Passive Investing 101

Your capital works.
You don't have to.

Passive real estate investing means you contribute capital to a deal — and someone else does all the work. No tenants calling you on a Saturday. No contractors to manage. No inspections to schedule. You keep your job, your schedule, and your sanity, while your money builds wealth in the background.

At SageVestments, the operator (Jansie Cruz) handles acquisitions, renovations, management, and reporting. Investors receive their returns through cash distributions, refinance proceeds, and appreciation at exit — alongside transparent quarterly reporting on how every asset is performing.

The bottom line: You don't need to quit your W-2, become a landlord, or learn how to analyze deals yourself. You partner with someone who already does this full-time — and share in the returns.
Current Portfolio Snapshot
11+
Active Doors (OH)
$2M+
AUM
$1M+
Investor Capital
3
Exits Completed
Markets
Ohio Pennsylvania Florida
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How Returns Work

Three ways real estate pays you

Most passive investors focus on one return stream. Real estate delivers three — and when they stack, the total return is often greater than any individual piece suggests.

💵

Cash Flow

After the mortgage, property management, taxes, insurance, and maintenance are paid, whatever is left is cash flow. It's paid to investors on a regular distribution schedule — typically monthly or quarterly.

Note: Not every asset cash-flows immediately. Some value-add properties require operational improvements or lease-up before achieving stable cash flow — and we underwrite honestly to that timeline, not a best-case projection.

What it means for youRegular income from real estate without managing a single tenant or property.
📈

Appreciation

Properties increase in value over time, both from market forces and from operational improvements. Appreciation is typically captured at refinance (where you can pull equity without selling) or at sale (where the profit is split with investors).

Value-add investing accelerates appreciation by creating it operationally — through rent increases, expense control, and physical improvements — rather than waiting passively for the market to move.

What it means for youYour capital grows even when you're not watching. The BRRRR refinance event is often when the biggest capital return happens.
📄

Depreciation

The IRS allows real estate owners to deduct a portion of a property's value each year as a non-cash expense — even if the property is actually going up in value. This depreciation can be passed through to passive investors to offset passive income.

This is one of the most underappreciated advantages of real estate investing. Consult your tax advisor about how depreciation benefits apply to your specific situation.

What it means for youYou may owe less in taxes on the income you receive — a benefit that exists nowhere else in most passive investment vehicles.
Investment Criteria

What we look for before we buy

Criteria vary meaningfully by asset class. Use the tabs below to see what drives underwriting for each type of investment.

🏡 Acquisition Parameters

  • Target basis: Acquisition + rehab costs at or below 70% of After-Repair Value (ARV) — a standard specific to residential comps-based valuation
  • Asset profile: 3–4 bedroom homes in working-class neighborhoods with proven rental demand
  • Markets: Ohio and Pennsylvania primarily; select Florida pockets
  • Price range: $80K–$200K all-in (market dependent)

✅ Deal Indicators

  • Below-market purchase price relative to ARV (distress, estate, off-market)
  • Identifiable rehab scope — cosmetic or light structural, not full gut
  • Rent-to-price ratio ≥1% monthly rent to purchase price (market dependent)
  • Positive cash flow after vacancy, maintenance, and PM at realistic market rents
  • Refinance feasibility — lender-appraised ARV supports cash-out refi to recover capital
Why 70% ARV matters for SFH: Residential single-family properties are valued by comparable sales (comps), making ARV a reliable anchor for underwriting. Staying at or below 70% of ARV leaves room for holding costs, a refinance at 75–80% LTV, and unexpected overruns. This metric is specific to SFH and small multifamily — large multifamily and senior living use NOI-based cap rate valuation instead.

