Luis Pazos 
As virtual investments like cryptocurrency grab headlines for their unpredictability, many people are looking for more stable ways to invest their money. Historically, real estate has been a reliable investment, but it’s often come with high barriers—until real estate crowdfunding platforms emerged.
What Is Real Estate Crowdfunding?
Real estate crowdfunding lets individuals pool their money to invest in property. These platforms allow investors to combine smaller amounts of money to invest in real estate they’d otherwise be unable to afford. Property owners benefit by receiving funds they wouldn’t get through traditional investing. This makes exclusive investments, usually reserved for the ultra-wealthy, accessible to all.
Investments in real estate crowdfunding can be in debt or equity. Equity investing means owning a piece of the property and earning income from rent or profits when the property is sold at a higher price. Debt investing involves loaning money to property buyers and earning a return in fixed increments based on the loan terms.
Who Should Consider Real Estate Crowdfunding?
Traditionally, real estate investing was limited to accredited investors—those meeting specific income or net worth criteria set by the SEC. To be accredited, you need:
- An individual income over $200,000 per year in the last two years and an expected similar income this year.
- A combined income of $300,000 with your spouse over the last two years, with an expected similar income this year.
- A net worth exceeding $1 million, excluding your primary home.
- An entity with at least $5 million in assets or all equity owners being accredited investors.
Being an accredited investor also means having the time, effort, and knowledge to manage a property and take on significant risks. While some crowding platforms still require accreditation, many do not, allowing anyone to invest in real estate without needing the previous time, effort, or patience.
Ready to start your real estate investment journey through crowdfunding? We’ve listed the top seven platforms for 2024, with options for every financial need.
Fundrise: Ideal for Beginners
Fundrise is perfect for newcomers to real estate crowdfunding. It’s also suitable for those looking for growth opportunities as they gain experience.
- Minimum Investment: Depends on the account level (Starter–$10, Basic–$1,000, Core–$5,000, Advanced–$10,000, Premium–$100,000)
- Fee: 1.0% annual (0.85% management, 0.15% servicing)
- Property Types: Apartment buildings, residential, and commercial properties
Pros:
- Multiple account levels to suit different needs
- More stable options compared to REITs or stocks
- Diversified portfolio strategy via Innovation Fund
Cons:
- High initial public offering (IPO) investment of $1,000
- Limited customer support
- Lack of clear fee transparency
Fundrise focuses on ease of use and cost-efficiency by using its own software for property management. With 330,000 investors, $7 billion in total asset transactions, and $194 million in net dividends, Fundrise’s tangible real estate investments offer a stable alternative to stock market-linked REITs. However, the platform has limited customer service and lacks clear fee information.
RealtyMogul: Best for Single Properties
RealtyMogul is great for accredited investors interested in single-property investments.
- Minimum Investment: $5,000 for individual properties and REITs
- Fee: Generally 1.0%-1.25% annually
- Property Types: Office, residential, single-family
Pros:
- Two REIT options focused on income and growth
- Available to accredited and non-accredited investors
- A+ BBB rating for trustworthiness
Cons:
- High minimum investment
- High management fees with limited transparency
- Illiquid investments
RealtyMogul was born from founder Jilliene Helman’s observations while working in wealth management. She found that the wealthiest clients were real estate investors who valued passive income. RealtyMogul now has over 245,000 investors and $5.5 billion in potential deals. While the initial investment is high, RealtyMogul is a trustworthy platform for those looking to invest in single properties or REITs.
DiversyFund: Best for Gradually Building a Portfolio
DiversyFund is geared towards non-accredited investors looking to grow their real estate portfolio over time.
- Minimum Investment: $500
- Fee: Not available on the website
- Property Types: Multi-family REITs
Pros:
- Low minimum investment
- Great for non-accredited investors
- Fully automated for ease of use
Cons:
- Limited investment choices
- Long investment timeline (at least five years)
- Lack of detailed information on the website
DiversyFund focuses on wealth-building and diverse portfolios for average investors. The platform is fully automated, making it easier for everyday investors to participate without needing a lot of capital or expertise. However, investments are generally long-term, and the website lacks detailed operational information.
Roofstock: Best for Single-Family Homes
Roofstock is ideal for accredited investors interested in single-family rentals.
