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What Is A Property Syndicate, And Why Is It A Good Investment?

A property syndicate is a pool of investors who combine resources to invest in properties as a group. There are substantial advantages to joining a syndicate, particularly for those who want passive participation in the investment process.

A Property Syndicate Allows You To Have A Headache Free Investment

By entering a syndicate managed by an experienced company with a proven track record, you can make a sound investment with the minimal ongoing effort required. This is particularly useful if you are new to the market or looking to diversify your portfolio with a passive investment, managed by experts. The key here is to ensure you work with an established and reputable syndicate, with a track record of integrity and success.

Investing In A Syndicate Saves You Time

Real estate is a complex business that requires research, legal documentation, return forecasting, a strategic understanding of the market, and legwork. All of which is crucial to ensuring you are making the right investment to get the required returns. For those outside the property business, the task is laborious, and the pitfalls are many. A syndicate eliminates these issues and allows you to passively invest without having to do the heavy lifting.

Passive Investment With A Syndicate Is A Smart Way To Diversify Your Portfolio

Diversity is one of the keys to protecting your investments and safeguarding your future. Syndicate investment is an easy way to diversify your portfolio into the residential property market without the need for you to have in-depth knowledge or expertise in the field. All markets fluctuate and the more diverse your portfolio, the more protection you have from the negative effects.

A Syndicate Allows Access To Higher Value Properties

By combining investors, you gain access to higher valued properties with a lower upfront capital investment. To invest in highly valued properties as a sole investor, the risk to you is high and the returns potentially too slow to make the investment a sound one. As an investor in a syndicate however, you invest less which decreases your risk, and as a passive investor, time on return will not be a pressing factor. You are taking advantage of low-risk to give you long term returns.

What To Look For In A Property Syndicate

The syndicate you choose must have a proven track record of profitable investments and a stable pool of investors. The company that manages the syndicate needs to display:

  • A sound understanding of town planning and any constraints placed on the market
  • Continual sourcing of information and new opportunities
  • Ongoing evaluations of social and economic issues of given areas
  • An established investment reputation in the area
  • Transparency regarding current investments and their ongoing progress
  • Appropriate numbers, 4-10 investors is a typical number
  • Testimonials from satisfied investors, and take note of repeat investors

If you would like to know more about Property Syndicates, contact the team at Black Bear today.