laws and Regulations Although non-accredited real estate investing is legal, there are still securities laws and regulations that investors must comply with. The SEC's Regulation D under the Securities Act of 1933 governs private securities offerings, including real estate investments. As a non-accredited investor, you will have to sign a subscription agreement, which specifies the securities laws and any restrictions on transferring or selling your investment shares. It's essential to understand the securities laws and regulations and seek the advice of your CPA, Attorney or Financial Advisor before investing.
5. Diversify Your Non-Accredited Real Estate Portfolio
Diversify Your Non-Accredited Real Estate Portfolio Diversification is critical to any investment strategy, including non-accredited real estate. Instead of investing all your funds in one deal, consider spreading your investments across different sponsors, property types, and metropolitan statistical areas (aka MSAs). This way, you'll lower your investment risk and gain exposure to different real estate markets and investment strategies.
If you are interested in learning more about how to start investing in real estate, without becoming a landlord yourself, contact us or set up a brief meeting with our President, Ed Mathews using the calender here. We're at your service.
Find Us On Social Media
Clark St Capital helps C-Level executives to build passive income through our conservative, high-yielding real estate projects and our private equity funds.
Contact Us
415 Killingworth Rd
Suite 8
Higganum, CT 06441
Office: +1 860.675.5800
Resident Support: +1 415.417.1656
Academy Support: +1 860.675.5800
Acquisitions Team: +1 860.375.9060
Copyright 2024 | Clark St Capital LLC | All Rights Reserved
Privacy Policy | Terms Of Use | Risk Factors
No Offer of Securities—Disclosure of Interests. Under no circumstances should any material at this site be used or considered as an offer to sell or a solicitation of any offer to buy an interest in any investment. Any such offer or solicitation will be made only by means of the Confidential Private Offering Memorandum relating to the particular investment. Access to information about the investments are limited to investors who either qualify as accredited investors within the meaning of the Securities Act of 1933, as amended, or those investors who generally are sophisticated in financial matters, such that they are capable of evaluating the merits and risks of prospective investments.