Real Estate Syndication 101: What to Know Before You Invest

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NerdWallet's Smart Money Podcast 29 min 3 speakers 7 chapters transcribed 20 hours ago
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Sean Pyles 0:00
Today's episode is brought to you by Vinted.
Elizabeth Ayoola 0:02
Sean, do you have clothes in your trunk that you've worn but have no idea what to do with?
Sean Pyles 0:07
You know what? I do not because my car is super clean right now. But I'm betting that you do, Elizabeth.
Elizabeth Ayoola 0:13
I sure do, Sean, unfortunately. And I've been wondering what to do with these clothes. And then I found out about Vinted. So they're like this secondhand marketplace app and their mission is to make secondhand your first choice.
Sean Pyles 0:26
Yeah, Vintage helps their members find great deals and easily sell the clothes they no longer wear. And that helps give quality items a second life again and again.
Elizabeth Ayoola 0:35
And it helps the planet too. And we care about the planet, don't we, Sean?
Sean Pyles 0:38
We do. Well, Elizabeth, whether you're clearing out a bag of clothes in your trunk that's been sitting there for months and months, or you just have pieces in your closet you don't want anymore, vintage makes it super simple to refresh your wardrobe, earn extra cash, and give your clothes a second life. Plus, there are no seller fees, so you keep what you earn from every sale.
Elizabeth Ayoola 0:56
And also the app is free to download. I think that's a great perk.
Sean Pyles 1:00
Vinted makes listing items quick and simple. And once an item sells, Vinted creates a prepaid shipping label for you, which takes out a lot of the burden of sending your items.
Elizabeth Ayoola 1:08
See what's hiding in your closet or like me, your trunk. And you might be surprised how much you can earn with vintage. Download the Vinted app for free to start listing with absolutely no seller fees.
Sean Pyles 1:19
Hey, smart money listener, you could win a $250 Amazon gift card and help improve our show.
Elizabeth Ayoola 1:24
We're inviting you to take our annual listener survey. It's shorter than last year's and could bag you a sweet grand prize. We're giving away not one, but two $250 Amazon gift cards.
Sean Pyles 1:35
To participate, just visit nerdwallet.com slash podsurvey or check out the link in the show notes and submit the form by September 30th for a chance to win. Official rules are at nerdwallet.com slash podsurvey. Good luck.
Elizabeth Ayoola 1:46
Katie wants to diversify into real estate and is considering real estate syndication. Today we break down what it is, what it costs, and also what's at stake.
Sean Pyles 1:59
Welcome to NerdWallet's Smart Money Podcast, where you send us your money questions and we answer them with the help of our genius nerds. I'm Sean Piles.
Elizabeth Ayoola 2:06
I was gonna serenade myself, but I won't. And I'm Elizabeth Ayola. This episode, we're talking about something that we have not touched on in some time, and that is real estate investing. Thanks to you, Katie. Hopefully, you're listening and watching. They want us to weigh in on the pros and cons. So here is their question. I hear I should think about diversifying my investments into real estate. I don't need to learn another profession, so I don't want to manage rental houses. or STR short-term rental. Can you tell me about getting into real estate syndication? Pros and cons. Minimum investment for most places. Questions I should ask as I talk to its sponsor. How long will the capital be tied up? As well as everything I don't know.
Elizabeth Ayoola 2:47
Thanks. Katie.
Sean Pyles 2:48
Well, Katie, we can't teach you everything that you don't know because that is a long list that extends well beyond real estate investing. But we'll give you some tips today. And we're joined by NerdWallet investing writer Sam Taub to help out. Sam, welcome back to Smart Money. Long time no sake. Sam, let's start by outlining what real estate syndication is.
Sam Taube 3:05
So real estate syndication is a group investment where a bunch of investors pool their money together to buy or build something, typically something big, like an apartment complex or a shopping center. Big expensive things that you need a lot of money for.
Sean Pyles 3:19
Mm-hmm.
Elizabeth Ayoola 3:19
Well, you can get involved with real estate syndication in different ways, Sam. I know because I was researching the topic. And one is by joining a real estate crowdfunding platform. Can you explain to me how this works?
Sam Taube 3:31
Real estate crowdfunding platforms organize these kinds of syndications online, which gives investors some of the ease of use of like an online brokerage account.

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