Real estate is shaking up investment portfolios. It’s a great way to invest and access opportunities that may not have been available before.
Andrew Carnegie said that most millionaires created their wealth by owning real estate. He believed that real estate was the best way to build wealth. If you only have $5000 to invest, you are locked out of this amazing wealth-building strategy that can fast-track you to financial freedom. It is now possible to make investments with as little as $500 with the emergence of online trading.
Anyone can now invest in real estate through real estate crowdfunding platforms. Real estate crowdfunding platforms allow investors to invest in real estate without the hassle and expense of traditional methods. You can invest in real estate with other investors for as little as $500. This is a great way to take advantage of larger investment opportunities.
There are merits and downfalls to each platform. How do you find a good site?
We tested more than 50 different sites and narrowed it down to the best of them. It’s off to a great start, so you can rest easy.
12 Best Real Estate Crowdfunding Sites & Platforms
Here are the top picks for real estate crowdfunding platforms you can invest with today:
- Fundrise
- RealtyMogul
- Roofstock
- Crowdstreet
- Peerstreet
- EquityMultiple
- Alpha Investing
- RealCrowd
- AlphaFlow
- 1031 Crowdfunding
- Patch Lending
- DiversyFund
1. Fundrise
- Accredited Investors Only: No
- Minimum Investment: $10
Fundrise is a real estate platform. They provide access to real estate investing through eREITs and eFunds, which are essentially diversified portfolios of private real estate assets throughout the United States. eFunds and eREITs allow investors to invest in a broad range of properties, allowing them to increase their return on investment.
Even better? Fundrise has a low minimum investment of $10 for some of the listings on the site. The platform is perfect for people just getting into real estate investing and people with small amounts of capital to invest. The platform offers more advanced options and strategies for those with larger amounts of capital to invest.
Fundrise has a quiz that will help you pick the right investments and plans for your financial needs. You will be able to assess the different types of investments and decide which one is right for you. If you are new to the real estate investing world, you should check out this platform. It’s a great way to learn how to invest in real estate without taking on too much risk.
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2. RealtyMogul
- Accredited Investors Only: No
- Minimum Investment: $1,000
RealtyMogul is one of the first companies to enter the real estate crowdfunding market. There are a lot of things on the platform, from mobile homes to multi-family condo buildings. You can find the perfect property on the platform. They have a minimum investment of $1,000 on most offerings. It’s easy for people with limited funds to start investing.
Anyone can invest on the platform, but only if they meet the income requirements of $200,000 per year or more.
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3. Roofstock
- Accredited Investors Only: No
- Minimum Investment: $5,000
Roofstock is the first and #1 online marketplace for those interested in investing in single-family rental homes. The Roofstock platform makes it easy to find and purchase cash-flowing rental investments, while providing access to trusted local professionals who can help with property management and other services.
Roofstock has overseen over $1 billion of completed transactions. The trust investors have placed in Roofstock’s capabilities is reflected in their success.
Roofstock wanted to create an online platform that would simplify the process of investing in real estate.
Roofstock makes first-time real-estate investors feel comfortable. The platform makes it easy for investors to make decisions about their investments. Roofstock is an attractive option for real estate investors.
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3. Crowdstreet
- Accredited Investors Only: Yes
- Minimum Investment: $25,000
CrowdStreet gives investors direct access to institutional-quality commercial real estate opportunities. CrowdStreet gives investors the chance to invest in a range of income- producing CRE opportunities. Retail, office buildings, and multi-family condo buildings are some of the projects on the website. It has experience in medical and educational facilities.
The platform gives you all the online tools you need to invest in real estate. It’s easy to use and provides a streamlined way to manage your investments. Their well-designed platform makes it easy to view all active offerings, as well as projected returns and other related documents. It allows investors to make quick decisions, so they can track their accounts in real time. E-sign the required documents and send your investment when you are ready. All the details of your investment will be included in the confirmation email.
CrowdStreet was historically an accredited investor-only platform, but that changed in August 2017 after the platform announced its first offering for non-accredited investors.
Each offering on the site has its own minimum investment. It is important to research each option before making a decision. A $5,000 minimum investment is the lowest we have seen, and a $50,000 minimum investment is geared towards professional investors. There are multiple options that fall in the middle for those looking for a more moderate investment.
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4. PeerStreet
- Accredited Investors Only: Yes
- Minimum Investment: $1,000
You will invest in single- family projects like homes and storefronts, because PeerStreet focuses on residential debt. PeerStreet has developed a platform that allows investors to invest in high-yield investments backed by real estate. Occasionally, they get a condo building or other multi- family real estate project. These projects are attractive to savvy real estate investors because they give investors a higher return on their investments.
