Over the last few years, real estate prices have skyrocketed, leaving many hopeful investors feeling priced out of the market. In addition, many who once considered becoming real estate investors have realized that becoming a landlord can be overwhelming. It’s one reason that real estate crowdfunding platforms have grown in popularity in the last few years.
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| Alternatives to Fundrise: Seven Top Real Estate Crowdfunding Platforms to Consider |
When you think of crowdfunded real estate investing, Fundrise may come to mind. One of the first major players, Fundrise allowed investors to enter the real estate market without the hassle of going through the typical home-buying process. Over the last decade, many Fundrise competitors have popped up, and investors have more options than ever.
Why Is Fundraising So Popular?
Fundrise enables you to invest in real estate without making the typical 20% down payment, which is a significant financial commitment. Instead, you may begin investing in real estate for as little as $10. Real estate investing is no longer just for the wealthy. You also don't need to hire a broker or worry about getting caught up in a bidding battle.
Non-accredited investors can now invest through Fundrise. This allows you to test the market without making a large financial investment. Fundrise is a private real estate investment trust (REIT), which implies that shares cannot be purchased on a stock exchange. Instead, you may invest in funds that own commercial and residential real estate around the country.
Fundrise has five account levels:
- Starter. With this method, you may start investing in real estate for as little as $10.
- Basic. You may start your real estate investment journey just $1,000.
- Core. This is the $5,000 starting point.
- Advanced. This is for investors with a $10,000 deposit.
- Premium. The highest category is for real estate investments of $100,000 or more.
Our entire Fundrise evaluation may be seen here. While Fundrise is a legitimate and reliable platform for real estate investing, it is still vital to investigate alternative options before investing.
If you want to invest in crowdfunded real estate, these are the seven greatest Fundrise options.
1) CrowdStreet
CrowdStreet is a popular real estate crowdfunding platform and Fundrise's major rival. However, the firm focuses in commercial real estate for accredited investors with an annual income of more than $200,000 (or $300,000 for married people) and a net worth of $1 million (not including your primary residence).
To get started, CrowdStreet demands a minimum commitment of $25,000, whereas Fundrise requires only $10. You can, however, invest in direct marketplace deals or buy shares in commercial REITs. CrowdStreet also provides advising services, so you may work with a team to tailor your real estate portfolio with private deals.
CrowdStreet does not charge its investors any fees, and eligible individuals have additional alternatives. You may purchase REITs, bespoke portfolios, and individual transactions. CrowdStreet analyzes each project to ensure that only eligible offerings reach the marketplace.
CrowdStreet had sponsored over 661 deals and spent $4 billion as of August 2022.
2)RealtyMogul
With over 250,000 members and 33,000 investments, RealtyMogul concentrates on commercial properties. This Fundrise rival has been active since 2012, and members may invest in well-leased homes.
Anyone may invest in REITs with RealyMogul and receive passive income from a portfolio of income-generating properties. The minimum investment is $5,000, which is greater than Fundrise's $10 minimum but lower than the $25,000 requirement elsewhere. RealtyMogul provides two private REITs for non-accredited investors and private real estate investments for approved investors.
RealtyMogul, like CrowdStreet, has a rigorous verification procedure. This guarantees that the offers they provide have sufficient data to indicate the best possible possibility of a good return. More information may be found in our RealtyMogul review.
3) DiversyFund
DiversyFund is open to all investors. The platform is designed for persons interested in investing in apartment buildings and other multi-unit assets. DiversyFund offers over 100 units, and its REIT seeks rental revenue from inexpensive multi-unit properties.
DiversyFund is unusual in that they hunt for undervalued buildings and invest money in renovating them in order to increase the value of the property. The revenue generated by these properties is reinvested monthly in order to continue upgrading the property until it can be sold for a profit.
Once the transaction is completed, the profits and dividends are dispersed to the investors, who can accept the money or reinvest it in future projects with the firm.
To get started, you may invest in REITs for as little as $500, and there are no management fees. In only a few minutes, you may create an account on the website. DiversyFund is great for long-term investors since renovating properties before selling them for a better price takes time.
The DiverysFund mobile app allows you to manage your investments, set up automatic deposits, and learn about real estate investing.
4) Yieldstreet
An alternative investing platform called Yieldstreet allows investors access to a wide range of unusual asset classes. Private investment options include everything from fine art to multi-family buildings. Without requiring accreditation, you may invest as little as $2,500 in Yieldstreet's Prism Fund, or if you're an accredited investor, you can contribute $10,000 to create a unique portfolio. To make money for its clients, the Prism Fund makes investments in a variety of asset types, including corporate, consumer, legal, and commercial real estate. A 1.5% management charge is included.
