Let’s define our next key term: “real estate syndication.”
The easiest way to explain this is to connect it to something more familiar: a stock.
The value of a stock rises and falls with the performance of the company. They sell more widgets, your fractional ownership goes up; sales go in the other direction, and then so does the value of your ownership.
Real estate syndication is similar in almost all respects, except in this: the value of your share is almost guaranteed to grow.
How does real estate investing do this?
The investments are placed in real estate. Real estate and the investment properties that appear in syndication funds reliably increase and appreciate in value year after year.
Let’s talk about another major difference: capital requirements. Stocks can be priced at any level, but to join a real estate syndication group investors must have typically around $25,000 to $50,000 in cash upfront. This is a lot of extra cash, but if you’ve got the down payment there are not many other investment types that are as attractive as real estate investment funds (REIT).