well hey there! this is seth from the retipster blog and today i wanted to show you about this interesting website i discovered a few months ago and it’s called "realtyshares"and the reason i want to tell you about this is because i get emails every sooften from readers who – they don’t necessarily come out and say it thisbluntly but… basically what their issue is, is they’ve already done fairly wellfinancially, they have a good nest egg or a pretty good income and the idea ofinvesting in real estate sounds really appealing, not only is a way to diversify but also to earn a better return ontheir investment and maybe even develop
some kind of streams of passive income,but the problem is – these people really have no experience, no real, practicalknow-how when it comes to finding deals, financing them the right way, gettingproper management, doing rehabs, all this stuff… there is a ton of skill andjust industry knowledge that is baked into those things if you want to do itand succeed at it. for those of you who are out thererunning real estate investing businesses whether it’s house flipping or rentalproperties or land flipping like i do… all of those things inherently requirea lot of knowledge and experience in order to do it without losing your shirtand really hurting yourself.
so if somebody doesn’t really have theexperience or even really the desire to learn how to do all that stuff and tobuild a new business and everything that comes along with that, i think this siteright here – realtyshares could be a really good option just in terms ofmaking it very easy for people to invest smaller chunks of money in actual realestate investments. and again, i’m still getting acquainted with it but from whati’ve seen of this site, it seems pretty legit. i actually just signed up for an account afew days ago and i’ve been looking at some of their investments and the waythis site works is – there’s a team of underwriters who looks at a lot ofdifferent real estate projects across
the country and they only accept about2% of those projects and then of the projects that get approved andbasically meet all the standards required to make up what they considerto be a good real estate investment (one that has a pretty reasonable likelihood of succeeding), they put them on here and essentiallyyou can invest your money in increments of $5,000 or higher and in some cases you can eveninvest less than that, depending on the type of deal you want to invest in. as iwas looking through the site, it almost reminded me of a micro lendingplatform, where you can just invest
smaller amounts of money without puttingup all the funds for the entire loan just kind of play a smaller part in that -and then in time, that loan gets paid back, you get your investment back and thenyou can reinvest it. the difference is that this particular site is gearedspecifically towards real estate investing and the types of these you caninvest in are "debt deals", "preferred equity deals" and "joint venture equitydeals" – and the difference between those are with like a debt deals and preferredequity deals you’re investing ina loan, so the funds that you put into the project are lent out to another realestate investor who buys a property,
rehabs it, flips it or does somekind of improvement and then sells it for a higher amount and then you get paidinterest during the term of that loan and when it’s all paid off, you get allyour money back and you can then reinvest it (and that’s assuming everything goesaccording to plan). whereas with a joint venture deal, you are actuallyowning a portion of that property. realtyshares shares will create a new,unique llc for that property and then buy it and then you have an ownership inthat llc through the investment of the property and depending on whether youwant to invest your money and get it
back really quick (like, within a year) or whether you want to just invest in parkit and then get a higher return over that period and then get it back afterlike, 5 years there are different pros and cons thatcome with the type of investment you want to do and what your long-term goalsare. but anyway, what i want to do in this video is just give you a quick lookat what realtyshares is all about, show you what their website lookslike, how you can find deals and invest in them and – i’m not going to say this is the perfect fit for everybody because it’s not. you actually have to bean accredited investor to even be
allowed into this and to start seeingthe deals and investing – which basically means, you either have to have a really good income or a nest egg saved up and then you can get into this site and start investing. so i’m going to justshow you how this all works – what you’re looking at right here is the home pageand it’s fairly easy to sign up for an account, all you have to do is just enterin your email address and password so i’ll go ahead and do that right here. nowkeep in mind, when you’re creating your password you actually have to use anuppercase and lowercase character so just do that or it’s not gonna let youthrough and you just click the sign up
button and then it’s going to show you apage like this and this is basically asking whether you want to be somebodywho is getting money to finance your own project or whether you want to investmoney – and for the purpose of this tutorial, i’m showing you how you caninvest if you want to put your money into a project. now right here, you just put in all your information and click continueand then this is where it starts to get a little bit more specific about who canbe involved and become an accredited investor with the site. basically you eitherhave to be an individual with an income of more than $200k per year for thepast 2 years, or have a net worth
