Learn To Be A Fix and Flip Investor: How the real estate industry benefit from the medical marijuana market?

Friday, March 17, 2017

How the real estate industry benefit from the medical marijuana market?

The cannabis industry has been, and always will be a major cash crop. With the passing of Prop 64, California has become a hotbed for the plant. California has always been known for its cannabis culture, and with more states jumping on the bandwagon the real estate industry can profit from it. Hard money lenders in California should consider lending in this area, as well.

So, how can a hard money lender in California make money in the industry?

This is simple, do what you do best, lend people money. You may be a little apprehensive about loaning money to someone who is involved with this market, but you may make a lot off your investment. Medical marijuana has been taking off like a rocket over that last few years and is estimated to be worth billions of dollars. Most of this comes from merchandise and of course the plant, but production is key when you are getting in the business. Since it is considered a part of the “gray market,” you have to be vigilant when choosing a piece of property that you want to use.

You need to make sure the property you are looking into follows certain guidelines. For example, the dispensary or lab you will ultimately open needs you follow certain zoning laws. You are obviously not allowed to open anything near a school. That facility also needs to be in a commercial area since it will be operating as a business.

Where do you start in the business?

Well, the first thing you need to do is find a building that you are able to use. Sometimes you will have to make sure you contact the city you are working in. If you are the main proprietor of the building another you want to start looking for a lender that wants to help you. A commercial hard money lender in California is a great way to start the process. Lenders, if they can see your vision, should be able to lend a sizable amount.

Depending on if you are planning to open a warehouse or a dispensary, you have a fairly large loan that you may be able to use for the facility. You could potentially be able to borrow a loan anywhere from $500,000 to $3,000,000. This is contingent on the size of your lender. The loan would typically last around one to three years with an interest rate of about 12 percent. Since the market makes so much money, you can pay off the loan quickly.

This real estate market is ripe for the picking

Cannabis is a cash crop that is going to be around for a while; well in California at least. Money can be made by everyone. With enough work and the right real estate team there could be shops and dispensaries throughout the state. On average, about 760,000 people benefit from medical marijuana in California. With the law still in its early stages, this is the right time to jump on the bandwagon.

About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.