7 Real Estate Investing Platforms to Grow Your Wealth
Real estate investing platforms provide a means for investors to grow their wealth with real estate without shelling out cash for a physical property they’ll have to maintain. These platforms enable investors to buy shares in real estate projects, commercial buildings, and REITs (real estate investment trusts).
When most people think of real estate investing, they’re thinking of buying a place to rent out, or buying a fixer to rehab and sell. But the world of growing cash with smart real estate investments has definitely expanded.
You no longer have to stress about qualifying for another mortgage so you can make money on a rental. Investment platforms make it really easy to be an armchair real estate investor and enjoy those profits as well.
Online Real Estate Investment Platforms
Fundrise is the first investment platform to create a simple, low-cost way for anyone to access real estate’s historically consistent, exceptional returns.
With a track record of purchasing over 200 assets worth over $5.1 billion, Fundrise offers an element of trustworthiness others may not be able to offer.
The sheer diversity of the types of properties and their expanse of geographic locations bodes well for investors who like to maximize diversification.
- Current investment minimum is only $10.
- Good for beginners and doesn’t require being accredited.
- By managing all of their purchases and finances in-house, Fundrise is able to keep fees low for investors.
- Their app makes it easy to stay informed about property completion, progress, and occupancy reports for the real estate you invested in. Nice!
- With a focus on lower-risk investments like multifamily properties, the potential for earnings isn’t as maximized as it could be.
- Fundrise isn’t for investors with large amounts of cash they’d like to sink into individual property offers.
- Crowdfund real estate investing isn’t without risks. Though Fundrise has a stringent vetting process, there’s still a risk of default and loss of funds.
DealMachine is a real estate investment app that assists real estate investors as they canvass areas looking for distressed houses to buy.
The most common app perk is access to property owner information (which they term “driving for dollars leads”). You’ll also get info about mortgage balances, vacancy status, etc.
The term “driving for dollars” is used many times in DealMachine’s marketing language. However, you won’t be paid to drive around looking for houses.
It’s a common phrase among real estate investors which means that sometimes all that driving around could result in earning some dollars—if you convince someone to sell.
The app helps you chart the routes you’ve already driven and has a function for keeping a running list of potential properties you spot.
As part of your membership, DealMachine will then send postcard offers to the list of houses you compile.
- Offers a 7-day free trial and then $59/month for the cheapest plan which gives you up to 500 homeowner’s contact information.
- They offer access to data such as county records, mortgage balance, and vacancy status.
- This is a direct mail marketing service as well; you can customize designs and send more than one mail sequence.
- DealMachine is designed as lead-generation software; you do the groundwork, and it fills in the owner/property information and markets via mailings.
- You won’t get paid to drive around and look for houses.
- DealMachine doesn’t show you where houses are or help you pay for them.
- If you find a homeowner willing to sell, you’ll need real estate transaction knowledge or a real estate agent to help with the sale—as well mortgage qualifications or cash for purchase.
CrowdStreet offers a variety of real estate investment projects which you can compare and review easily on their website.
If there’s an opportunity you’d like to invest in, you’ll have access to the financial documents for that project. And you can attend a live Q&A webinar with the sponsor as well. Talk about being well informed!
This platform offers investors a chance for a diverse real estate portfolio with choices in risk level, geographic location, and type of property.
- This isn’t for beginners—accredited investors only.
- This kind of investing is considered real estate crowdfunding, where individual investors pool money to fund projects.
- There’s a minimum investment of $25,000.
- It has a user-friendly platform for both investors and sponsors.
- All real estate investments carry risk, and crowdfunding is no exception. Beware of defaulted loans and canceled projects.
- Investing in any kind of real estate on a platform such as CrowdStreet is a longer term commitment than other types of investments. Your money isn’t liquid.
- There’s a high minimum investment, therefore you have a lot to lose if something goes wrong.
Groundfloor is crowdfunding that offers loans to people who’d like to buy a house to fix it and flip it.
Instead of having to qualify for a traditional mortgage or loan, real estate investors looking to buy a property can turn to Groundfloor crowdfunding to borrow from individual investors like you and me.
The website is very easy to use, set up an account, and view the projects waiting for funding. We also like that there are very specific progress reports on how the work on the house is progressing.
- Current investment minimum is only $10.
- They claim average returns of 10% or more.
- These are short term loans with 6-18 month terms (with a range in between).
- You’re investing in real estate debt rather than equity investments (a bit more risk).
- Serves both investors and borrowers—with emphasis on flipping houses.
- Groundfloor has a comprehensive rating system so investors can assess their risk comfort level.
- Each project lists quite a bit of detail: borrower info, what they’ve put into the project themselves, how much the project will cost, what the projected sale price or return is projected to be, etc.
- If you sign up for their automatic investment feature, make sure you’ve set your preferred parameters carefully to your comfort level.
- It’s a bit limited in that you can only invest in house flippers and property builders.
