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Risks

Debt Free Single Family LTR in high-growth, business-friendly, and low tax markets we categorize as low to moderate risk. The following are some of the projected risks, mitigated risks, and deferred risks.

 

Deferred Risks *
  1. Interest Rate Spikes
  2. Refinance availability risk and cost
  3. Liquidation timeline pressure
  4. Default

 

Mitigated Risks *
  1. Diversification via regional acquisitions
  2. Technology driven property management
  3. Advanced tenant screening algorithm that leverages historical data
  4. Insurance and Maintenance contractor network
 

Risks *
  1. Deep and sustained property devaluation
  2. Major reduction of LTR demand
  3. Natural Disasters
  4. Tenant Default


* See PPM for a complete list of potential risk disclosures.



Risk Spectrum by Asset Type


Cryptocurrencies: Very high risk due to extreme volatility and regulatory uncertainties.

Derivatives: Very high risk, complex financial instruments with potential for significant losses.

Tech Start-ups: High risk, particularly early-stage companies with uncertain futures.

Venture Capital: High risk, investing in early-stage companies with potential for high returns or losses.

Oil & Gas Exploration: High risk, subject to commodity price volatility and regulatory changes.

Forex: High risk, currency trading with significant leverage and volatility.

Private Equity: High risk, involves investing in privately-held companies.

Crowd Funding: High risk, often involves start-ups or small businesses with limited track records.

Privately Traded REITs: High risk, illiquid and less regulated compared to publicly traded REITs.

Multifamily Real Estate Syndications: Moderate to high risk, depending on property location, market conditions, and management expertise.

Private Credit: Moderate to high risk, involves lending to private companies which may have higher default risk.
 
Commodities: Moderate to high risk, influenced by supply and demand factors and geopolitical events. 

Publicly Traded REITs: Moderate risk, subject to market fluctuations but more liquid and transparent.

Other Low Cost Index Funds: Moderate risk, diversified and generally lower cost, but still subject to market risk.

S&P 500 / Low-Cost S&P 500 Index Funds: Moderate risk, broad market index with diversification and low fees.

Debt Free Single Family Rentals (in high growth, business-friendly, and low tax markets): Low to moderate risk, due to location benefits, debt free capital structure, providing stable income, and potential for appreciation.

Treasury Bonds: Low risk, backed by the government with fixed interest payments.

CD - Savings: Cash Equivalent: Lowest risk, very safe with guaranteed returns and high liquidity.