Have you ever heard of the the ‘Howey’ test?

If you want to raise money from private investors to fund real estate investments, you should know what the Howey test is and what it means to you.

J. Howey was a Florida entrepreneur who was selling real estate contracts to finance the development of citrus groves that he owned (a sale-leaseback type of deal). Howey was offering people to buy his groves and then he would lease them back – so the buyer would earn their returns from rents received for Howey tending the land.

So what? Who cares? How does this impact real estate investments? Read on…

The issue that the SEC took with J. Howey and his real estate deal was how he was marketing his investment opportunity. You see, Howey marketed his land sales via Read More→