The platform gives the platform to get the funding. By joining the platform, borrowers can find a variety of loan options in one location. Excellent management and transparency is what it gets high marks for. The company’s commitment to ethical practices has contributed to its success.
A $1,000 minimum investment is required to invest in PeerStreet. According to their team, you can find loans with 6-36 month durations and returns of 6-9%. The terms may be different depending on the loan originator. The platform is perfect for those just starting out. It is easy to use and even a beginner can become an expert.
6. EquityMultiple
- Accredited Investors Only: Yes
- Minimum Investment: $10,000
EquityMultiple focuses on professionally managed commercial real estate investments. EquityMultiple gives investors access to high quality opportunities in commercial real estate. One of the few platforms that offers investment options of equity, preferred equity, and senior debt is this platform. It allows investors to invest in multiple asset classes.
You can invest through several different accounts with EquityMultiple. You can choose from three different investment strategies.
EquityMultiple gives you a lot of flexibility as an investor. The company has excellent customer service and complete transparency. Every step of the way, the company is committed to providing an unparalleled customer experience. In June of 2022, EquityMultiple had returned $240.3 million to investors. Since its inception, EquityMultiple has provided investors with attractive returns. EquityMultiple is only open to accredited investors with a minimum investment of $5,000, so it is not the best choice for beginners. It is important to do your own research before investing.
7. Alpha Investing
- Accredited Investors Only: Yes
- Minimum Investment: $10,000
Alpha Investing provides a concierge service, giving you direct access to a private manager, and exclusive access to real estate crowdfunding awesome deals. Alpha Investing’s model is designed to make it easier for the average investor to invest in real estate.
Each investor has direct contact with the firm’s principal, so the concierge service is special. This means that investors have access to support that is tailored to their needs. If you have questions or need clarification on an investment, these principals are available to speak directly about it.
Alpha Investing is exclusive to accredited investors and requires a phone interview before you can invest. Don’t sign up for an interview if you don’t meet all the requirements. Before applying, it is important to read through the job description thoroughly.
8. RealCrowd
- Accredited Investors Only: Yes
- Minimum Investment: $25,000
RealCrowd connects investors with projects backed by large real estate funds and syndicators. Many of the listings on the platform are commercial, for example, they currently have a number of hotels seeking investment on their platform. These investments are low-risk and offer high returns, making them a great opportunity for savvy investors.
The company has high minimum investments. Before making any investment decisions, it is important to research the company thoroughly. Minimums range from $25,000 to $50,000, and the site is geared towards accredited and institutional investors. This site is a great place to invest for most investors.
RealCrowd focuses on long-term investments. Many of their offerings have hold times over five years, making this a great long-term opportunity for passive income with high returns.
9. AlphaFlow
- Accredited Investors Only: Yes
- Minimum Investment: $10,000
Are you interested in investing in multiple real estate offerings at the same time? Investing in a variety of real estate projects can help spread risk and maximize potential returns. If so, AlphaFlow is just what you need. AlphaFlow will invest your money for you into multiple offerings on its website if you make one investment.
AlphaFlow is a personal investor for real estate investments. Anyone can take advantage of high-return real estate investments without the hassle of managing them on their own. The platform will invest your money across a minimum of 75 real estate offerings around the web, so you will make maximum returns and substantially reduce risk. This strategy ensures that your money is diversified and invested in a variety of different assets so that you can generate the highest possible returns.
The platform has a good track record. It is an attractive option for businesses because it has been gaining traction in recent years. AlphaFlow has a portfolio of over 700 investments. The portfolio is expected to grow over the next few months. states. Considering you are investing in multiple properties at the same time, it has a net return of 8.40%. This type of real estate investment can be used by anyone looking to maximize returns.
10. 1031 Crowdfunding
- Accredited Investors Only: Yes
- Minimum Investment: $25,000
1031 Crowdfunding is a newer competitor in the real estate crowdfunding space. Their offerings include retail, hotels, and even self-storage. Their commitment to creating a diverse range of properties is reflected in the residential projects in their portfolio. Multi- family homes are also available for investment. There are many types of real estate investments, from single- family homes to commercial properties.
The team at the platform has over 60 years of experience in the industry, and they vet all investments on the platform. They have raised over $1 billion and have over $2 billion in real estate transactions. Since its inception in 2012 the company has grown rapidly.
What distinguishes 1031 from the rest of the portals? There is a second product called 1031 Insurance. It is designed to protect your investments and give you peace of mind. You can use this platform to make sure that all of your exchange funds are invested in a replacement property rather than taxed for capital gains. This platform can help you make the most of your exchange funds.
