Webinar with Rise48
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Episode Description
Welcome to the Freedom Point Real Estate podcast! In today's episode, Jeremy Dyer meets with Zach Haptonstall for a webinar call covering what passive syndication investing involves, what Starting Point Capital and Rise 48 have learned over the years, why the track record of a potential sponsor matters, and more.
Rise48 Equity provides multifamily investment opportunities for both accredited and non-accredited investors, focusing on Phoenix and Dallas due to their strong growth metrics. The team invests personally in each property, using market research and partnerships to add value and create passive income through cash flow and profits from sales. With experienced, locally-based teams and vertically integrated management, they are well-positioned to execute their business plans.
Want to learn more about Rise48? Visit https://rise48equity.com/
CONNECT WITH JEREMY DYER!
Website: https://startingpointcapital.com/
Instagram: https://www.instagram.com/startingpointcapital/
LinkedIn: https://www.linkedin.com/in/jeremydyer
Facebook: https://www.facebook.com/startingpointcapital
Book a Call! https://calendly.com/startingpointcapital/discuss-investing-with-jeremy-dyer?month=2023-12
Summary
Tip #1: Understanding Investment Structure
"The investor has what's called a 7% preferred return... before the sponsor Starting Point Capital makes any compensation." Understanding the preferred return ensures investors prioritize capital protection and steady income. This structure safeguards against market volatility, providing stability and predictable cash flows.
Tip #2: Benefits of Value-Add Deals
"These value-add Deals... they don't start out at 7% in year one because we're renovating units and increasing the rent." Investing in value-add properties offers potential for increased cash flow as renovations enhance property value. It's a strategy balancing initial lower returns with significant upside potential through proactive management.
Tip #3: Market Selection Criteria
"We're looking for population growth... job growth, diversified job growth." Choosing markets with robust population and job growth ensures sustained demand for rental properties. Diversified economies mitigate risks associated with industry-specific downturns, fostering long-term stability and rental income growth.
Tip #4: Criteria for Tenant Demographics
"We require that all of our tenants are making at least two and a half to 3x the income of what the monthly rent is." Ensuring tenants' income exceeds rent requirements minimizes risk of default and enhances property cash flow. This criterion supports sustainable occupancy rates and financial health of the investment.
Tip #5: Importance of Landlord-Friendly States
"We have to be in landlord-friendly states where we can evict people... and non-renew leases efficiently." Investing in states with favorable landlord laws facilitates efficient property management and reduces financial risks associated with tenant disputes or non-payment. Clear eviction processes protect investor returns and operational continuity.
Tip #6: Predictable Property Tax and Insurance Costs
"Charlotte is located in Mecklenburg County... Property taxes are determined by the county and reassessed once every four years." Predictable property tax and insurance costs in stable markets like Charlotte optimize financial planning and budgeting. This stability enhances investment predictability and reduces operational uncertainties.
Tip #7: Utilizing Self-Directed IRAs and 401(k)s
"We certainly have a good demographic of investors that are choosing to use IRA money through a self-directed IRA strategy." Utilizing self-directed retirement accounts for real estate investments offers tax advantages and diversification beyond traditional stocks and bonds. It empowers investors to align their retirement goals with passive income strategies.
Tip #8: Maximizing Depreciation Benefits
"2024 Investments typically will produce... 40 to 60% passive paper loss depreciation in year one." Leveraging depreciation benefits optimizes tax efficiency for passive investors, potentially offsetting other taxable income. Understanding depreciation rules and strategies enhances overall investment returns and long-term financial planning.
Tip #9: Evaluating Market Expansion Opportunities
"We recently opened up an office in Charlotte, North Carolina, due to its competitive market dynamics and growth potential." Expanding into new markets requires thorough analysis of economic fundamentals and growth projections. Strategic market expansion aligns with investment goals, diversifies portfolios, and capitalizes on emerging opportunities.
Tip #10: Reinvesting Cash Flow for Wealth Growth
"We receive well in excess of six figures a year in monthly distributions... we're just redeploying that capital into other opportunities." Reinvesting cash flow compounds wealth growth by leveraging passive income to fund new investments. This strategy accelerates portfolio expansion and enhances long-term financial security through diversified income streams.
