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Real Estate Crowdfunding Reviews

Posted by Julaz Properties on January 7, 2021
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We have put together one of the most comprehensive lists of real estate crowdfunding reviews for the top platforms (and we’re building this page up as quickly as possible to include them all).

Currently, we have about 80 crowdfunding platforms to update, so it may take some time to get them all on here.

Table Of Contents

The Criteria We Used to Compare the Different Real Estate Crowdfunding Platforms

All ‘approved’ crowdfunding sites reach a basic level of functionality. This includes having a functional site with no noticeably fake investments. Also, it should have at least one open investment and be focused exclusively on real estate. Finally, all the information we are looking for should be readily available on the website or be given to us relatively quickly upon request.

Sites that meet this basic level are then graded on 11 different criteria. Each site is graded on each of the criteria, then it’s added up and sorted in order. The best sites get 5-star reviews, the next ones are 4.5 stars, and so on.

Note: We’ve done our best to verify the accuracy of all information but we don’t guarantee everything is 100% accurate at all times. Sometimes information isn’t public, isn’t readily available, or changes. Also, we grade each company on an objective scale of criteria. We have affiliated with some of the top companies and may receive compensation (at no cost to you) if you sign up for their service. This compensates us for the extensive amount of time it takes to rank and review nearly 100 sites.

Here at RealEstateInvesting.org, we have taken a different approach to rankings. We do not assign an arbitrary ranking based on how much we “like” it, or based upon how much the site/service is willing to pay us to review it.

Instead, we have established a set of criteria that is mandatory in order to receive a rating. Once the basics are met, we use a second set of criteria to evaluate them.

We then search their websites for the answers to our list of criteria. If their website lacks the information, we will search the internet, news, or press releases, as well as contact the company directly if all else fails.

Determining the Number of Stars

We currently have over 80 crowdfunding platforms on our tracking list. Because of the large number, we have decided to use the company’s position on our list to determine the number of stars it will receive.

Here is the breakdown:

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*Introducing*

5-Step Investing System

We have spent years developing this process that has literally generated millions of dollars in value and a stable yearly revenue for investors.

Stars Percentage of Companies Allowed
5 Stars 5%
4.5 Stars 5%
4 Stars 5%
3.5 Stars 10%
3 Stars 10%
2.5 Stars 15%
2 Stars 15%
1.5 Stars 15%
1 Star 20%

Another way to look at it – only the top 5% receive a 5-star rating and only the top 15% receive 4-stars or better (4, 4.5, or 5).

Also, since we are ranking companies based on their overall position, we can objectively change the rankings and ratings any time the information changes. Should a smaller company change the way they operate, we can quickly adjust their score and move their position on the list.

Since there are roughly 80 crowdfunding sites that we know about, you can expect to see the following amount in each category

  • 5-stars – 4 sites
  • 4.5-stars – 4 sites
  • 4-stars – 4 sites
  • 3.5 stars – 8 sites
  • 3-stars – 8 sites
  • under 3 stars – roughly 52

Though we will track the position of every site that we can find, we prioritize our full review for the top companies and we probably won’t ever write full reviews for anything under 3 stars.

More about our criteria

All ‘approved’ crowdfunding sites reach a basic level of functionality. This includes having a functional site with no noticeably fake investments. Also, it should have at least one open investment and be focused exclusively on real estate. Finally, all the information we are looking for should be readily available on the website or be given to us relatively quickly upon request.

Sites that meet this basic level are then graded on 11 different criteria.

