Can my friends and I start this business?

[Mark91]

My friends and I are hoping to start a company (LLC was our thought but we are open to ideas) which would research land and properties to buy and to rent to others. Can anyone help us to start this type of business? are there any tax advantages of this type of business?

[Wozcreative]

Your question is very broad. What do you already know about the business? What do you need to currently learn? Why are you going into this specific business? What is your previous experience? Your partners experience?

[Richt]

I agree with Wozcreative, the answers to her questions would be very helpful in giving you advise. There are many ways to get in the real estate business, LLc is probably a good structure but you may want to consider limited partnerships for each property with your LLC as the general partner of each Limited partnership. depending on what country you are operating in this may give you an added layer of protection if one deal goes bad without affecting your other deals and also the ability to raise outside private capital for a specific deal or property that requires more upfront cash then you and your partners may have without giving away equity in your LLC. In some States an individual or LLC is limited to the amount of properties owned and rented without forming a management Company and in my state, North Carolina you need a Real Estate Licence to form a management Company, other States may or may not require licencing. Check the state your operating in by going to your state and city official websites and look under Real Estate Licencing. But the first thing to do is post answers to Wozcreative's questions so we all have the right information in order to point you in the right direction.
good luck with your new venture I look forward to seeing your updated post with more details

[Mark91]

Your question is very broad. What do you already know about the business? What do you need to currently learn? Why are you going into this specific business? What is your previous experience? Your partners experience?

I guess my question would be: can we still "start" a business without having a product to rent or sell? Can we start this business and then start scouting locations? And what if it takes 2 or 3 years until we actually make a purchase, is that a problem?

[Mark91]

depending on what country you are operating in

I am located in the Usa

[Wozcreative]

You can definitely start a business.. you would be in a "services" type of business. To give you an example, I don't have a product to sell, but I offer my service of designing and developing a product which will take time to create before a client gets the product. This is the same for you. You will first need to learn about the company you are providing the service to and find the "right" location for them.

It is probably simpler to find the right location for a client rather than find the right client for a location.

Your big problem though would be that with no past experience, you will have a difficult time convincing people to take you on for this type of service. There is a lot of experience required for this type of service if you've never done it. Especially if you are selling farm land to build on.

I could suggest booking some time with someone face to face on Google Helpouts (https://helpouts.google.com/home) and get a good idea of where you would need to start from a professional who's already done what you need to do.

[Freelancier]

You can always "start" scouting locations to figure out what's out there and what might be something you could buy and lease out without having a business entity around your actions. However, if you start incurring expenses doing it, you'll want to track them separately from any other business or personal expenses. Once you're ready to commit money to the enterprise by purchasing a site, you'll want a business entity just to provide a liability shield and a clear financial position for each partner/owner of the entity. Until you have revenue or significant expenses, you really don't have a business, you just have an idea.

[ARMGenius]

My friends and I are hoping to start a company (LLC was our thought but we are open to ideas) which would research land and properties to buy and to rent to others. Can anyone help us to start this type of business? are there any tax advantages of this type of business?

Yes, this can be a lucrative business to start, especially if you know how to purchase your properties at the right price, as this will ultimately be one of the factors that dictate your success or failure. You can start a LLC, however some would argue that an actual corporation would provide you with further separation, especially if working with multiple partners. You should consult a tax professional about the tax advantages, I'm sure there are many as you're dealing with real estate.

What is even a better business is to purchase a property, setup someone to buy it and essentially finance it for them, sell the note to a bank or note buyer who will pay you a large fraction of the note's face value upfront. This is a booming business that many have gotten into, especially with the high number of bank foreclosures.

[investmentreinvestor]

I started out with the LLC structure. It is a great asset protection vehicle and highly recommend it. You want to consult a lawyer that is strong with real estate investments, let him know your plan and he should be able to offer ideas on how this should be set up. The way I have my business set up goes a little further than just an LLC, that's why I recommend consulting a lawyer to help you set up your business to tailor your specific needs.
Good Luck!