Real estate can be one of the most valuable assets, especially in today’s volatile times.
Historically, real estate has almost always been a worthwhile investment. Property values have steadily and consistently increased over time in the face of economic turbulence and inflation. This has generally been true whether the investment is bare land or developed real estate.
Where you buy, what you buy, and how you invest are big decisions in your real estate investment journey. You’ve likely heard the saying, “Location, location, location.” With this in mind, some real estate will be more desirable than others.
When looking around for your next real estate investment opportunity, we strongly recommend you put Oregon at the top of your list.
If you’re familiar with Oregon, you’re aware of the boundless beauty and diversity of this state. With mountains, valleys, coastal, and high desert geographical regions, Oregon offers a wealth of scenic options and climates.
The dominant economic area runs through the I-5 corridor, with the largest cities being Portland, Salem, and Eugene. However, smaller towns like Albany, Lebanon, Corvallis, Roseburg, Medford, and Bend still offer a wide range of business and residential real estate investment opportunities.
Additionally, the beautiful Oregon coast and wine country throughout the Western Oregon region have garnered increased interest from out of state residents and investors in recent years.
Oregon has several major colleges, including the University of Oregon, Oregon State University, Portland State University, Willamette University, Linfield University, and Southern Oregon University. With these thriving educational establishments, an overall growing population, and seasonal tourism, real estate sales and rentals are both top investment opportunities.
Here are more reasons why this state stands out for real estate investors.
Variety and Diversity
Oregon has a number of real estate investing opportunities. “Fix and Flip” properties can be found throughout the state and are a popular option among investors. With rapid and steady home value appreciation and a significant number of older distressed properties needing rehabilitation, home flippers have the wind at their back with strong profit potential.
Buying, rehabbing, and renting properties as either long-term, mid-term, or short-term rentals is also a viable strategy given Oregon’s housing shortage and low vacancy rates.
Due to Oregon’s scenic beauty and thriving cities, short-term rentals are popular all across the state. Whether you’re looking to add a rental along the pristine Oregon Coast, near business and recreational activities throughout the I-5 corridor, or nestled in the scenic Cascade Mountains or High Desert areas, people are drawn to Oregon for a variety of reasons.
Outdoor activities like hiking, fishing, skiing, and rock climbing keep people coming to Oregon year round which can make short-term rentals a long-term supply of cash flow.
Eugene hosts international track events, bringing in people from all over the world. They’re going to need somewhere to stay while they’re here, and that’s where your rental comes in.
Just remember to check with the local city or county for any restrictions or licensing requirements for short-term rentals. Short-term rental popularity has exploded, leading to some jurisdictions passing restrictive ordinances aimed to curb market saturation and protect native homeowners.
For investors looking for long-term rental opportunities, the growing technology industry continues to bring more people to Oregon for new good-paying jobs with a relatively low cost of living. Since the COVID-19 pandemic and emergence of remote work as commonplace, many young professionals continue to flock to this beautiful state. After all, if you work from home, you might as well do it with natural beauty in your backyard.
Oregon’s wide variety of markets and industries provide investors with a range of diversity to expand their portfolios. The ability to reduce risk by having a variety of different assets, geographical regions, and investment strategies, encourages stability in your real estate investments.
Oregon is a Growing State
Oregon’s population is growing and this creates a demand for real estate, especially housing. “Fix and Flip” opportunities are abundant, which help in more ways than one. By offering ready-to-go, turnkey houses for sale, people coming to Oregon have a quick and easy transition with the move to a new area.
Likewise, house flippers can get well-compensated for taking the risks and upgrading neighborhoods that need revitalization.
Predictions for 2025-2030 population growth are encouraging. Some research shows expected growth in Oregon to be up 3.9% by 2030.
Here at Cetan Funds, we see this as a sign of a bright future for both our borrowers and Fund investors. We lend on projects throughout the state, and Oregon’s population growth is a big driver for the positive market trends we see on the horizon.
In particular, investors in our Cetan Income Fund or Cetan Opportunity Fund can capitalize on these trends and achieve strong, consistent returns on their well-diversified, alternative investment in Oregon real estate debt.
More Benefits for Investors
Property taxes in Oregon are slightly lower than the national average. The average effective property tax rate is 0.82%, and is reliably stable from year to year, thanks to two laws that were established in the 1990’s.
