10 Best Crowdfunding Real Estate Platforms
Some products in this article are from our partners. Read our Advertiser Discloser.
If you don’t have the time, skills, or cash to own a rental property, investing through a crowdfunded real estate site can give you the opportunity to do so without all the headaches.
In addition, your investment might earn a 12% yield while the average historical return for the broad stock market is approximately 8%. This article will help you find the best crowdfunded real estate companies to help you choose the best platform.
Table of Contents
Top Crowdfunding Real Estate Sites
There are roughly 100 different crowdfunding real estate sites you can invest with, but that doesn’t mean they’re all excellent opportunities.
Before giving your business to just any company, try the following recommendations. You can also open an IRA with many of these companies, which can help minimize your tax bill.
1. Groundfloor
Groundfloor allows both accredited and non-accredited investors. This company focuses on debt investments instead of equity investments. They introduced a new Groundfloor mobile app that is available via the Apple App Store and Google Play Store for easier access.
Borrowers borrow funds to refinance or rehab residential real estate properties. The borrowed funds are invested through crowdfunded real estate fundraising. Potential investments are graded A through G so investors can decide the level of risk they want to take.
Most investments through Groundfloor are short-term–no longer than 12 to 18 months and sometimes even shorter. Groundfloor has a minimum investment amount of just $10. And there are no fees for investing with Groundfloor.
The Groundfloor website says the company’s average return on investment over the past six years is 10%.
Learn More: Groundfloor Review
2. CrowdStreet
CrowdStreet invests in commercial real estate, and most investments have a minimum $25,000 investment. You might like CrowdStreet because it focuses solely on commercial real estate, unlike other platforms that invest in residential properties.
This allows CrowdStreet to be one of the few crowdfunded companies that let accredited investors invest directly in commercial real estate. Although other crowdfunding platforms invest in commercial real estate, you still invest through the lender or managing company with them.
Being a direct investor offers higher income potential, as you can easily find deals with a minimum projected yield of 20%. Of course, this also means potentially higher risk since the investing company cannot use other investment assets to offset losses.
CrowdStreet has a 5% acceptance rate for borrower applications. Most crowdfunding platforms have a 5% to 10% acceptance rate.
Learn More: Crowdstreet Review
3. Fundrise
If you’re a non-accredited investor, Fundrise might be your best option. Unlike other crowdfunding platforms, investors are welcome from all 50 states.
To create your starter portfolio, you only need to invest $10. Fundrise invests your money in a basket of commercial and residential properties across the United States.
Some of the current property types include:
- Apartment development and renovation
- Rent-stabilized apartments
- Home construction
- Commercial developments
Additionally, you don’t experience the daily stock price fluctuations that are common with publicly traded REITs. You can unlock advanced strategies with a minimum investment of $10,000 or $100,000. These curated portfolios may focus on a specific real estate market or property type.
Learn More: Fundrise Review
Note: We will get a commission if you sign up through this endorsement of Fundrise. However, we only promote brands we believe are a good fit for our readers. All opinions are our own
4. DiversyFund
DiversyFund is another crowdfunded real estate platform open to all investors. You can invest in both its private growth and income REITs.
The DiversyFund team is based in California, and they invest in what they know best, commercial real estate. You can invest in one of the DiversyFund REITs with a minimum investment of $500. Investing in individual properties requires a larger initial investment.
5. PeerStreet
PeerStreet specializes in debt investment loans for accredited investors. Most loan terms last six to 36 months, and returns range from 6% to 9%. You can consider using PeerStreet for your short-term investments in residential properties.
It’s also possible to invest in commercial and multifamily deals. While most crowdfunded companies charge an annual 1% administrative fee, PeerStreet charges between 0.25% and 1% for each investment, making it a low-price leader.
Another reason to consider PeerStreet is its automated investing feature. You can create investing screens that filter open opportunities by several factors:
- Property type
- Loan maturity date
- Geographic region
- Borrower
As you await new investment opportunities, you can stash your uninvested cash in a PeerStreet Pocket account. This high-yield savings alternative earns a competitive interest rate that can be higher than online banks.
6. HoneyBricks
HoneyBricks invests in real estate differently than other companies we’ve mentioned here. With HoneyBricks, you purchase real estate tokens representing real fractional ownership in high-quality commercial real estate.