  1. Availability – It’s expected that people in all states can invest. We are in the process of phasing this category out because we simply aren’t going to consider websites that are available to a small number of states.
  2. Prefunding – If deals are prefunded by the platform then they are accepting risk. If investors don’t like the deal then the platform is stuck with it, which likely increases the level of scrutiny they put on each deal.
  3. Fees – This is on a sliding scale, lower is better.
  4. Minimum investment – The lower the investment minimums the more points the platform receives.
  5. Co-investing – It is beneficial when the crowdfunding site invests in the deals alongside the investors. Just like prefunding the deal, when the platform has to risk its own money, then its interests align more closely with the investors and they will provide more scrutiny and a higher level of due diligence.
  6. Bankruptcy protection – Does the platform have a plan in place should they go bankrupt? This is being removed because we won’t be considering platforms that don’t have this.
  7. VC funding – Has the crowdfunding company received venture capital funding? If VCs are willing to bet their money then it is more likely to survive than a company they shun. Also, VCs usually provide some expertise and advice to help the companies grow and thrive.
  8. Non-accredit investors – The spirit of crowdfunding is to make it available to all. We understand the regulatory environment is very restrictive toward this, but sites that have some investment options for non-accredited investors are given some bonus points.
  9. Diverse property types – Does the platform have investments in multiple types of property such as commercial, residential, retail, hotels etc. Not only is it important for an individual to diversify across property types, but a platform that also has diverse offerings is more likely to survive the next economic downturn.
  10. Equity – Does the crowdfund site offer equity investments? This is being merged with #9.
  11. Debt – Does the site offer crowdfunded debt investments? This is being merged with #9.

The Best Real Estate Crowdfunding Platforms (5-Stars)

Equity Multiple

Minimum Investment

  • Accredited Only.
  • Focus: Equity/Debt
  • Fees: Approx 1.5%
  • Prefund Deals: No
  • Bankruptcy Protection: Yes
  • VC Funding: Yes
  • Debt Investments: Yes
  • Equity Investments: Yes
  • Co-Invest: Yes

Realty Mogul

Minimum Investment

  •  Accredited & Non-Accredited
  • Focus: Equity/Debt * REIT
  • Fees: 4%+
  • Prefund Deals: Often
  • Bankruptcy Protection: Yes
  • VC Funding: Yes
  • Debt Investments: Yes
  • Equity Investments: Yes
  • Co-Invest: No

Fundrise

Minimum Investment

  •  Accredited & Non-Accredited
  • Focus: Equity/Debt
  • Fees: Approx 1.5%
  • Prefund Deals: No
  • Bankruptcy Protection: Yes
  • VC Funding: Yes
  • Debt Investments: Yes
  • Equity Investments: Yes
  • Co-Invest: Yes

Fundrise – 5/5

Our criteria are that the top 4 sites will receive 5-star reviews, but Fundrise has the highest score overall and is the #1 site we review.

Fundrise created a marketplace that is fairly transparent and their goal is to “make the process of investing in the highest quality commercial real estate from around the country simple, efficient, and transparent.” Essentially, they bridge the gap between the investor and the developer.

Fundrise currently has roughly 93,000 members and they have invested in nearly $3 billion worth of real estate. They let you invest as little as $500 at a time and you get to pick the projects or funds you want to invest in.

Fundrise pioneered the eREIT offering, which is similar to a REIT but offered under the new Regulation A+. They currently have 5 eREITs to choose from and are expanding. They are a bit different than other platforms because it currently only offers its eREIT which is available to both accredited and non-accredited investors.

Fundrise does have higher fees than many other platforms, but it needs to be put into perspective. Fundrise is focused on its eREIT offerings, which are not typical crowdfunding deals. REITs typically have fees of 5-10% while a typical crowdfunding deal has fairly low fees of around 1-2%.

So, Fundrise’s fees are actually quite low when compared to the REIT industry average fees.

Read The Review of Fundrise.

Sign Up Now.

EquityMultiple – 5/5

EquityMultiple is a bit younger and smaller than some of the other top-tier platforms, but they have several features that outshine some of the competition.

What stands out most compared to their competition is how they are compensated. They receive a flat .5% asset management fee (pretty standard) and they only receive 10% of profits. If there are no profits, then they don’t get compensated. So, if you receive all your capital back plus 10% profits, EquityMultiple receives 1%, if you get 20% they get 2% and so on.

Also, the principals of EquityMultiple have participated in each deal on the platform which is a form of co-investing.

