What is an Accredited Investor and why you should know?

Many passive real estate investment opportunities, such as syndications, are only open to accredited investors. Investment opportunities for non-accredited investors can be more difficult to find, as they can’t be publicly advertised due to SEC regulations. Therefore, accredited investors have the choice of getting into these types of deals.

You must meet one of these criteria:

• Net worth in excess of $1 Million (not counting your primary home)
  OR
• $200K yearly income ($300K for a couple) over the past 2 years and you expect to earn the same or higher in the current year.

What about Non-accredited Investors?
There are some real estate syndications that take non-accredited investors, called Sophisticated Investors. These investors must have sufficient experience and knowledge in business and finance to make them capable of evaluating the risks and weigh the potential merits of the investment.

Other options for non-accredited investors who want to invest in real estate passively are in individual REIT stocks (publicy-traded real estate investment trusts) or real estate crowdfunding marketplaces such as Fundrise and Realty Mogul.

Written by:

Agnes Wong

-San Francisco Chapter Leader