exceeding a million dollars excludingyour primary residence, or if you have a joint income with your spouse exceeding300k for the past two years that would also qualify you or if you invest onbehalf of a business entity with at least five million in assets or businessin which all equity owners are accredited investors so basically you can’t really get pastthis point unless one of these things applies to you. i’m gonna go ahead and click on this oneright here to start this off you can go ahead and add your bank account, sobasically it would draw your investment
funds directly from that or you can justadd it later and skip this part for now then it’s going to ask you to verify youremail address – i’ll go ahead and do that quick. when you go and check your email it’s going to look something like this. let’s go ahead and click that – and thensomething you’ll see right off the bat is – the sec typically advises thatinvestment companies like realtyshares wait a period of 30 days before theylet the investors start investing, so they called us the "cooling off period".however, another thing you can do if you want to bypass this is to go ahead andfill out the "suitability questionnaire" and this is something you have to fill outeither way before you proceed
so it’s something you might as well justgo ahead and do if you want to get started. if you want you can also check out thisvideo if you need more information and near the bottom it shows someexamples of past investments, just so you can getan idea for what those look like. so anyway, let’s go back up here – i’mgonna start filling out the suitability questionnaire and give you an idea for what that looks like. in this case, if you’ve got your own llcor trust and you gonna be investing through that, you could signify that here. in this case, i’m just going to say no, i’ll just be doing this personally.
i’ll go ahead and put today’s date inhere and click submit and at this point we’ll just have to wait for therepresentative from realtyshares to contact us and verify anything else theyneed to know before we can move forward. so i’m going to wait for that and oncei’ve been allowed in to see the investment opportunities i’ll pick this back up and we can take alook at that and just give you an idea for what that looks like. okay i’m back – it’s been about 24 hours. i actuallyended up getting a call from the representative at realtyshares a fewhours after i completed my questionnaire
so it was really pretty quick processand the conversation we had was informing me of the risks and makingsure i understood how everything worked. it was really a pretty easy conversationand they went ahead and approved my account and let me start browsingopportunities so – i just logged in here we can either go up here and click "exploreinvestment" or we can go over here and just click this orange button. the waythis works (as the guy explained it to me on the phone) is any deals that werealready out there on the open market prior to me getting approved – i can’t getaccess to those, so it looks like there’s currently 5 open investments and allof those investments were already out
there and no new ones have come onlinesince i got approved (like, an hour ago) so normally what you’re going to see here (and by the way, you’ll notice a lot ofthe stuff is blurred out that’s because i can’t show it for confidentiality reasons, buthopefully this will just sort of give you a vague idea of what the informationlooks like and how its laid out) but basically there are these buttons downhere that say "unavailable". if those were newer ones that had just come out,instead they would be a big orange button that would allow me to click on itand start investing money. there is some information here regarding the returnpercentage, the minimum investment required,
the approximate location where theproperty is located, how much has been raised to date and how much more they still need. if we scroll down here we can see some other ones. as you can see, there’s just some different types of properties – we’ve got a retail buildinghere, we’ve got a residential opportunity right here, it looks like a bunch ofapartment buildings maybe. this one here is a single family house. if we go up here, we’ve got amulti-family here at the top single-family and multi-family… so youcan kind of get the idea. there’s different types of properties anddifferent "minimums" in terms of how much
you have to invest in order to get yourfoot in the door on these deals. i’m going to click on this one just tosee the investment details and as you can see, there’s just a nice investmentsummary. we can click on some photos to see more details on that. just get an idea for what theseproperties look like… we can scroll down here, you can see the target holding period,minimum investment, target irr, we’ve got a nice investment summary and click and seefinancial information, click on the property, just see a summary of theproperty, some details of how many units it is and where it’s located
