Real Estate Syndications with Goodegg Investments' Annie Dickerson
Would you like to invest in real estate and build lasting family wealth? Would you like to see your money work for you as a faithful servant? Certainly, everybody believes in the time-honored strategies of putting money away in a savings account, investing in mutual funds, and trying their hand at playing the stock market. Yet, there is a unique breed of humans who know there's much more profit elsewhere. These are the kind of people that Goodegg Investments are working hard to raise and help make real wealth.
What Does a Real Estate Investor Want?
Annie Dickerson's Goodegg Investments company makes passive investing work for busy families. The primary vehicle is real estate, but not real estate investing, as you probably know it. The company shows you how to invest passively in real estate syndications or group investments while reaping these crucial benefits of a typical real estate investment:
The cool thing is you don't need to become a traditional full-time landlord to make real estate work for you. That's what Chief Creative Officer Annie Dickerson and her team work so hard to sell to busy moms and families.
The idea of real estate syndications is an attractive option for young families who have their hands here and there in a quest for the golden goose. It's an immersive process to think about finances and growing wealth. With Goodegg, you have ample time to travel, vacation with the kids, and have substantial passive income that can help you consider other lucrative investments.
How Goodegg Delivers
Goodegg's portfolio currently stands at more than 8,000 units, and Ann's experience spans more than ten years, so she knows the business too well. Real estate syndications go beyond the traditional process of purchasing a rental property, finding tenants, and taking rent. Instead, they involve pooling resources with other investors and purchasing a much bigger property with better commercial prospects.
One good thing about real estate syndication is that everyone does not have to pony up the same amount of money. There might be several dozen people investing in the pool, sometimes hundreds even. The goal is to purchase a bigger property that offers more economies of scale. How so? Let's say you own twenty single-family homes. At some point, it may be necessary to do roof work on each of those. A single roof may be 20 or 200 units to handle. A single apartment building will certainly be a better investment than one house at a time.
Multitenant apartments offer rates of return that depend on the specifics of the deal. Goodegg helps clients stay assured of a 7 – 8 percent cash on cash return per year. Let's say that you invest $100,000, for instance, over the company's standard five-year hold time. The minimum investment with Goodegg is $50,000. There'll be renovations and a drive to raise the rent during that time, all to push up the property's value and improve the community.
During these five years, you'll be getting monthly or quarterly cash flow distributions of 7 – 8 percent per year (around $667 per month). When the five-year period elapses, you have helped to increase the overall quality of the community. That's where the sweet part of the deal comes into play. Since it's a commercial building investment, and there's been plenty of work to improve the building and environment, the time comes to cash in on that too. Single-family homes don't have such a prospect. Their value is mostly dependent on the perception of neighbors. Goodegg sells the apartment building, and you can recoup anywhere between 40 and 60 percent of your original investment.
In a nutshell, on a $100,000 investment, you make $40,000 over five years ($8,000 per year). After five years, you make another $60,000 – essentially doubling your money. Goodegg doesn't just stop at the unbelievable and insane 8 percent per year. The fantastic accent that comes after five years is definitely fitting icing for the cake. The company knows this can encourage long-term investors to use that to refresh the deal: turbocharging.
Another point that resonates with Ann's clients is that someone takes all the hard work off their hands. It's the most valid definition of passive investing and earning a passive income – the system does the heavy lifting of managing the renovations. Goodegg maintains a dedicated team of professionals that ensures all work happens as and when due. Ms. Dickerson compares it with wholesale fixing and flipping, considering the hundreds of units involved. The equity in the property quickly ramps up, and the company does everything to ensure it becomes free again as soon as possible.
Key Factors in Property Development
Goodegg's strategy is to ensure that two key elements are present concerning investments: the market and the team. It explains why, in putting investors' interests first, most of the company's properties are in Texas, the Southeast, and Orlando. Orlando is a budding market owing to an abundance of jobs and growing migration. Population explosion is a critical factor in real estate development.
Job diversity is also important. It's another thing Orlando shines at; the ability to not rely on a single industry. The balance is attractive for long-term real estate development. So, even if Disney World shuts down and drags the entire tourism industry along with it, there's enough traction in other industries to fill the gaps. Tech consulting, for instance, has proven to be steadily on the rise in recent years.
Once the environment supports the mission, Ann says Goodegg looks for the right management team, including property and asset managers and operators, to be hands-on with the renovations.
Goodegg's Tax Strategy
Since new investors mostly focus on returns, they often ignore the tax components of their portfolio. They can borrow a leaf from those with more experience who invest for three significant reasons: cash flow, appreciation, and tax advantages. Investing in commercial offers accelerated depreciation and cost segregation
Ann explains that depreciation on a single-family home covers twenty-seven and one-half years. That's the schedule to depreciate the entire property by the same amount every year. On a commercial property, the investor gets forty years. Now, holding a property for five years means there are thirty-five years of depreciation on the table. That's where accelerated depreciation comes in. it's an essential component of cost segregation. Goodegg helps investors make sense of all that, bank reasonable sums of money, and enjoy sizeable tax breaks.
Goodegg relates with investors on their level. As CFO, Ann ensures investors understand the benefits they stand to get and what actually works for their situation. Entrepreneurs everywhere can learn a thing or two from Goodegg Investment's client strategy.
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