Measure 5 and Measure 50 together, limit the overall effective tax rate that can be imposed on a property and the annual increase in values that are used to calculate taxes.
In addition, restrictive land use planning and, in particular, laws passed in the 70’s and 80’s establishing Urban Growth Boundaries, have led to a dearth of housing starts.
Developers face a challenge adding to our housing stock. While many investors see this as a negative, Oregon’s restrictive land use process creates tremendous opportunity when the population is on the rise like it is now.
New housing starts cannot keep up to demand, and when demand consistently outweighs supply, values consistently go up. The scarcity of new construction makes speculative construction another great potential avenue of success for borrowers, if they can find the right affordable land to build on.
When you’re ready to get started, ask a Cetan Funds team member about how to build wealth through real estate in Oregon. After years of experience in the Oregon real estate market, we can help you decide which investments are best for you.
Whether you’re looking to borrow from the Fund to invest in a property, or invest in one of our Funds for a more creative and passive investment in Oregon real estate debt, we can help guide you to the right decision for your portfolio.
We work closely with borrowers and focus on diversification within our Fund, helping mitigate risks and provide strong, stable returns for investors.
Contact us to see how you can build wealth through Oregon real estate.
Loan Inquiry
For more information on how Cetan Funds can finance your real estate project, please fill out our inquiry form below. We will respond in two business days.
Your Contact Information
Information collected will only be used to evaluate your loan.
Investor Inquiry
For more information about investing in Cetan Income Fund, please fill out our inquiry form below. We will respond in two business days.
Your Contact Information
Information collected will only be used to contact you.
Broker Inquiry
If you have a deal you need help funding or want to inquire about our Broker Referral Program, please contact us below.
Your Contact Information
Information collected will only be used to contact you.
General Inquiry
We’d love to hear from you. Please submit your inquiry below and we will respond in two business days.
Your Contact Information
Information collected will only be used to contact you.
General Investor FAQs
What is Cetan Income Fund’s Investment Objective?
Cetan Income Fund and Cetan Opportunity Fund (the “Funds”) are real estate debt funds that deliver consistent and attractive risk-adjusted returns to investors who seek preservation of capital and income.
Who Manages The Fund?
Our CEO, Mary Merriman, manages the Fund and lending operation. She has over 40 years of lending experience, holding a variety of executive-level positions at banks and an economic development lending organization. Steven Yett is actively involved in daily operations, fund management, and business development. Zach Smith is also an integral part of the team, leading loan originations and other business development activities. To learn more, please visit our Meet the Team Page or contact us.
Can Anyone Invest?
Cetan Income Fund: This Fund is only open to accredited investors with a net worth of $1,000,000 excluding their primary residence, or annual income of $200,000 for single filing status or $300,000 for joint filing status. This Fund is open to investors from anywhere in the United States.
Cetan Opportunity Fund: This Fund is only open to Oregon residents with either 1) a minimum annual gross income of $70,000 and a minimum net worth of $70,000 excluding their home, home furnishings, and automobiles; or 2) a minimum net worth of $250,000 excluding their home, home furnishings, and automobiles.
Can I Invest with IRA Funds?
Yes. Investors with a Self-Directed IRA account can invest in the Fund. Currently, we are well below our 25% threshold.
If you do not have a Self-Directed IRA account, we can help you create a self-directed IRA (SD-IRA) account and use those funds to invest in the Fund. Please contact us with questions and a list of IRA custodians we have worked with in the past.
Cetan Income Fund also includes a promissory note offering for accredited investors, which many of our IRA investors benefit from.
How Do I Track My Account Balance?
We provide investors a secure online investor portal to access subscription documents, quarterly statements, fund financial information, investor updates, and tax documents.
How Do I Withdraw My Investment?
Every equity investment has a 12-month “lock-up” period where withdrawals are only allowed for hardships and early withdrawal fees may apply. After this “lock-up” period, investors may withdraw at any time with at least 60-day notice.
How is Risk Mitigated?
Management actively monitors our real estate debt fund and mitigates risk by deploying several strategies:
1. We maintain a diversified portfolio of loan types, loan purposes, and geographic locations in Oregon and SW Washington. Our loan types consist of residential and commercial loans with subtypes of new construction, rehab, acquisition and development, and bridge/term. We only finance business-purpose loans that provide funding for purchases, refinances, rehabs, new construction, and development.