The biggest drawback with EquityMultiple is their high minimum investment amounts. The minimums vary by project and can be as low as $5,000, but, when EquityMultiple was contacted they said the average minimum investment is around $25,000. We believe the alignment of profit incentives and the co-investing of the principals more than offset the high minimum investment.

Read The Review of EquityMultiple.

Sign Up now.

RealtyMogul – 5/5

RealtyMogul is an amazing crowdfunding platform to choose because it has such a wide variety of investment options for both accredited and non-accredited investors.

Its strengths include an extremely low investment minimum of $1,000, a variety of equity and debt investments in a wide array of property types, and low fees.

There are a few negatives that are holding it back from being the best. First, it does not prefund its deals which means that the platform isn’t accepting much risk (and aligning its interests with ours).

Also, it doesn’t have specified bankruptcy protections for the investors, which puts the investors at the mercy of whatever the courts may decide to do.

Great Real Estate Crowdfunding Sites (4.5-stars)

Peer Realty

Minimum Investment

  • Accredited Only
  • Focus: Equity
  • Fees: 1%
  • Prefund Deals: No
  • Bankruptcy Protection: Yes
  • VC Funding: No
  • Debt Investments: No
  • Equity Investments: Yes
  • Co-Invest: No

Patch of Land

Minimum Investment

  • Accredited & Non-Accredited
  • Focus: Mortgages
  • Fees: 0-3%
  • Prefund Deals: Yes
  • Bankruptcy Protection: Yes
  • VC Funding: Yes
  • Debt Investments: Yes
  • Equity Investments: Yes
  • Co-Invest: No

Acquire RealEstate

Minimum Investment

  • Accredited Only
  • Focus: Equity & Debt
  • Fees: 5%+
  • Prefund Deals: Yes
  • Bankruptcy Protection: Yes
  • VC Funding: No
  • Debt Investments: Yes
  • Equity Investments: Yes
  • Co-Invest: Yes

Fund That Flip

Minimum Investment

  • Accredited Only
  • Focus: Mortgages
  • Fees: 1%-3%
  • Prefund Deals: Yes
  • Bankruptcy Protection: Yes
  • VC Funding: No
  • Debt Investments: Yes
  • Equity Investments: No
  • Co-Invest: No

Acquire Real Estate – 4.5/5

Although AcquireRealEstate checks the blocks that give it a good score, they probably should be ranked much lower due to their fees. Unfortunately, the reality of having standardized scoring criteria is sometimes the ranks don’t line up 100%. That’s why we’ve added this note.

The heart of crowdfunding is transparency and low fees. The fee structure is nowhere to be found on their site or in the individual investments, except in the PPMs (which are private and past PPMs cannot be access on their site).

AcquireRealEstate has some of the highest fees of all the sites we review. They will take anywhere from 5-7% of the total capital in fees.

Make sure you fully read the PPM and understand the fees before investing with AcquireRealEstate.

PeerRealty – 4.5/5

Review coming soon.

Patch of Land – 4.5/5

Patch of Land is a platform for investors to find potential investments in mortgage-backed real estate. The platform receives requests for funding, vets the deal, then puts it on their website if the deal meets their criteria.

The term ranges from 1 to 36-month loans and the investors start earning interest almost immediately. Patch of Land is a little different than most crowdfunding platforms – they prefund each deal. When you put your money into a deal, you start earning interest on that money as soon as it clears escrow and you don’t have to wait for the loan to be fully funded by other investors before you start earning interest.

Patch of Land also has very strong bankruptcy protection for the investors meaning if the platform goes bankrupt, you as the investor are still protected.

Patch of Land has a wide diversity of loans in 36 states – from 12-month fix/flip, rehab, refi, etc. to residential 24-month stabilized rentals, to multifamily (various refi, rehab) and also commercial (various refi/rehab).

The biggest drawbacks are its availability to only accredite investors and that it only allows you to invest in short-term debt.

Read more about Patch of Land.

Fund That Flip – 4.5/5

Review coming soon

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