You can purchase HoneyBricks tokens with crypto, fiat (USD), or stake your current crypto holdings. There are several benefits to investing in tokenized real estate through HoneyBricks, including lower transaction fees, tax advantages through direct ownership, and improved liquidity.
HoneyBricks is building a secondary market allowing token holders to sell their tokens once they meet minimum holding periods. Although HoneyBricks’ revolutionary technology is one of its most obvious key differentiators, its approach to real estate is also world-class.
Their investment team has invested over $5 billion across 1,000’s of real estate assets throughout the US. Each property is comprehensively vetted, and only <1% make it onto the marketplace.
7. HappyNest
Happy Nest makes commercial real estate investing possible for the ‘everyday investor.’ You only need $10 to get started, eliminating all excuses for not investing in real estate. While the returns aren’t typically as high as those on some other crowdfunding platforms, Happy Nest targets a 6% average return and pays monthly dividends.
What we love most about Happy Nest is the ability to automatically round up your purchases to invest. This way, investing in real estate requires little effort yet has the potential to provide decent returns.
Happy Nest doesn’t charge a monthly or annual fee; however, they aren’t 100% transparent about the fees charged per listing, which can be a downside.
8. Arrived Homes
Most crowdfunding websites focus on commercial real estate, but Arrived Homes differs. Investors using this platform can invest in residential properties without becoming landlords. With a low $100 minimum investment, it’s an excellent way for anyone to start investing in residential real estate.
Arrived Homes started in 2019 and has almost 100 properties in its portfolio, worth $29 million. The platform is user-friendly, and you choose the homes you want to invest in yourself. There’s no guarantee that the homes you choose have tenants in them yet, though, so you may not earn dividends immediately.
Unlike other platforms that pay monthly, Arrived Homes pays quarterly dividends, so you’ll receive a payout (if there are tenants) every three or four times a year.
Arrived Homes charges a 1% annual assets under management fee plus a sourcing fee, which they detail in their listing.
9. RealtyMogul
RealtyMogul has a platform for accredited and non-accredited investors. Accredited investors can invest in individual commercial and residential properties, which include mobile home parks.
Another option for both accredited and non-accredited investors is to invest in one (or both) of RealtyMogul’s REITs. The Income Reit (formerly MogulREIT I) focuses on debt investments that pay a fixed monthly dividend.
But if you can invest for at least three years, you might want to consider the Apartment Growth REIT (previously MogulREIT II). It has more upside potential as investment properties appreciate in value and generate more income. But first, you must wait for property values to increase and sell for a profit.
The tradeoff is that you receive a smaller monthly dividend in the meantime. The minimum initial investment for each REIT is $5,000. Subsequent investments must be at least $1,000 at a time.
Learn More: RealtyMogul Review
10. EquityMultiple
Accredited investors can invest in debt and equity offerings on EquityMultiple. It approves less than 10% of borrowing requests to ensure no loan application will default. You can browse the open and closed listings to get an idea of their opportunities.
Some of the property types include:
- Hotel
- Office
- Multifamily apartments
- Condos
- Self-storage facilities
- Student housing
- Industrial properties
One recent closed offering was a 16-home residential subdivision in Kahuku, Hawaii. This proposal had a 12-month term with a 10% income rate. The offering proposal includes two proposed house drawings and more information about the lender and borrower.
The minimum investment is different for each offering type:
- Short-term notes: $5,000
- Individual properties: $10,000
- Managed funds: $20,000
How Do These Crowdfunded Real Estate Sites Compare?
| Company | Non-Accredited Investors | Min To Invest |
| Diversyfund | Yes | $500 |
| Groundfloor | Yes | $10 |
| CrowdStreet | No | $25,000 |
| RealtyMogul | Yes | $5,000 |
| Fundrise | Yes | $10 |
| PeerStreet | No | $1,000 |
| EquityMultiple | No | $5,000 |
| Sharestates | No | $1,000 |
| AlphaFlow | No | $10,000 |
| HoneyBricks | No | $1,000 |
Summary
Anybody in any income bracket can now invest in crowdfunded real estate. It can be an effective way to earn steady passive income while avoiding stock market volatility.
Crowdfunded real estate deals require a longer investment horizon than publicly traded REITs. However, investors can easily access real estate deals that cost a small fortune.
Recommended Reading