I have been actively buying and selling properties for the past couple of years here in California full time under the following scenario:
1. I do all the market research
2. I find and negotiate all the properties
3. I open and follow each escrow
4. I close each escrow
5. I then put the property back on the market
6. I find a buyer for the property
7. I open and follow the sale escrow
8. I close the sale escrow and deal with any problems.
I do all the work; the investor puts up 100% of the money.
Once the property has been bought and successfully closed, we deduct all the costs of the transaction and the net profits are split 50/50
I would like to set up a small investment group or REIT (whichever is simpler) where investors can put their money into the “group or REIT” and be guaranteed a certain return on their investment, but without actually going on “title” or having a lot of control or input into the deals.
I am in California and so far all the properties we have done have been in California.
I want to keep this as simple and uncomplicated as possible, while at the same time offering the investor a high degree of protection on their investments.
Please let me know your thoughts and where you might direct me for some legal and financial help.
I would just do a simple partnership. Filing with the SEC and starting a REIT ain’t cheap. You can also form a LLC which is very popular today. You want to be able to limit the investors liability to their investment.
I am considering the same scanerio in North and South Carolina. The research I have done so far suggests using private placement money to form A partnership of some description to escape REIT requirements which are complex. Any suggestions from the group would be a plus.
I like to subscribe to the KISS principle- Keep It Simple Stupid! A REIT WAY overcomplicates things. Like others have suggested, just set up a partnership…
I myself am located in California. I am based out of Los Angeles and work with consulting and larger apartment complexes. We are registered with the State as a LLC.
Contact the State, the fee is $70.00
Also check, you may need to file for a FBN. That fee is $23.00
Don’t hesitate to contact me if you need help or have any questions.