2. The portfolio’s weighted average loan size is typically below $500,000, so our transactions are small. Therefore, the projects tend to be more resilient given the high demand for affordable housing and when faced with conditions that negatively affect the real estate market.
3. Generally, our loan-to-value (LTV) ranges are from 60-75% in Cetan Income Fund and 65-80% in Cetan Opportunity Fund, with a portfolio target of a weighted average LTV at 65% or less for Cetan Income Fund and 70% or less for Cetan Opportunity Fund. To determine value we complete an internal evaluation that uses a variety of sources, including an Automated Valuation Model, Broker Price Opinions, as well as our direct sourced market and comparable data. On properties with a unique purpose or for larger loans, we typically order appraisals.
4. Loans are typically secured with first position liens. Cetan Opportunity Fund may also selectively fund loans secured with second position liens.
5. In Cetan Income Fund, loan terms range from 6-36 months with the weighted average asset life in the loan portfolio target of 12-15 months. In Cetan Opportunity Fund, loan terms range from 6-60 months with the weighted average asset life in the loan portfolio target of 15 – 21 months.
6. We use leverage minimally as it is not a permanent funding strategy. Cetan Income Fund has a bank line of credit that is used to meet temporary liquidity needs but rests it at $0 frequently during the year. Cetan Income Fund also offers 6 to 36-month Promissory Notes to investors who prefer to loan their money to the Fund rather than invest in equity or wish to have a mix of both. Cetan Opportunity Fund, on the other hand, was recently launched in 2023 and does not currently use leverage or offer promissory notes to investors. Once the Cetan Opportunity Fund reaches $5 million in assets under management, we may establish a bank line of credit to use to meet temporary liquidity needs. Management will always limit leverage in both Funds to a maximum of 20 – 25% of assets under management.
Why Do Banks Not Make These Loans?
This is because of several factors, including regulatory constraints, banks’ large overhead expense making smaller loans unprofitable transactions, and obtaining a bank loan often takes too long, or the process of obtaining it is complicated and expensive.
Though the typical borrower is creditworthy, they are seeking a loan that is not readily available from traditional banks and credit unions. Cetan Funds addresses this credit and service void in the marketplace by taking reasonable risk while processing applications with speed, transparency, and accuracy.
What Distinguishes Cetan Funds From Other Non-traditional Lenders?
The Cetan Advantage is what sets us apart from other lenders. It provides borrowers superior lending experiences. As a result, our investors are well positioned to realize a positive investing experience as well. The Cetan Advantage embodies the following values:
- Expertise
- Partnership
- Efficiency
- Flexibility
- Integrity
How Are Returns Calculated and Earnings Distributed to Investors?
Both Funds fully distribute net income to all investors on a pro-rata basis quarterly. All investors are treated equally as we do not have a preferred return, classes of shares, or any other preferential treatment.
We close the accounting quarterly, derive the net income, and then our fund management software calculates the distributions to generate investor statements. Dividends may be withdrawn or reinvested in additional shares. Generally, it takes two to three weeks to close a quarter and distribute the earnings to investors.
Are Your Financial Statements Audited?
Yes, our financial statements are audited annually by a qualified CPA firm that specializes in private equity funds that include real estate debt funds and are posted for existing investors as well as available for interested investors.
What Type of Income Will My Earnings Be Considered?
Equity investors earn ordinary income and will receive a K-1 schedule for their tax returns. For IRA investors, Unrelated Business Taxable Income is generated but is limited to the amount of income that is generated from leverage; hence, it is a very small percent. Promissory Note investments in Cetan Income Fund generate interest income, so this income is reported on a 1099 INT statement.
None of the information herein is to be construed as a solicitation, recommendation or offer to buy or sell any security, financial product, or instrument. Any projections or targets are aspirational only, are not guaranteed, and do not reflect past or current performance. Any report of past performance is no guarantee of any future performance. As with any investment, an investment in the Company is subject to risks, some of which could be substantial. No investment should be made in the Company by any investor who cannot afford to lose their entire investment. There are also restrictions on re-sale of Company securities and no investment should be made by any investor who cannot afford to hold the investment in the Company for a long period of time. This investment is only allowed and suitable for certain kinds of investors, who must have their investment status verified and confirmed in writing. No investment may be made, and no investment will be accepted unless the Company has received and approved the required written verification of each investor’s status.