Why pay taxes when you can keep your money working for you? Before making a decision about not paying taxes, be sure to consult a financial advisor.
11. Patch Lending (formerly Patch of Land)
- Accredited Investors Only: Yes
- Minimum Investment: $5,000
Patch Lending is a real estate platform for everyone. They have low minimums for accredited investors who are just starting to invest in real estate. Guidance and support throughout the entire process is provided by them. The loan duration for most investments is 12 to 24 months. Longer loan durations can be provided by some investments.
There is a focus on single-family homes in big cities and tourist-focused areas like Chicago, New York City, and even smaller cities in Hawaii. Patch has a variety of options to fit any budget and lifestyle, so you’re sure to find the perfect home for you.
All of the platform’s deals are thoroughly reviewed by the company’s underwriters before being listed, so you can invest without worry. The platform gives investors detailed information about their investments. All of Patch Lending’s active offerings are co-funded to provide that extra confidence boost. Patch Lending is committed to providing a safe and secure investment experience for its clients, with every loan carefully vetting before launching on the platform.
12. DiversyFund
- Accredited Investors Only: No
- Minimum Investment: $500
DiversyFund has broken the mold when it comes to fees. It is an alternative for investors who want to access the same investment opportunities as high net worth individuals. Why? They don’t have any. They need to rely on other sources for their food needs. The other top companies charge account fees. It’s important to be aware of account fees when making investment decisions. You can invest $500 in real estate. You don’t need a lot of money to start investing in real estate.
DiversyFund has an investment strategy that I love. They only invest in one type of property. It’s a niche they know well and has served them well over the years. Why is that important? It helps us exercise our agency in a way that has positive repercussions for ourselves, our communities, and the world around us. It is one of the safest types of commercial real estate. It provides a great opportunity for investors to make money.
DiversyFund goes one step further. DiversyFund makes it easy for anyone to become an accredited investor because it has a lower barrier to entry. They look for properties that need work. In order to increase their value, they typically make improvements to the properties. Don’t worry. We are not talking about foreclosures. We are talking about ways to help homeowners stay in their homes. They might need a new roof, updated bathroom or a fresh coat of paint. They may need to replace the windows as well.
The properties have to be cash flow positive and in a high growth area. The properties have the potential for strong capital growth. They use technology to find properties that fit. Detailed analysis and financial forecasting can be provided by their software once the properties are found. After a site visit, if the properties are approved, they do the upgrades,
DiversyFund can increase rents for new tenants with improved properties. Rents increase property values. When rents increase, it can be beneficial for landlords and homeowners. When the properties are sold, investors make more money. Real estate tends to appreciate over time, which increases its value.
How Real Estate Crowdfunding Works
Crowdfunding is a way for businesses to raise money. Crowdfunding is a great way for businesses to raise capital that may not be available through traditional sources. Businesses can raise large sums of money if they reach a large audience of smaller investors. They can achieve their goals more quickly if they grow their operations.
Crowdfunding offers easier access to capital for the company than convincing a bank or single investor to give them the full amount, and it also lets everyday people invest small amounts of money while still becoming shareholders. Crowdfunding allows the company to build a community of engaged shareholders who can provide valuable feedback and help spread the word about the business.
The implications for the small-time investor are huge. Small-time investors have a better chance of making a profit in the stock market. It allows them to invest in big-money projects like real estate and open the potential of enormous returns if the company they choose is successful and eventually goes public. There is a chance for investors to get in on the ground floor of a potentially successful company if they invest in private companies through equity crowdfunding.
How Real Estate Crowdfunding Began
In 2012, the Jumpstart Our Business Startups (JOBS) Act was signed into law. Small and mid-sized businesses were able to crowdfund their capital needs. Businesses were able to pursue their goals without relying on traditional sources of funding.
Originally, because of the inherent risks of putting money into relatively unknown companies, the Securities and Exchange Commission (SEC) limited crowdfunding to only accredited investors. In 2016 the restriction was removed and replaced with investment limits based on income and net worth. The change has made it easier for the average person to invest in private companies.
Non-accredited investors can now back private companies and purchase investment properties with other investors. There are a lot of new opportunities for individuals to participate in the private investments market.
How To Invest In Real Estate Crowdfunding
Real estate investing can be done with the help of crowd funding.
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You and other investors can come together to purchase expensive properties if you pool yourmoney. It can be a great way to increase your returns, and you can also benefit from the expertise of other investors who have more experience in this area.
There are different ways to make money from real estate.