- Minimum Investment: $5,000
- Fee: $500 or 0.5% of purchase price
- Property Types: Single-family rentals
Pros:
- Variety of ownership structures
- Managed by property managers
- IRA investment option
Cons:
- Long investment term (five years)
- Only available to accredited investors
- No mobile app
Roofstock simplifies single-family rental investing with various ownership structures and managed assets. Investors can use IRA as a title holder and leverage 1031 exchange programs for tax benefits. Though it requires patience for returns and is limited to accredited investors, Roofstock offers an effective way to enter the single-family market without property management hassles.
Cadre: Best for Multiple Investment Styles
Cadre is a versatile platform suited for varied real estate investments.
- Minimum Investment: $25,000
- Fee: Amount varies by investment
- Property Types: Apartments, hotels, industrial
Pros:
- Data-driven approach
- Wide variety of properties
- Greater liquidity than other platforms
Cons:
- High initial investment
- No 1031 exchanges
- Long waiting period for returns (three to eight years)
Cadre offers diverse investment opportunities using a data-driven approach to identify lucrative options. Investors can access property deals, Cadre Funds for diversification, and the Cadre Secondary Market for more liquidity. However, the platform requires a significant initial investment and a long-term commitment.
AcreTrader: Best for Farmland Investments
AcreTrader is perfect for those interested in farmland investments.
- Minimum Investment: $15,000-$40,000
- Fee: 0.75% asset management
- Property Types: Farmland
Pros:
- Highly selective farmland
- High returns (7.0%-9.0%)
- Self-directed IRA options
Cons:
- Unique farmland risks
- Long investment periods (five to ten years)
- Lack of liquidity
AcreTrader offers direct access to farmland investments through a selective process. Investors buy shares of farmland, expecting high returns. However, farmland comes with risks related to weather, crop seasonality, and government policies. The investments are long-term and illiquid, requiring a strong commitment.
Fund That Flip: Best for House Flipping
Fund That Flip is tailored for those interested in residential house flipping.
- Minimum Investment: $5,000
- Fee: 1.0%-3.0%
- Property Types: Single or multi-family residential
Pros:
- Up to 11% returns
- Rigorous underwriting process
- Fast funding with bridge loans
Cons:
- House flipping is risky
- High minimum investment
- Must be accredited
Fund That Flip rigorously selects projects managed by experienced redevelopers, claiming up to 11% returns. The platform also offers bridge loans for rapid funding. While house flipping carries significant risks, Fund That Flip mitigates some by handling the underwriting and project sourcing.
Other Platforms to Consider
- HappyNest: Allows anyone to join the real estate market with just a $10 investment. Unique for its net lease agreements.
- CrowdStreet: Offers various property investments but requires a high minimum investment of $25,000.
- PeerStreet: Specializes in real estate debt investing with a $100 minimum investment, but requires accreditation.
- EquityMultiple: Has a team of experts and user-friendly technology, requiring a $5,000 minimum investment.
- Jamestown Invest: Suitable for accredited and non-accredited investors with a $2,500 minimum investment for commercial properties.
Choosing the Best Platform
There are many real estate crowdfunding platforms to fit various investor profiles and goals. Each platform creates a more accessible real estate market, historically considered stable compared to other investments. While all investment carries some risk, real estate crowdfunding platforms have lowered the entry barriers, making it easier for anyone to invest.
Best Real Estate Crowdfunding Companies
| Company | Property Types | Minimum Investment | Annual Management Fees | Accredited Investors Only |
|---|---|---|---|---|
| AcreTrader | Farmland | $15,000 | 0.75% | Yes |
| Cadre | Apartments, hotels, industrial | $25,000 | Varies | Yes |
| CrowdStreet | Multifamily, retail, office, industrial, and land | $25,000 | Varies | Yes |
| DiversyFund | REITs | $500 | Not available | No |
| EquityMultiple | Commercial | $5,000 | 0.5%-1.5% | Yes |
| Fundrise | Apartment, residential, commercial | $10 | 1.0% | No |
| FundThatFlip | Single or multi-family residential | $5,000 | 1.0%-3.0% | Yes |
| HappyNest | Pandemic and internet-resistant businesses | $10 | 0.04% (monthly) | No |
| Jamestown Invest | Office, retail, and mixed-use spaces | $2,500 | Varies | No |
| PeerStreet | Real estate debt | $100 | 1.0% | Yes |
| RealtyMogul | Office, residential, single-family | $5,000 | Varies | Yes for single properties; No for REITs |
| Roofstock | Single-family rental | $5,000 | $500 or 0.5% of purchase price | Yes |
Have you tried investing in real estate crowdfunding platforms? What’s been your experience?