- There’s a real risk of loan default since it’s heavy on the fixer-upper loans.
Yieldstreet offers a very unique range of options that are well vetted. Their investments include things like art, freight shipping vessels, real estate, commercial real estate, etc.
So far they’re the only platform I’ve seen that offers art and marine types of investment opportunities. This can be really good for diversifying your investment assets.
Yieldstreet’s three investment types:
- Funds such as their Prism fund which is a multi-asset investment that includes over 5 asset classes including art, commercial, legal, real estate, etc.
- Single offering investments: a list of properties you can choose from.
- Structured notes (similar to bonds) which are debt securities and are generally short term (less than 12 months).
- Accredited investors only.
- Many of the investment opportunities Yieldstreet offers pay out quarterly dividends which could end up being a decent way to generate passive income.
- The company is very choosy on which investments to buy into and they’ve been around since 2015, so they have a proven track record.
- The investment ranges vary between $500 (smallest) and $50,000 (largest).
- They have a great mix of assets to choose from (art, legal, commercial, and more).
- Their notes offering provides cash liquidity in case you need the principal amount of your investment in no more than 12 months.
- These investments aren’t for beginners (you must be an accredited investor).
- Most of their offerings require a very high investment commitment.
- As with any investment, there are risks involved.
PeerStreet offers a way for investors to make money off of real estate debt. When someone borrows money for a home, your investment in their loans can earn you money as they pay it back.
Working with private lenders all over the country, PeerStreet evaluates track records and uses their own underwriting team to assess each opportunity. If it passes their stringent testing, the loans are offered as investment opportunities on their platform.
An unique component of investing with PeerStreet is their “Pocket” investment offer. You can put extra cash into “pocket” and earn around 2.5% which is much better than a traditional bank.
This is pretty much just lending them money without committing to other investment types on their platform. You can also put your cash in Pocket while you wait for your next real estate opportunity with them.
This isn’t a bad idea as an extra savings account—but you’ll need to tell them you’d like to withdraw money by the 15th of the month to get it by the 1st of the following month.
- Accredited investors only.
- Can start with as little as $1,000.
- PeerStreet is transparent about their fees (between 0.25% and 1.00%).
- They offer automated investing: fill out your criteria for risk, investment amount, etc. and Peerstreet will place you automatically with investments to match.
- Earnings for the average investor is a little over 6% with a median of 8.2%.
- You’ll need to be accredited to invest with PeerStreet, so it’s not for beginners.
- They have a high minimum investment requirement of $1,000.
- The money you keep in their Pocket offer isn’t FDIC insured and you can’t withdraw money immediately (it’s about a 2-week wait).
- Keep in mind that investment terms range from 1-36 months (not a liquid investment).
RealtyMogul provides commercial real estate investing with a wide variety of offerings on their website. They offer both REITs as well as individual property investments.
RealtyMogul REITs contain both debt and equity, and are spread over a large geographic area to make the most of the diversity in the housing market in various areas of the US. They also have no commission fees (although other fees apply).
RealtyMogul’s three REIT types:
- Income REIT is a diversified mix of multi-family, office, and retail properties and distributes dividends to investors monthly. The minimum investment is $5,000 but it’s open to everyone (non-accredited is OK).
- The Apartment Growth REIT is a range of apartment buildings in a variety of locations with high occupancy levels and potential for profits from rent income. The minimum investment is $5,000 and pays quarterly dividends.
- The MogulREIT I has a much lower buy-in at only $1,000 for unaccredited investors who’d like to diversify their portfolios with commercial properties.
RealtyMogul’s single property investments include office, retail, multifamily, and industrial properties, and require investors to be accredited by the SEC.
The minimum buy-in is between $25,000 and $50,000 with a general timeframe for investment of 3-7 years.
- The range of REITs available have minimum investment requirements of between $1,000 to $5,000 and are fine for unaccredited, beginner investors.
- Their individual property offerings require large amounts of cash and being an accredited investor.
- RealtyMogul has a proven track record of distributing dividends and having no commission fees. (Other fees apply.)
- The properties they invest in are carefully vetted and underwritten by their specialized team.
- Investments with this platform (as with many real estate investments) are relatively long term, with some requiring a 10-year commitment.
- Dividends are never guaranteed, although RealtyMogul has a good standing record of paying out over the last 64 months.
- All real estate investments are risky, so learn all you can and consult a financial advisor if needed.
- Only the REIT offerings can be held by beginners who aren’t accredited.
- Passive Real Estate Investing: A Beginner’s Guide
- The Pros and Cons of Investing in Real Estate
- Fundrise vs. RealtyMogul – How These Crowdfunding Sites Compare
Real Estate Investing Platforms Wrapup
Real estate investing isn’t for everyone, and there can certainly be a good bit of risk depending on who you invest with. But there’s sure to be a quality investment platform for your real estate investment goals.
And the great thing is, you can set your risk and goal preferences on most any of the platforms so you can feel comfortable with the choices you make.