For the past 7 years or so I have really wanted to start a real estate investment trust (
REIT).
My preference leans towards microfunding instead of traditional bank loans. Unfortunately to buy rental real estate in the US you either need to buy low performing properties (Tenant occupied, or pre-rehabbed ones) or cash. So, the options are either microfund or do hard money. I have preference to microfunding instead of hard money due to the fact that I can potentially raise significantly more capital and have lower funding costs overall.
The neat thing about cash purchases of real estate is that you usually get significant discounts as compared to financed deals.
Additionally you can refinance the property after rehab and occupancy to continue to buy more and more properties thus producing exponential gains over time.
Here are the benefits to such a venture project -
- Lower risk as compared to equities and other forms of traditional investment
- Perceived exponential gains over the course of several years
- Could benefit BTC with more legitimacy as it would likely become a extremely profitable company rather quick, funded by bitcoins. Additionally the REIT could provide discounts/benefits to tenants if they pay in BTC over USD
Risks of venture -
- Exposure to fiat
- Exposure to US Economy
- Trust
Of all of the risks the trust issue hopefully is the easiest one to clear up as I'm already successful with rentals and have been in real estate for a while.
So, i'm looking for feedback on this idea. I'm going to go through with it whether I can get listed on a bitcoin exchange or not (I can always drum up traditional investors) but microfunding it seems to be much more appealing to me.
