Unlocking Property Investment: Crowdfunding for the Everyday Investor in Real Estate

Looking for a new way to build your wealth? Consider real estate crowdfunding; it’s a great alternative investment that can help diversify your portfolio. This opportunity has become easily accessible to the average investor, thanks to real estate crowdfunding platforms designed specifically for non-accredited investors.

In 2012, the JOBS Act allowed companies to pool funds from multiple investors to buy properties. This led to the creation of over 100 real estate crowdfunding sites, allowing many people to invest in real estate without the hassle of managing a property and to start with a small amount of money.

Traditionally, most real estate investment platforms were only available for accredited investors, people with an annual income of $200,000 ($300,000 if married) or a net worth exceeding $1 million, excluding their primary residence. But if you’re not classified as an accredited investor, don’t worry! There are plenty of real estate crowdfunding platforms designed specifically for non-accredited investors.

Let’s explore some of the best options:

1. **Fundrise**: This platform lets you invest as little as $10 in a diversified portfolio of carefully selected properties. They also offer three different core plans focusing on supplemental income, long-term growth, or a balanced approach. The platform has had excellent historical returns ranging between 8-12% annually.

2. **Groundfloor**: They allow you to invest as low as $10 in individual real estate projects, primarily house renovations. It’s a short-term approach with 6-12 month terms and has offered average annual returns of over 10%.

3. **Arrived**: Similar to Groundfloor but for rental properties. You can invest as little as $100 in rental properties that generate passive cash flow.

4. **RealtyMogul**: Offering REITs for non-accredited investors, RealtyMogul’s REITs invest in a variety of commercial properties. They have an income REIT offering monthly income and a growth REIT focusing on capital appreciation.

5. **DiversyFund**: Offers a Growth REIT that lets non-accredited investors invest in multi-family properties with just a minimum of $500.

6. **Streitwise**: You can invest $5,000 in a portfolio of non-gateway market commercial real estate. They’ve shown a 9% dividend since 2017.

7. **Modiv**: This platform lets you invest $1,000 in a share of a portfolio of commercial real estate such as office buildings, shopping centers, and apartments.

8. **HappyNest**: HappyNest is an app-based platform open to both accredited and non-accredited investors. It allows users to invest as little as $10 in commercial properties leased to companies like FedEx and CVS.

9. **Landa**: Similar to Arrived, it allows you to purchase shares of rental properties starting from just $5.

Now that we know the options, which one is the best for you? The choice depends on your goals and financial situation. There are platforms catering to new investors like Fundrise, offering a user-friendly platform, low entry-level investment and solid returns. Or Groundfloor if you’re interested in investing in individual properties.

Real estate crowdfunding does come with risks, it’s still a relatively new industry, and some platforms have failed in the past. You’re also trusting the platform’s selection of properties. However, the benefits of low minimum investments, diversification, passive income generation, and access to vetted investments can outweigh the risks.

Before delving into this kind of investment, perform your own research, understand the risks, and choose the platform that aligns with your investment goals and risk tolerance.

Lastly, remember real estate crowdfunding isn’t the only way to invest in real estate without buying property. Traditional REITs offer similar benefits and can be invested through popular platforms like Public.com or Webull.