Some deals involve receiving dividends from rental income, for example, by investing in apartment buildings that are already generating revenue, while others involve “flipping” the property, adding value by fixing or renovating it and then reselling the building for a profit. Real estate investing can provide investors with a steady stream of income while also offering the potential to earn large profits in a relatively short amount of time.
Investment Limits for Crowdfunding
As I mentioned earlier, while the SEC opened real estate crowdfunding to non-accredited investors in 2016, they did still impose investment limits. These limits are based on your annual income and net worth:
Less than $107,000
If your annual income is less than $107,000, you can invest the greater of $2,200 or 5%, whichever is less. If you make less than $107,000 per year or have a net worth of less than $107,000, your annual contribution limit will be determined by that.
For example:
| Income | Net Worth | Calculation | 12-month Limit |
|---|---|---|---|
| $35,000 | $100,000 | Whichever is greater: (a) $2,200 or (b) 5% of $35,000 ($1,750) | $2,200 |
| $140,000 | $70,000 | Whichever is greater: (a) $2,200 or (b) 5% of $70,000 ($3,500) | $3,500 |
More than $107,000
You can invest up to 10% of your net worth if your annual income is more than $107,000. Your investment cannot be more than $107,000.
For example:
| Income | Net Worth | Calculation | 12-month Limit |
|---|---|---|---|
| $155,000 | $110,000 | 10% of $110,000 ($11,000) | $11,000 |
| $220,000 | $800,000 | 10% of $220,000 ($22,000) | $22,000 |
| $1.3 million | $2.5 million | 10% of $1.3 million ($130,000), subject to cap | $107,000 |
Note on Crowdsourcing Limits for Married Couples
If you are married, the SEC will allow you to make the calculations based on your combined annual income and net worth. Both spouses can still benefit from the SEC’s investment rules even if the assets are not held together. It is still restricted to the above limits, as though it was a single investor at that annual income or net worth.
Can You Make Money in Real Estate Crowdfunding?
The short answer to this question is “yes.” Researchers analyzed the returns of the major investment types and found that real estate outperformed the stock market. Real estate investments have provided steady returns over the long-term, making them a reliable and profitable option for investors.
In recent years, according to Fundrise, the average annualized return for their crowdfunded investments was:
- 2021: 22.99%
- 2020: 7.31%
- 2019: 9.47%
- 2018: 9.11%
- 2017: 11.44%
- 2016: 8.76%
- 2015: 12.24%
- 2014: 12.25%
How Much Money Can You Make Crowdfunding Real Estate?
How much you can make is dependent on a number of factors. Before investing in real estate, it is important to research the market and understand the risks. The amount of money you invest is obvious. The amount of money you invest can affect the success of your business venture. The bigger the investment, the bigger the potential return.
Crowdfunded real estate on average has performed well over the past few years. Depending on the amount of money you are able to initially or continually invest, the compounding interest and dividends you can make are unlimited. You can accumulate wealth if you take advantage of the power of compounding interest and dividends.
With platforms that connect you and other investors with revenue-generating properties and projects, it’s easier than ever to create a starter portfolio of real estate. You can get started with your real estate portfolio on many of these platforms.
Is Real Estate Crowdfunding a Good Investment?
Real estate is not new. Real estate is one of the most popular investments today. Real estate has a long history of profitability that has helped in part to build the wealth of the vast majority of this country’s millionaires. Purchasing real estate as a means of building wealth is a sound investment decision.
If nothing else, investing in real estate adds an extra layer of protection to your portfolio against stock market declines. Diversification is a smart move if you are primarily invested in stocks and bonds. One of the best ways to protect your portfolio is to Diversify your investments.
And now, in addition to REITs (real estate investment trusts), crowdfunding allows everyday people to invest in real estate, where it used to only be available to the 1%.
That said, you should treat real estate crowdfunding the same way you treat other investments: do due diligence on the properties and funds you choose, in sectors you know about, and on platforms that are legit.
Which Real Estate Crowdfunding Site Allows Non-Accredited Investors?
Some real estate crowdfunding sites require that you be an accredited investor. This means you must either:
- Have earned $200,000 in annual income ($300,000 for joint investors) for the last two years with the expectation that you’ll earn the same or more this year, OR
- Including your primary residence, have a net worth over $1,000,000.
The requirement exists because the SEC wants to ensure people investing in unregistered securities can afford to lose it. The accredited investor requirement assumes that the person can do their own due diligence. The risk of investing in a given venture must be evaluated by the accredited investor.
The bar may be too high for many investors. It is not suitable for everyone to invest in the stock market. You can still invest in real estate through a crowdfunded platform if you are not an accredited investor.
Our list of top platforms gave priority to the sites that welcome all investors, but to recap:
