BacX has recently entered into China market to bridging the channel for Chinese RE investors investing in US housing market, we are overwhelmed with so many interests along with lots of questions, thus we like to sum up as follows:
How could our investment funds and assets be well secured and protected?
BacX is your RE investment navigator, planner and manager as well as your 10-20% shareholder and partner. Each investment project is conducted in an independent LLC company, such as Project A LLC or Project B, C, D LLC etc. As investor, you are the owner and shareholder of each particular LLC and your ownership and share is associated with the fund amount you have invested in each project. Your rights and ownership as well as liabilities are well defined, protected in operating agreement and LLC registration legal documents. We use American Elite RE law firms to register and establish LLC and produce tailor-made operating agreement. American Legal System is worldwide well known and established for hundreds of years, any behavior leads to the law breaking and fraught activities related to fund management will face legal consequences, in most cases, ending in prison.
How long will it take for investors to hold before materializing their investment returns?
To fully optimize the investment potentials, a high-quality investment needs to be held for 2-7 years. This could also prepare investors to manage the risk to avoid dumping the assets when there is economic crisis such as 911 or 2008 financial crisis. During market and economic crisis, strategic long-term RE investors, instead of selling, would take the market advantage to buy and expand their RE portfolio. However, we understand that some investors prefer to have short-term investment and return. Therefore, we have tailor-made investment projects to meet each investment group’s needs. It includes 1-2 years projects, 2-7 years projects and even longer projects such as long-term investment assets, hotels, commercial multiple family unit complexes, shopping strip etc. As a reminder, during holding period, there are other handsome incomes such as operating income, house appreciation and rent increasing.
Can investors withdraw their investment funds earlier?
Yes, investors’ right and obligation are clearly defined and protected in legal operating agreement conducted in each project LLC. The investor who likes to withdraw earlier first should try to sell his/her shares to those investors already inside the projects based on whatever market value is at that time. If he/she failed in selling internally, he/she could then go to sell externally to bring new investors to replace him/her.
Since BacX is the investment fund manager and also provides 10-20% investment fund. BacX takes the full responsibility of each project and investors have right to participate but no right to involve in decision making, In this case, how could the investors control the risk?
Avoiding the investors’ involvement in decision making is actually one of the key factors to reduce our investment risks. Even though many oversea RE investors have already gained dramatic experience in their domestic market, the investment model and criteria could be completely different from here in US. For example, many Chinese RE investors like to invest in newly built properties while in US the true investment value is in old properties located in central and convenient area. BacX has in operation in US for over 10 years and have constantly stayed active in the market strictly according to its own unique acquisition and investment criteria and model. For good faith, we particularly invest 10-20% of our own money in each project as risk diversification tool for our investors. In other words, if the project losses money, BacX will lose its 10-20% first before common investors. This is unique investment service and we haven’t heard any other similar one yet in today’s market.
Are there any incomes during investment holding period?
Yes, 100% of net operating income and is deposited in LLC bank account first half of each month. Each investor has its log-in information to LLC bank account to supervise the account. Normally, the operating income is no less than 5% of cap rate for the first year, In the future, it will be rising year by year through better rental market and property management, besides the incomes from property appreciation, rent rise and exchange rate difference.
How long it takes to have the fund invested into project after wiring?
Normally, 2-3 weeks. BacX has daily interaction with each different RE market and have established a high-quality and large-scale business networking, it normally takes no more than 3 weeks to find deal and have the funds invested in the deal. This has also differed us from many others that we are actively looking for the best available RE investment properties than trying to sell the low value properties for agent commission.
During the 2-3 week investment vacant time, how is the investment fund protected and is there any income?
All the funds are managed and protected strictly according to the operation agreement under LLC name. Before funds are actually invested into projects, the bank interest is the only income occurred and 100% belong to Project LLC (all the investors).
When and how can investors materialize and obtain its investment return?
Once funds are invested in particular projects, immediately, there is net operating income. After properties were sold, investors will have the first priority to obtain first its 100% investment fund principle and then 80% of after-sold profit. Once the investment project is completed, investors could choose either continue to invest or close its investment profile with BacX.
Why investing in US RE market?
Under weak global economy and instable political movement, US as one of the very few countries has demonstrated its strong and solid economic and political strength. Along with its global leading role in high-technology and innovations and best available RE investment tax incentives, US undoubtedly becomes the sole focus for overseas RE investors.
For example, under 1031 House Exchange Policy, the after-sold profit from any of your RE investments could be tax-free if you continue to invest into other RE properties. Imaging that you make $500,000 profit from one RE investment and pay no tax as long as you continue to invest, what a great deal! Moreover, the imposed extra tax for foreign RE investors is called off by Obama government early this year, now the tax is absolutely the same for foreign and local investors. The US is also the only country that offering 30 years fixed mortgage interest rate, the current rate in 2016 is 3%-4%. You will be amazed if you give it good thought that $1000 today will only worth less than $100 in 30 yrs.
Why choose working with BacX as a Chinese investor while it looks there are many other options in the market?
· Powerful group company platform holds over $500million
· Hold millions of good quality properties for long term.
· Unbeatable RE investment and global business operating experience
· Rich investment network and platform
· Diversified investment area and tailor-made portfolio
· Risk sharing(10%-20% invested as warrantee)
Why investing RE in the US NOW?
There are many, here is a few major ones:
1. The Chinese economy is now entering into long-term slow-down period, along with depressed stock market and severe housing bubble, the good investment opportunities become sporadic, while the other side of the world, US RE market is still full of energy and opportunities. Investing in the US now avoid the loss of opportunities for you.
2. Chinese economy recovery will take longer time, consequently, RMB will continue be under devaluation pressure. Many famous economists foresee that US dollar will stay robust in long-term. Investing in the US RE market can not only reduce the currency risk but also achieve assets risk diversification.
3. Driven by globalization, investment abroad is only one step beyond. Obsolete regionalization and localization are old fashion long time ago. With huge wealth-building up in the past two decades in both China and some other developing countries, travelling and investment in America are now the new life style and fashion trend, which will further formalize the solid US RE investment foundation.
4. With more and more overseas students coming to US, many parents are impelled to invest RE properties in US. This is not only a good way of managing family assets but also saving high student rent expense. This is another new fashion just recently happening.