There are tons of real estate crowdfunding sites on the Internet for anyone who’d like to invest with the likelihood of profits in return.
Since these platforms are looking to lure prospective investors, they all tout themselves as the best alternatives out there for all investor classes. Consequently, you’re confused as you want to make the most of your real estate investment.
Besides the deals available on each platform, the designs and layout of these sites are distinct. That said, making the wrong choice in the name of “testing the waters” can result in losing a large chunk of money.
With the non accredited real estate crowdfunding market booming, how do you select the right platform? While this is a daunting activity, this article will take you through vital considerations to make before choosing a crowdfunding platform.
That’s not all:
To ensure that your decision pool is limited to alternatives that have received positive reviews in times past amongst many investors, we’ll give you a run through of the best platform and the perks they provide.
Have you just heard of real estate crowdfunding for non-accredited investors, and you’d like to give it a try? Carefully peruse the subsequent lines to kick-start that budding real estate investment.
Real Estate Crowdfunding in the USA: Some Facts You Never Knew
Rather than delving into the factors to consider when choosing the best real estate crowdfunding platforms, let’s take a closer look at some stellar facts attached to the real estate crowdfunding market in the USA.
Some notable mentions include:
Real estate crowdfunding, while being an excellent option for investors, is still in its formative stages. This market started gaining popularity in the real estate world in 2012 when the Jumpstart Our Business Startups (JOBS) acts came into existence.
As a result of the JOBS initiative signed into law by President Barack Obama, investors, more specifically, the non-accredited variation, could now make real estate investment deals for as low as $10 (applicable on specific platforms only).
Although the real estate crowdfunding market is regulated by the US Securities and Exchange Commission (SEC), the JOBS provisions in 2012 loosened some of their restrictions. For example, companies that provided real estate stocks could commence operations without the SEC’s approval.
While the US market is at the forefront of real estate crowdfunding, the worldwide market is set for a $300 billion growth by 2025.
It’ll be interesting to see how this market shapes up in the years to come with all these aforementioned facts. Are market predictions going to come true? Only time can tell.
Choosing a Crowdfunding Platform in the Foreseeable Future? Here Are Some Factors to Consider
When choosing the right platform that can make real estate crowdfunding for non-accredited investors possible, it’s essential to seek out the market experience they wield.
Speaking about experience, anybody can have some knowledge of economics and claim they’ve acquired mastery. Consequently, it’s essential to do research and check their prowess in the real estate industry.
This aspect is vital as most platforms are just offerings from young techies in “Silicon Valley” claiming to be real estate professionals when they aren’t.
To avoid a scenario like what happened to RealtyShares, it’s essential to make the following considerations. They include:
As a non-accredited investor in crowdfunding, it’s essential to put this factor into perspective. Some real estate crowdfunding platforms don’t cater to individuals from certain jurisdictions.
So, to avoid your money being stuck on a platform, look at their provisions to see if investors from your region are allowed.
For the alternatives that offer their services to other countries, prospective investors might have to fulfill some legal requirements to invest in several real estate deals.
The past dictates the present, they say. Before you invest in a platform, it’s important to do extensive research.
During this seemingly daunting process, make queries in the lines of – How long has this platform been operational? Have they been successful in their previous crowdfunding projects? Have they been fined in times past for breaching governmental regulations?
Getting answers to these questions will go a long way in making the appropriate selection. If you find any red flags during your search, you’d be better off steering clear of that particular platform.
The offerings of real estate crowdfunding platforms differ. Since most sites focus on areas they’ve gained mastery on, it’s essential to know what real estate deal you’d like to invest in and what platform seamlessly carries out that endeavor.
Typically, the standard investment forms include debt and equity. Here, it’s crucial to determine the alternative that fits your financial profile.
With real estate crowdfunding platforms, the fees attached to each vary. Consequently, the onus is on you to check out the “fee policy” of your preferred platform before you settle in and make an investment.
Typically, we can liken this aspect to a “three-way” intersection. While some platforms charge you according to your ROIs (Return On Investments), others can collect fees before your dividends reflect.
The last group? Platforms that place charges on the sponsors rather than the investing party.
While this point might seem like a spill-off from the “history” pointer, this consideration is a tad bit different. Here, seek out information concerning the founders of the crowdfunding platform in question. Are these individuals that have an economic background? What noteworthy deal have they pulled off?
Once you’ve got this segment sorted out, take a closer look at deals they’ve been on in times past and analyze them to ensure they weren’t shabbily put together. Now, you can determine if the site is a mere matchmaker (connecting sponsors with investors) or a platform that’s worth their salt.
Real Estate Crowdfunding for Non-accredited Investors: Top Site with the Best Investment Deals
To engage real estate crowdfunding for unaccredited investors, there are so many sites out there to consider. However, if you’re looking to get the best investment deals, Holdfolio can be tagged the perfect fit.
Investments as low as $20,000. Here, there’s no need to worry about accredited investor provisions like having a set amount under your supervision. More so, unlike some other platforms that offer certain property types only, Holdfolio changes the narrative by giving you access to different property structures. Now, it’s up to you to make a pick.
Finally, you can get an ROI up to 19.5 percent. While other crowdfunding sites feature lower values (commonly between 7 to 10 percent), Holdfolio steps up the anté.
If you’re planning on going into real estate crowdfunding for non-accredited investors, investing with the right platform is everything. Consequently, it’s up to you to engage the above factors to get a site with deals that have huge profit margins.
That said, any real estate crowdfunding platform you decide to go with must feature an intuitive website, an extensive FAQ section to address your concerns, sport decent investment minimums, and most importantly, fitting ROIs.
With limitless potential in the crowdfunding market, now might be the time to take that bold step!