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Real estate crowdfunding sites allow investors to come together to invest in real estate. Some work with investment funds, where a team of expert investors buys and manages a portfolio of real estate. Others offer investors a menu of direct real estate investments.
When you’re considering a real estate crowdfunding platform, it’s important to review factors such as past performance, investment strategies, and fees. You’ll also want to consider whether the platform requires you to be an accredited investor to participate.
Here are the best real estate crowdfunding sites so you can make the right choice for your portfolio.
The Best Real Estate Crowdfunding Sites
Fundrise
- Minimum Investment: $10
- Fees: 1% annual management fee
- Accreditation Requirement: None
Why we chose Fundrise. With a funding requirement of $10 and low annual fees, Fundrise represents one of the best real estate crowdfunding platforms. It allows you to invest in income-generating real estate for quarterly dividends, and more than 300,000 investors are currently using this crowdfunding platform.
There is also a secondary market for shares, which is not something you get from all crowdfunding sites. However, you must hold shares for at least five years if you want to avoid the pre-sale penalty.
Commissions. investors pay a total of 1% in annual management fees.
Get Started With Fundrise | Fundrise Review
CrowdStreet
- Minimum Investment: $25,000
- Fees: Approximately 2% to 5% for most deals
- Accreditation Requirement: Most deals require being accredited
Why we chose CrowdStreet? Another effective way to add real estate to your portfolio is to invest through CrowdStreet. We like this crowdfunding platform because it offers both private real estate deals and REITs if you want more diversification. You must be an accredited investor for most of the offers, but CrowdStreet has some of the best variety of offers in the competition.
Fees – You pay no annual fees with CrowdStreet, which is a plus. However, sponsors charge fees for investment opportunities that typically range from 2% to 5% per trade.
Get Started With CrowdStreet | CrowdStreet Review
RealtyMogul
- Minimum Investment: $5,000
- Fees: 1% annual management fee
- Accreditation Requirement: None
Why we chose RealtyMogul? Like CrowdStreet, RealtyMogul offers another easy way to invest in individual real estate deals or multiple REITs. And the $5,000 investment minimum is much lower, and their REITs are also open to non-accredited investors.
RealtyMogul’s REITs are one of their main selling points. It has an income REIT as well as an apartment growth REIT that investors can explore.
Fees: Annual management fees typically range from 1% to 1.25% for different transactions. You may also pay additional REIT fees.
Get Started With RealtyMogul | RealtyMogul Review
Streitwise
- Minimum Investment: $5,000
- Fees: 2% annual management fee
- Accreditation Requirement: None
Why did we choose Streitwise? If you are looking for dividend income, Streitwise is one of the best real estate crowdfunding sites you can use. It offers private REITs starting at a minimum investment of $5,000 and has paid an average annual dividend of 9.2% since the start of 2017.
Streitwise is also open to non-accredited investors, which is an advantage. You are paid quarterly dividends and overall, Streitwise is a popular inflation investment as you can potentially hedge against inflation while generating quarterly income.
Fees: You pay 2% annual management fees with Streitwise.
Get Started With Streitwise | Streitwise Review
EquityMultiple
- Minimum Investment: $5,000
- Fees: Typically 0.5% to 1.5% in annual fees
- Accreditation Requirement: Yes
Get Started With EquityMultiple
Why we chose EquityMultiple. EquityMultiple is another leader in real estate crowdfunding. As for why it made our list, EquityMultiple has a variety of equity, preferred equity and debt-based deals to choose from. It also targets high-yield plans that are professionally managed and, according to its website, has seen a historical net return of 18.7%.
There is a minimum investment of $5,000 and you should be in good shape. But many deals also have short target dates, so it can be a viable short-term investment, which isn’t always viable in real estate.
Fees: You typically pay 0.5-1.5% per year for equity investments and about 1% for debt investments. You also get 10% of all profits.
Get Started With EquityMultiple | EquityMultiple Review
Roofstock
- Minimum Investment: $
- Fees: 0.5% or $500
- Accreditation Requirement: None
Why we chose Roofstock? If you’ve ever wanted to become a homeowner, Roofstock could be the solution you’ve been looking for. It allows you to invest in single-family rental properties, while most crowdfunding platforms focus on commercial real estate or multi-family housing. This allows you to invest in rentals that generate income, and you can even have Roofstock manage the property for you through a network of property managers to keep things passive.
There are no minimum investment or accreditation requirements. However, financing terms will likely require a decent amount of down payment in the 20%-30% range, so keep this in mind.
Fees: Roofstock charges investors $500 or 0.5%, whichever is higher.
