I recently had the pleasure of chatting with Matt Burk, CEO of Fairway America, about the U.S. real estate market. A lot of investors make the assumption that buying a rental property is the only way to invest in U.S. real estate when there are so many other ways. Small balance real estate funds are just one of the many new ways to invest in real estate.

Fairway America is hosting the SBR Investment Summit October 16-17 in Seattle, Washington, where those serious about real estate investing will have the opportunity to meet small balance real estate fund managers in person.

Here’s my candid interview with Matt Burk where we discuss the industry and what investors should know and how to achieve greater success.

 1. You have a Small Balance Real Estate Investment Summit scheduled this week in Seattle, Washington. Can you tell me a bit about it and why real estate investors should attend?

The summit provides the opportunity for fund managers to go out and openly talk about small balance real estate funds. Previously talking about these funds was prohibited by. You have a huge demand for capital and you have investors looking for decent return, income and growth, yet they don’t’ even know small balance real estate funds exist. The number one thing is to learn the ins and outs of small balance real estate funds. Like any investment there are risks. At the summit there will be 24 fund managers from around the country that can give investors a glimpse of what they can choose from.

2. Can you talk about how real estate market has become a strong personal finance option for retirement planning and investing?

I think real estate has always been attractive. It is the number one investment class. I think most people realize having some exposure to real estate is a good investment. I think a lot of folks have a hard time figuring out how to get exposure to that space without owning a property. Obviously there was a bit setback in 2008, but real estate tends to have characteristics about it: a good downside, capital protection, appreciation of asset, and generation of income. There are a lot of ways to get exposure to it for anyone who has a well-rounded portfolio.

 3. What are the top 3 things potential investors need to know about real estate investment?

1. The funds exist. That’s the biggest one. Many people don’t know small balance real estate funds exist.

2. You don’t have to have gigantic amounts of money to get exposure to this. You can do it as little as $50,000.

3. You can achieve diversification inside the real estate space. You don’t have to own a rental property to get exposure to it. It depends on the size of someone’s portfolio. The stock market for most people is a crapshoot. You want to have a diversified mix. The average investor is not over exposed in real estate.

4. What advice would you give on how to achieve greater success in real estate investing?

You should educate yourself and learn the basic principles, so you understand what you options are. Keep an open and inquisitive mind. There are many options about how to invest in real estate. If you’re truly interested, find ways to find out. Ask smart questions and go with your gut. If things don’t make sense question them; do your own homework. Most people are smart; people just need to educate themselves. Take your time. If you’re well-prepared, opportunities are always there.

5. With housing prices on the rise since the stock market fell, do you still think it’s still a good buying opportunity for real estate investors? What about Canadian real estate investors?

Pick and choose your markets wisely. I think there are more markets overheated, but I think the fundamentals are strong and will remain strong. I think there are tax-related issues for foreign investors. Subject to understanding the tax consequences, yes, I think there are good opportunities for Canadians. There are lots of ways to gain exposure to the U.S. real estate market besides running down here and buying a house. Buying a house is one way of dozens of way. People who are serious should explore a variety of ways based on their portfolio objectives.

 6. What are the most common misconceptions about real estate investment?

There is only one way to make money in real estate when really there are lots of way or that it has to be highly capital intensive. Some buy distressed debt and sell debt off. As an investor you don’t have to do that directly. You can invest in a fund and earn interest and distributions. You can invest $50,000 and you don’t have to deal with property. To do that well you need to understand how you pick and choose.

Sean Cooper is the bestselling author of the book, Burn Your Mortgage: The Simple, Powerful Path to Financial Freedom for Canadians, available now on Amazon and at Chapters, Indigo and major bookstores, and as an Audiobook on Amazon, Audible and iTunes.