There is also these investment group management companies that outsource management to local management companies and take a spread on the revenue.

Typically a JV agreement is unsecured and if a deal loses money then so does the investor (nothing new there), therefore our investor is looking to lock in a rate of return which pays interest payments along the way.When it comes to performing notes, it’s strictly a cash flow play, by where we are earning a spread between what we borrow in the form of a promissory note and what we earn on the mortgage note.The collateral assignment that we attach to the note is incase of default and provides extra security to the promissory note. 

@Anthony Gayden this isn't a wide spread problem.

However there are some products that are single asset products that can be passive and act like a REIT yet retain 1031 eligibility.So sell and 1031 - total tax avoidanceSell and partial 1031 - partial tax avoidancesell with installment sale - no tax avoidance but tax is spread outgive you a NNN lease and option - no tax recognized at all other than ordinary income on lease payments.  

even though for many Out of state investors it basically wipes out the first 6 to 12 months of cash flow  IE your expense to travel to the market pay for hotel car  dining out ( although you have to eat no matter where you area)... but its nice to spread those expenses over multiple properties.in the foreclosure bizz this is just SOP  par for the course.. many times you can't get in.. especially with an owner that may be a tad hostile. 

At the end of the day for me what matters is how much of a spread i have on the value of the property compared to what i am buying the note for. 

The goal is create a wide enough spread between purchase + rehab costs vs ARV so when you refinance you are able to pull out the initial cash you had to put into it.  

I've posted this in the "Real Estate Success Stories" forum but perhaps its would fit better in the "Real Estate Life Lessons Forum".There is a ton of talk in the media but also on these forums of the precariousness of our national and global financial structure and the values of assets as currently traded.  

conventional logic would be that you spread your risk over 5 doors instead of one. the only part that might be more difficult is obtaining financing as most mf lenders will require a deposit of 20% or more. good luck!

In Los Angeles county (non rent controlled areas) I'm looking at 4-12 unit properties.Every property I inquire about the agent will give me big spread sheets with all the rent rolls, minus expenses, etc.