Real Estate Crowdfunding
Are you interested in investing in real estate but not ready to take this step alone? Real estate equity crowdfunding might be just the ticket to help you get started. With as little as $10, you can invest in properties with the crowd – and begin the journey to real estate tycoon.
Explore the different companies below to find the right way for you to begin investing. Real estate is the same way that the world's richest have invested for centuries – so you don't want to miss it!
Prior to 2012, you could only invest directly in real estate through either purchasing real estate outright on your own, by making a private equity investment in a real estate development company, or with real estate investment trusts (REITs). None of these options were feasible for many individual investors. But as the crowdfunding movement blossomed, the 2012 Jumpstart Our Business Startups (JOBS) Act opened up opportunities for accredited investors. Then, in 2016, the JOBS Act was modified – allowing anyone to invest in specific opportunities.
Before you put skin in the game, take a close look at each of the companies in the table above and pay attention to their specific investment requirements. For example, many of these investments aren't liquid and often require you to tie up capital for a specified period of time, up to five years.
Some real estate crowdfunding sites only accept accredited investors. The Securities and Exchange Commission (SEC) is in the process of opening up real estate investments to non-accredited investors through investment avenues such as crowdfunding. Sites that accept non-accredited investors offer these opportunities to any investor, regardless of his or her annual income. The list above mentions sites like Fundrise and Groundfloor, which accept non-accredited investors, and set minimum investments at or below $100, making real estate investing far more accessible to investors of all types.
There are also sites, such as RealtyShares and PeerStreet, that are only open to accredited investors. This means that you can't participate with these platforms unless you can afford thousands of dollars in minimum investments and have either a net worth of $1 million or earn $200,000 ($300,000 combined, if married) per year for two years prior to investing.
Any investment you make will impact on your life and finances. Take your time and explore the various real estate crowdfunding platforms available. Happy investing!