when it was built, what they’re planningto do with the acquisition and maybe even the rehab of this property if thatkind of thing is involved. market summary just so you can kind of get some ideasfor what the statistics are in the demographics of the area, management ofthe properties (who is going to be managing it all the way down to theindividual principles who will be on the management team) and then the documents tab – it looks like we’ve got a track record, comparables analysis, investor package,financial summary so we can download this stuff and justget a better look at what everything is going to look like
take a look at the track record see whatthat’s like – again i have to blur all this stuff out because i can’t just showthis to the public unless you’re an accredited investor, but i can just tellyou from my nearly 10 years i spent in the commercial banking world this is like, all the same stuffthat bankers and underwriters look at when they’re deciding whether or not tolend money on a property. this is very standard – what youwould expect to see a big commercial bank looking at before jumping into anydeal – so these guys seem to be the real deal and just from what i can see here,they seem like they’re looking at all
the right stuff and analyzing the dealappropriately and developing a good understanding of what each projectentails before they invest anybody’s money in it. in terms of whether i’mgoing to be investing my own personal funds in any of these, i honestly don’t know yet. i’m certainly open to it, but i’ve got a number of projects on the tablethat i’m looking at this year so i may or may not, but if i do,i’ll certainly do a follow up video or blog post and just let you guys know howit’s going, what the experience was like, how the process went and if it’s earning the way that these guyswere expecting it to earn. and for that
matter, if you end up signing up for thissite and becoming an accredited investor by all means, be sure to leave a commentbelow and let us know how it’s going. let us know what the experience was like, how your investments doing – i’d just be curious to know from everybodyelse out there how it went and what the experience was like. if we go back to ourdashboard again there’s not anything here becausei haven’t invested in anything yet but if i had, i could go ahead and click onthese tabs and see a summary of my investments, take a look at a graph showing myearnings just so i could track where things were at and how they’re going. i cansee statements (probably for tax purposes)
and that kind of thing… we can go to the tax center, bank accounts -again i have not added my bank account yet but that’s pretty straightforwardand easy to do – and really that’s all there is to it. as you can see – as time goes on,these investments will turn over and old ones will go away and newones will come online and you can take a look at them as time goes on.i think there’s many different kinds of players who are on this site. there areprobably people who have millions and are constantly putting money in andgetting the money back and there’s
probably people who just put in $5,000 at a time and just kind of wait for it to see what happens. when iwas talking to the folks at realtyshares i was told that there’s somewherearound 20,000 accredited investors on this site right now, so it’s not really atiny operation. there’s a lot of people who are involved with this, and theaverage investment size per investor is somewhere around $12,000and i guess the average number of investors involved in each project issomewhere around 55 – so that just gives you an idea of howthat all works and the typical investor and project size and how many people areinvolved.
that’s really all there isto it. again, i’m not saying this is the perfect fit for everybody, i thinkthere’s certainly people who would be better off running their own businessand finding their own deals and kind of handling it all themselves. some realestate deals can be extremely profitable and if you are willing tohandle it all in-house, you can take all of that profit… whereas this is more forthe investor who wants to kind of sit back and not do all the hands-on workbut just put their money in and let it work for them. the returns may not necessarily be asbig and they certainly won’t
have the kind of control that they wouldif they were buying a property and managing everything themselves, butthat’s kind of just the trade-off that comes with whether you’re looking for ahands-on investment or hands-off investment. so hopefully this video gives you agood idea for what realtyshares is all about and how the site works and i thinkit’s certainly not a bad option especially if you’re somebody whodoesn’t have the experience or knowledge or even the desire to figure out how torun your own real estate investing business, this could be the next best bet if youreally want to be involved with real estate investing on some level.
just so you know i do have anaffiliate relationship with these guys, i don’t want that to sway your opinion onanything but i just want to be upfront and let you know i will get a smallcommission if you decide to sign up through the link beneath this video. also keep mind, if you end up signing up you can also refer people to the site toand get paid for it… so it’s not a bad deal if this is something you want tojump into with both feet, there can be some nice money-makingopportunities from a few different angles. if you’re interested besure to check it out to the link below, as always i appreciate your support morethan you know,
and whatever you decide to do, i wish you all the best on your next real estate deal.