🏘 Acquisition Parameters

  • Target basis: All-in cost conservative relative to ARV; same 70% ARV discipline applies for 2–4 unit residential properties valued by comps
  • Asset profile: Duplexes, triplexes, quadplexes — 2 to 4 units
  • Markets: Ohio and Pennsylvania
  • Condition: Value-add — deferred maintenance or below-market rents

✅ Deal Indicators

  • Below-market rents with a clear path to market rate post-renovation
  • Stable neighborhood — employment base, low vacancy area-wide
  • Refinance exit supported by appraised value after stabilization
  • Cash flow positive at stabilized rents with realistic vacancy and OpEx
  • Strong unit mix — 2+ beds per unit preferred for tenant stability
Same discipline, larger cash flow: Small multifamily applies the same BRRRR and ARV-based underwriting as SFH, but benefits from multiple income streams per acquisition — spreading vacancy risk across units and improving cash-on-cash returns per dollar deployed.

🏙 Acquisition Parameters

  • Valuation method: NOI-based cap rate — not comparable sales. Value is driven by net operating income, not what the neighbor sold for
  • Target cap rate: Acquisitions at a cap rate spread above local market cap rates to ensure margin at entry
  • Unit count: 50–250 units targeted; flexibility for exceptional assets
  • Markets: Ohio and Pennsylvania initially; Florida secondary

✅ Deal Indicators

  • Below-market rents — proven gap between in-place and market rents that operational improvement can close
  • Expense inefficiency — management or operational costs above peer comparables, indicating room to improve NOI
  • Physical value-add — unit interiors or common areas that support rent premiums post-renovation
  • Durable submarket — employment base, population trends, and rental demand supporting long-term occupancy
  • Conservative debt service — DSCR ≥1.25x at in-place NOI before value-add improvements
Why ARV doesn't apply here: Large multifamily properties are valued by cap rate (NOI ÷ Value), not comparable sales. A $5M apartment complex is worth what its income supports — not what the building down the street sold for. This distinction drives fundamentally different underwriting logic from SFH.

🌿 Acquisition Parameters

  • Valuation method: NOI-based with healthcare-specific adjustments for licensing, compliance costs, and management structure
  • Asset types: Assisted Living and Memory Care (primary targets); Independent Living considered selectively
  • Markets: Selective secondary markets with demographic tailwinds (aging population) and regulatory clarity
  • Operating structure: Partnership with experienced senior living operators — not self-managed

✅ Deal Indicators

  • Licensing and compliance status — clear regulatory standing with no outstanding violations
  • Below-stabilized occupancy — identifiable path to higher census through operations, not hope
  • Management quality gap — incumbent operator underperforming against peer benchmarks
  • Demographic demand — local aging population growth supporting long-term census
  • Conservative pro forma — stress-tested at lower occupancy with full compliance cost burden modeled in
Compliance-first underwriting: Senior living is not just real estate — it's healthcare. Regulatory compliance, resident care standards, and licensing are underwritten with the same rigor as the financials. A deal that doesn't pass compliance diligence doesn't move forward, regardless of the return profile.
Deal Sourcing

How we find the right deals

Good deals aren't found on the MLS. They're built through relationships, systems, and a willingness to walk away when underwriting doesn't work.

1

Source

Direct-to-seller outreach, broker relationships, wholesalers, and market-specific networks. Off-market deals get the best basis — we prioritize them.

2

Analyze

Every deal is run through a full underwriting model — conservative vacancy, full management costs, stress-tested debt, and realistic exit assumptions.

3

Diligence

Physical inspection, title review, market rent comps, contractor estimates, and lender pre-qualification before any commitment.

4

Execute

Close, renovate on budget, lease to quality tenants, and stabilize. Then refinance or hold — based on what the numbers support, not a pre-set timeline.

Getting Started

From curious to invested

Four steps. No pressure at any of them.

1

Intro call

30 minutes. Tell me your goals, capital range, and timeline. I'll explain what's in the pipeline and what structures make sense.

2

Mutual fit check

Honest assessment. If it isn't the right match — wrong risk tolerance, wrong timeline, wrong asset class — we say so. No pitch pressure.

3

Materials & diligence

Deal specifics, underwriting models, and track record shared under appropriate disclosure. Your turn to ask hard questions.

4

Execution

Documentation, capital call, and a clear reporting cadence from day one. Then you collect returns — while I run the operation.

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