Rental Property Investor from Jacksonville, FLPREVIOUS POSTWhy I sold Cleveland.If you're a real estate podcast junkie like me, you definitely have noticed the clear shift towards real estate syndication in the multi-family space over the last couple of years especially.As deals became harder to find in single family and smaller multis across much of the desirable markets,the allure of pooling investor funds to acquire larger assets became a sort of self-fulfilling prophecy.Books that were mostly hurriedly written flooded the market pimping the upsides of this strategy.The argument for was simple and convincing:it is better to own 1% of a large deal than 0% of no deal.Personally,I could not help but notice that the popularity of the idea coincided with the rise of real estate crowdfunding.The likes of Realty Shares and Realty Mogul raised a bajillion dollars practically overnight making it very easy for everyday real estate aficionados to own small bites of a mega deal in rural Tennessee at the click of a mouse.A few of my friends experimented with the crowd-funding route, tossing $5000 into this debt offer and $10,000 into that equity offering.These punts yielded mixed results anecdotally, as an equal number seemed to have great experiences to share as did absolute nightmares.To be fair, no real estate niche is 100% fail-safe or iron clad.Money has been lost in a large single family portfolio as well as a personally purchased medium sized apartment complex.It is also certainly true that in the end, every investor will run out of money to invest in more properties if they decide to go it alone trying to rapidly scale up their portfolio, and real estate is most assuredly a team sport at all levels.

There's absolutely some nuances if the property was acquired in 2024 but not placed in service until 2025, so please keep this in mind. 

I have absolutely nothing to sell and would be happy to help if you think that I can be a resource.

That’s why you overestimate rehab and underestimate ARV—because, God forbid something happens, you can absorb that loss.To combat the three issues above, you have to do the following:Buy as low as you can.

I absolutely recommend immediately using a note servicing company.

BUT The points they charge and interest are both way higher than normal, on some deals I ran numbers the points and interest were going to be 20k on properties where the ARV is 100k so you have to get properties at such a low price to make it work that it is so hard.

So having an equity cushion is more beneficial.You can absolutely do io and be fine but I'd be banking those cash reserves in case you need that down the line for a cash-in refinance, accidents at the property, or to shore up personal finances.

Great strategy idea, and yes, this can absolutely work, but it takes careful planning.From a tax perspective, consolidating through a 1031 exchange is fully allowed as long as the exchange stays like-kind (investment property for investment property).

You’re absolutely right, skipping the protest is like leaving money on the table every year.

If the answer is not obvious, remember the relationship between appreciation and rent growth so the answer is the same for both questionsI have made a lot of money via brrrr and simply would not chose that strategy in a low cost market.