Get Started With Roofstock | Roofstock Review
Origin Investments
- Minimum Investment: $50,000
- Fees: Management fees of 1% to 2% plus administrative and acquisition fees
- Accreditation Requirement: Yes
Get Started With Origin Investments
Why we chose Origin Investments? If you’re looking to invest $50,000 or more in private real estate funds, Origin Investments is one of your best options. This real estate crowdfunding platform is open to accredited investors and has a variety of funds including growth funds, income generating funds and debt-based funds.
According to its website, Origin Investments has seen an average gross internal rate of return (IRR) of 24%. If you are looking for some tax-advantaged real estate funds to invest in and are accredited, Origin Investments is worth considering.
Fees: Origin Investment charges a one-time administration fee of up to 2%, a management fee of 1% to 2% and a one-time acquisition fee of 0.50%. The amount you pay for administration fees depends on how much you have invested.
Get Started With Origin Investments | Origin Investments Review
Arrived Homes
- Minimum Investment: $100
- Fees: 1% annual management fee
- Accreditation Requirement: None
Get Started With Arrived Homes
Why did we choose the houses that arrived? Despite being a newer player in the world of real estate crowdfunding, Arrived Homes had to be on our list of best sites. That’s because it allows anyone to invest in income-generating residential real estate starting at just $100. It’s also completely passive, as Arrived Homes works with contractors and property managers to manage the rental units.
We really love Arrived Homes because it also allows renters to invest in their homes to become co-owners. This means that tenants are often interested in maintaining the property, which reduces repair costs. To date, the platform has paid annual dividends between 3.2% and 7.2%. However, this does not take into account the possible appreciation of the property, as the company started in 2019.
Commissions. You pay 1% annual management commissions as an incoming home investor. There is also a one-off supply fee that Arrived Homes charges and the listings describe what this fee is.
Get Started With Arrived Homes | Arrived Homes Review
What To Know Before Investing in Real Estate
When you invest in the stock market, you are betting on the financial success of that business and its ability to generate profits for years to come. When investing in real estate, each property is its own business in a way. Each property has its own risks, cash flows and appreciation prospects.
Every real estate market is unique and every investment opportunity different. Two identical buildings will see different results in different cities. Market demands, interest rates and tenants are just a few of the complex factors that lead to the success or failure of an investment property.
How To Choose a Real Estate Crowdfunding Site
Every real estate crowdfunding app has a similar goal to help you get a high return on your investment. However, different strategies, fee structures and investor requirements may force you to choose one platform over another. These are the most important criteria to consider when choosing a real estate crowdfunding platform:
- Requirements for accredited investors. Some real estate crowdfunding services require you to be an accredited investor. That means having a household net worth of at least $1 million, excluding your primary residence, or an annual income of at least $200,000. You can read our guide to the best real estate investment sites for non-accredited investors if you want to narrow down your options.
- Minimum investment. some platforms allow you to invest as little as $10, while others require $100,000 for some investments. The size of your investment may dictate which platform you choose.
- Investment strategy. Each real estate crowdfunding service has its own philosophy and investment strategy. Some offer funds that are often structured as real estate investment trusts (REITs). Others give you direct investment opportunities. And, increasingly, they can focus on different types of assets, follow a single allocation strategy and a debt or equity approach that impacts long-term results.
- Management Fees – It is reasonable to pay a company to select properties and manage them. But you don’t want to give up most of your investment income for fees.
- An investment period is required. unlike the stock market, real estate crowdfunding investments can take years before you can sell. If you need the money sooner, real estate crowdfunding may not be the best option.
- Risk. All investments carry some level of risk. Take the time to evaluate risk and potential return to determine whether investments are consistent with your overall portfolio strategy and risk tolerance.
Learn more >>> Real Estate Debt or Equity Crowdfunding. which one is right for you?
How We Chose the Real Estate Platforms on This List
To narrow down the best real estate apps, we take a look at the real estate crowdfunding industry, looking at a number of features and statistics. Among the most important considerations were accreditation requirements, minimum investment requirements, pricing and fees, past performance and available investments.
Please note that real estate platforms may change their rules at any time. And past performance is no guarantee of the future.
The real estate market has unique risks and opportunities. So while it may be a great option for many investors, it may be a bad option for others. Before investing your own money through this or any other real estate crowdfunding platform, it is wise to spend time reviewing costs, investment strategies and investor requirements.
Final Thoughts
Investing in real estate used to be limited to wealthy owners who could afford individual investment properties. But real estate crowdfunding platforms bring many benefits of real estate investing to the masses, including non-accredited investors. If you understand the potential risks and rewards, a real estate crowdfunding site may be the best way to get started.