Real estate can be good investment ? ? Rankin RealtyRankin Realty

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Want to consider moving some of your 1-percent saving account money into a real estate purchase yielding multiple times that rate? Given the 25-percent increase in area non-foreclosure property sales transactions, it should be safe to wade in to the market a bit.

Are there good real estate deals available for investors to acquire? Yes, there are many viable local deals available. With bank lending so tight today, having an investor pay cash for a property can benefit both sellers and buyers. This opportunity can be particularly good for an existing investment group, as they can spread risk and acquire larger properties.

So, one of your best friends has found a property to buy. It?s a great deal and all he needs are some friends to invest some money. So, you put up $20,000 and wait for your share of the rent checks to come in. Sounds simple. Chances are, however, your friend has just violated NC Securities law against selling ?un-registered? securities. Even if every investor is ?on the deed? as Tenants in Common, there are NC Secretary of State?s office compliance issues to consider.

Forming an investor group without legal counsel can create a problem. If not properly structured, the deal can be construed as being an ?un-registered security.? If one of the investor/owners later becomes unhappy, the issue of securities will certainly be one that the disgruntled investor/owner?s attorney will verify.

The 2011-2012 NC Real Estate Manual, in Chapter 19, speaks to a ? ?type of transaction where a real estate broker plays an active role in finding investors to contribute money to an entity to acquire? property. ?The interests offered??..? would be securities ?? My take on the guideline is that real estate brokers should stick to selling property to individuals and existing entities, but not be involved in the formation of such an entity.

From my understanding, an individual (even though not a real estate broker) offering shares in a deal could also be scrutinized as offering security interests. The key to avoiding running afoul of the Secretary of State?s enforcement office is legal counsel before forming a company to invest in real estate. Many local attorneys are versed in both real estate law and in business formation.

That said, now is a good time to consider which property is good for your investment. The old saying, ?buy low, sell high? may well fit the trend so far this year.

The above information about when real estate deals can become security transactions is presented as an introduction to the topic. No person-specific or transaction-specific legal advice is given. Individuals should seek legal advice regarding how the topic may apply to their transaction.

Alex Rooker?s newsletter, link http://realtytimes.com/c/alexrooker The data is as interpreted by Rooker and is not necessarily reflective of Media General, nor other members of the Realtor Association or Catawba Valley MLS.

Article source: http://www2.hickoryrecord.com/business/2012/jun/02/real-estate-can-be-good-investment-ar-2325777/

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