For more experienced investors seeking for riskier businesses with the potential for bigger profits, Yieldstreet is the perfect platform. On the platform, you may examine several choices. For instance, at first look, we discovered a multi-family home in Portland that cost $10,000 to start and an art equity fund that costs $15,000 but offers you access to internationally renowned artwork.
With over $4 billion invested, YieldsStreet presently has over 400,000 registered members. The fees vary according on the asset class you're investing in. Options are available for both short-term and long-term enterprises.
5) HappyNest
Since its launch in 2017, HappyNest has served as a real estate investment platform for investors of all experience levels. You don't need to worry about investing a sizable sum of money or be an approved investor. To enter the real estate market without the hassle of managing several tenants, you may invest in this private REIT. Like Fundrise, you only need $10 to get going. HappyNest is simple to use for people who might be scared by the thought of entering into crowdfunded real estate investing thanks to the user-friendly smartphone app.
A round-up savings feature offered by HappyNest may be connected to a credit or debit card. It will round up to $8 and put $0.45 into a round-up pool if you spend $7.55 on lunch. When the total in this pool reaches $5, further shares are automatically purchased.
HappyNest is a more recent company, thus they lack the same level of track record as some of the other companies on our list. Furthermore, because they now only have one portfolio, they lack the wide variety of funds you might find elsewhere.
6) Streitwise
Dividend payments are the main way that Streitwise generates passive income for its clients. Considering that the company's funds have paid an average dividend of 9.2% since 2017, it promotes them as the best inflation hedge. When it comes to delivering dividends, Streitwise has a solid track record. Both accredited and non-accredited investors may use the site, but a $5,000 minimum commitment is required to get started.
To demonstrate to its clients that they have a stake in the outcome, the firm invests $5 million of its own money in these real estate deals. Streitwise stands out from the other companies on the list due to its history of dividend distributions.
Streitwise may suffer from the fact that it only provides one REIT, which focuses on commercial real estate and has a about $81 million market value. Streitwise also levies management fees at a rate that is greater than Fundrise, at 2%.
7) Roofstock.
Opportunities are available at Roofstock for accredited and non-accredited investors who want to start investing in real estate, with a focus on single-family rentals. To help you consider your alternatives, the website shows the single-family homes that they invest in. A solo 401(K) plan or a self-directed IRA are two options for investing.
You have the option of buying the whole house or just a portion of it. For accredited investors, the corporation also provides the "Roofstock One" REIT. You hold shares that reflect ownership in properly managed single-family residential units, making it special.
Before making an investment, you may learn as much as possible about residential real estate through Roofstock. This contains details on the surrounding area, the current lease, and floor layouts.
Roofstock also inspects each property to ensure that only the listings that have been authorized appear on the marketplace. To make sure your investment is passive, you may also engage Roofstock's property management staff.
The "Guaranteed Rent" policy of Roofstock is noteworthy. After the house is ready for renters, the organization guarantees that unoccupied homes will be rented out within 45 days.
Consider these notable Fundrise options as well:
- The good news is that there are a lot of additional options to consider as we couldn't list every crowdfunding platform due to the length of this article:
- EquityMultiple: You may invest in high-yield, well managed real estate projects for as low as $5,000.
- PeerStreet: This is the first marketplace where you may buy debt related to real estate.
- AcreTrader: You may purchase farmland with AcreTrader if you wish to diversify your real estate assets.
- First National Realty Partners: This marketplace provides accredited investors with access to properties with grocery stores as anchor tenants.
- Farmland: A $10,000 minimum investment is required to purchase farmland.
New real estate investing platforms are emerging over time. Everyone will soon have access to single-family, multi-family, and commercial properties.
Whether you're looking for single-family homes, multi-family homes, or commercial properties, there should be a choice that fits your needs.
The Last Word on Real Estate Investments Funded by Crowds
You may invest in real estate using our Fundrise substitutes without becoming a landlord. You may start with as little as $10 because there are platforms for any financial situation.
We strongly advise you to conduct further research before putting money in one of these sites. We place a high priority on fee transparency, especially if you're contributing a substantial sum of money to the project.
Because there are other investment alternatives accessible, you should be sure that your money is working for you. Therefore, take into account the platform's previous returns as well.
Select a real estate crowdfunding platform that meets your objectives in the end. There are several methods to invest in real estate, so you need make sure the platform supports your objectives.