7 Best Real Estate Crowdfunding Platforms for Investing in 2023
See how you can become a property baron, investing in real estate with the click of a button.
Online marketplaces are open for real estate investments.
It's not necessary to aspire to own a magnificent building in New York. The idea of real estate ownership has been broadened to provide small (and large) investors with the freedom to select the area and kind of investment property for their portfolio. Real estate investors had two options prior to the implementation of the Jumpstart Our Business Startups Act in 2013: they could either purchase publicly traded REITs or acquire real estate outright. Since then, the world of crowdfunding, where individuals combine their funds to purchase multifamily properties, commercial real estate, or collections of single-family houses, has taken off.
An investment platform called a real estate crowdfunding platform enables regular people to make investments in real estate investment assets that are often only available to the wealthy. These platforms make real estate investing more accessible. The seven best real estate crowdfunding platforms.
Fundrise
Beginners can invest in private real estate on Fundraise without needing any kind of credentials. Value investing is the method used by Fundrise, which offers eREITs—a name that has been trademarked for the kind of REITs that the company provides—and invests in assets that gain value over the long term. Investors contribute an annual investment advisory fee of 0.15% to the operation and management of the platform; other charges may be due. With its "Starter Portfolio," Fundrise only needs $500 to get started investing.
If you decide to invest additional money over time, you can transfer it to a higher-level of account. The Fundrise team locates, acquires, and manages a diverse portfolio of American real estate projects in exchange for your investment. Then, as your investment shares increase in value over time, you can be compensated through quarterly dividend distributions and investment appreciation; dividend payouts aren't always guaranteed.
CrowdStreet
An online commercial real estate investing platform called CrowdStreet is primarily available to accredited investors in real estate. Each investment opportunity has a different minimum investment requirement, although most on this site have a $25,000 minimum. Several asset classes include hospitality, business, industrial, multifamily, retail, and self-storage. Investors can find discerning, institutional-style investing possibilities with CrowdStreet.
Only a small percentage of deals make it to CrowdStreet's marketplace, claims the company's website. "Everywhere in the U.S., our Capital Markets team is actively seeking out the finest sponsors and the best offers. There are thousands of discussions and hundreds of formal reviews, but only approximately 5% of those agreements ever make it to the CrowdStreet Marketplace "explains Tore Steen, co-founder, and CEO of CrowdStreet. According to CrowdStreet, as of February 2022, their online crowdfunding platform had raised more than $1 billion for agreements involving commercial real estate.
PeerStreet
Real estate investors and lenders can collaborate to create real estate loans through the PeerStreet marketplace. Accredited PeerStreet investors can open PeerStreet Pocket accounts with a minimum initial deposit of $1,000. Similar to investing in stocks, PeerStreet customers can pick and choose which properties to fund and create a unique portfolio of real estate lending. PeerStreet arranges loans for retail and institutional investors by obtaining loans from its network of private lenders and brokers. PeerStreet had completed deals worth more than $3.5 billion as of February 2022.
RealtyMogul
Both accredited, and nonaccredited investors can purchase commercial real estate deals through RealtyMogul that resemble those offered by institutions. RealtyMogul employs a conventional growth strategy appropriate for "buy and hold" real estate investors seeking to make investments in properties such as office, retail, and apartment complexes, among others, in order to produce passive income. The RealtyMogul team is made up of seasoned experts with backgrounds in finance, technology, and real estate.
The platform also provides public, nontraded REITs called MogulREITs for income and growth in addition to investing in individual properties. According to Jilliene Helman, CEO of RealtyMogul, "accredited and nonaccredited investors may invest as little as $5,000 in the platform's diversified REITs, including a multifamily-focused fund." In commercial real estate assets worth more than $2 billion, the corporation has invested more than $500 million.
EquityMultiple
A platform for investing in commercial real estate, EquityMultiple, offers cumulative historical returns of more than 14%. According to the company's website, EquityMultiple only chooses 5% of the assets it underwrites and assesses.
Investors can enter the private market for commercial real estate and make investments in properties that are expertly managed for as little as $10,000. According to Charles Clinton, CEO and co-founder of EquityMultiple, "Our team takes a bottom-up approach on every deal, working on behalf of our investors to mitigate unforeseen risks, protect the principal, communicate with the sponsor and any other stakeholders involved, and ultimately pursue the best returns. For each investment property, the platform of the organization offers reporting and analytics along with investment prospects.
DiversyFund
The Growth REIT, which invests in multifamily real estate, is a product offered by DiversyFund, an online platform for real estate investing. The investment fund employs a growth strategy meant to increase wealth in around five years. You are able to gain access to, invest in, and keep track of active real estate developments with a $500 minimum investment. DiversifyFund is both the creator and sponsor of this platform. Its REIT purchases and renovates multifamily properties with up to 200 units all throughout the United States. The value of the property rises with time. DiversyFund will sell the assets and liquidate them for investors when the property has been sold.
Yieldstreet
Individual investors now have access to alternative investments that were previously only available to a tiny number of investors, thanks to Yieldstreet. Investors can increase wealth and produce passive income by diversifying their portfolio with alternative assets in a variety of asset sectors, including real estate. Commercial real estate accounts for over 30% of Yieldstreet's committed (assets under management) assets as of January 2023, according to Mitch Rosen, senior director and head of real estate in New York City.
On Yieldstreet, you have a variety of investment options according to your preferences and level of experience. Investors can pool a minimum of $1,000 to participate in its multiasset class vehicle, the Yieldstreet Prism Fund. In one investment option, according to Rosen, this fund offers investors a diversified allocation across the numerous assets Yieldstreet makes.
Over 50% of first-time investors on the site, according to Yieldstreet, put money into the Prism Fund. Accredited investors normally need a minimum of $5,000 to start their own personalized portfolio.
The top real estate crowdfunding platforms:
- Fundrise
- CrowdStreet
- PeerStreet
- RealtyMogul
- EquityMultiple
- DiversyFund
- Yieldstreet