E. NapoletanoContributor
E. Napoletano is a former registered financial advisor and award-winning author and journalist.
E. Napoletano
E. NapoletanoContributor
E. Napoletano is a former registered financial advisor and award-winning author and journalist.
Contributor
Michael AdamsLead Editor, Investing
Michael Adams is lead editor, investing at Forbes Advisor. He's researched, written about and practiced investing for nearly two decades. As a writer, Michael has covered everything from stocks to cryptocurrency and ETFs for many of the world's major financial publications, including Kiplinger, U.S. News and World Report, The Motley Fool and more. Michael holds a master’s degree in philosophy from The New School for Social Research and an additional master's degree in Asian classics from St. John’s College.
Reviewed
Michael Adams
Michael AdamsLead Editor, Investing
Michael Adams is lead editor, investing at Forbes Advisor. He's researched, written about and practiced investing for nearly two decades. As a writer, Michael has covered everything from stocks to cryptocurrency and ETFs for many of the world's major financial publications, including Kiplinger, U.S. News and World Report, The Motley Fool and more. Michael holds a master’s degree in philosophy from The New School for Social Research and an additional master's degree in Asian classics from St. John’s College.
Lead Editor, Investing
Reviewed
Updated: Nov 20, 2023, 12:49pm
Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations.
If you think it takes a ton of cash to invest in real estate, think again. There’s a new class of real estate crowdfunding platforms that make it easy for regular folks to access property assets that once upon a time were only available to sophisticated investors.
To help with your search for alternative assets, we’ve taken a look at some of the best real estate crowdfunding platforms available on the market today. Our list includes platforms tailored for accredited and non-accredited investors. Just remember, like all alternative investments, real estate carries heightened risks, lower liquidity and volatile prices.
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Show Summary
- Yieldstreet
- Best Real Estate Crowdfunding Platforms for Regular Investors
- Best Real Estate Crowdfunding Platforms for Accredited Investors
- Methodology
- What Is an Accredited Investor?
- What Is Crowdfunding?
- Real Estate Crowdfunding vs. REITs
- Real Estate Crowdfunding vs. Individual Real Estate Investing
- Next Up In Investing
FEATURED PARTNER OFFER
Yieldstreet
What is Yieldstreet?
An online platform that makes it easy to invest in alternative investments.
What investments are offered?
Private Credit, Structured Notes, Real Estate, Art, Legal Finance and other alternatives.
Net annualized return
9.6% net annualized return since 2015.
On Yieldstreet's Website.
An online platform that makes it easy to invest in alternative investments.
Private Credit, Structured Notes, Real Estate, Art, Legal Finance and other alternatives.
9.6% net annualized return since 2015.
Best Real Estate Crowdfunding Platforms for Regular Investors
| Company | Fees | Account Minimum |
|---|---|---|
Fundrise | 1.00% | $10 |
Groundfloor | None | $1,000 |
Realty Mogul | 1.00% to 1.25% for REITs | $5,000 |
Diversyfund | None | $500 |
Fundrise
Fees
Account Minimum
$10
BBB rating & reviews
A+
1% (0.15% advisory; 0.85% asset management)
$10
A+
Editor's Take
Fundrise boasts a real estate portfolio in excess of $7 billion—something emerging real estate investors can access for a nominal $10 investment.
But beyond low account minimums and reasonable fees, Fundrise offers a variety of real estate investment trusts to get your feet wet, plus a streamlined account opening process to help you get started in a flash.
And in exchange for a modest monthly fee, you can access Fundrise Pro to build a custom investment plan and dive deeper into the data behind each of the company’s offerings.
Groundfloor
Fees
None
Account Minimum
$1,000 ($10 increments for further investments)
BBB rating & reviews
B
None
$1,000 ($10 increments for further investments)
B
Editor's Take
With a historical track record of producing 10% returns over the most recent 8-year period, Groundfloor could be an attractive option for those new to real estate investing.
Open to everyday and accredited investors, Groundfloor offers investments in fractionalized offerings—in $10 increments after the $1,000 minimum is reached—in individual real estate loans. Individual investors come together to pool money to fund loans with terms ranging from six to 12 months, while the company’s fee-free platform lowers investor risk.
Loans are risk-rated using grades A through G—with A being the least risky and G the most risky. Most A-rated loans yield roughly 5.5%, and G-rated loans yield 26%. Your returns aren’t credited to your account until the property sells, so it’s best not to invest cash you may need before the loan’s maturity date.
Realty Mogul
Fees
1% to 1.25% for REITs, varying fees for other assets
Account Minimum
$5,000
BBB rating & reviews
A+
1% to 1.25% for REITs, varying fees for other assets
$5,000
A+
Editor's Take
With more than 274,000 investors on the platform, Realty Mogul, a home for flexible investment options, lets non-accredited investors get a taste for real estate through its REIT offerings. While private placements are available, those are reserved for accredited investors.
The initial $5,000 investment isn’t for the faint of heart, but Realty Mogul’s two REIT offerings have posted respectable returns—in the high 7% to 8% range for their Income and Apartment Growth REITs. Of course, if you’re income-minded, each REIT offers a decent track record for distributions: 21 consecutive quarters for the Apartment Growth REIT and 79 consecutive months for the Income REIT.
Diversyfund
Fees
None
Account Minimum
$500
BBB rating & reviews
Not yet rated
None
$500
Not yet rated
Editor's Take
With only 28,000 investors, Diversyfund offers a smaller crowdfunding platform than many of its peers. The company’s $175 million portfolio focuses on multifamily properties across six states. The platform is fee-free, and with modest minimums Diversyfund provides new investors easy access to real estate sector exposure.
The platform’s deals tend to have a 5- to 7-year time horizon, and non-accredited investors have access to Diversyfund’s Growth REIT at a $500 investment minimum. They also offer Premier Opportunities. However, those are reserved for accredited investors and have minimum investments of $25,000 or more.
Best Real Estate Crowdfunding Platforms for Accredited Investors
| Company | Fees | Account Minimum |
|---|---|---|
| First National Realty Partners | Varies | $50,000 |
| AcreTrader | 0.75% annual management fee | $15,000 to $40,000 |
| Crowdstreet | 1.50% of NAV | $25,000 |
| EquityMultiple | Typically a 1% annual management fee | $5,000 |
| PeerStreet | Typically 1% of net proceeds | $1,000 |
First National Realty Partners
Fees
Varies by deal
Account Minimum
$50,000
BBB rating & reviews
A+
Varies by deal
$50,000
A+
Editor's Take
First National Realty Partners’ tech-powered deal selection process gives well-heeled investors access to real estate opportunities where “people live, shop, work and play,” per the firm’s motto. For a minimum investment of $50,000, you’ll gain access to commercial real estate properties like multi-family housing projects, grocery-anchored retail shopping centers and industrial centers.
First National Realty’s investment process is 100% online, which could be a pro or a con depending on whether you prefer in-person consultations before settling on a major investment with minimums at this level. However, you can attend webinars for each deal, giving you the chance to ask questions and get answers from an actual human.
AcreTrader
Fees
0.75% annual management fee
Account Minimum
$15,000 to $40,000
BBB rating & reviews
A+
0.75% annual management fee
$15,000 to $40,000
A+
Editor's Take
For accredited investors who want to add agricultural exposure to their portfolios, AcreTrader has you covered. A fresh take combining the two markets, this platform exclusively offers investing opportunities for farmland, a niche that the site says has historically been able to offer investors attractive returns and low volatility.
Accredited investors can invest as individuals or institutions (providing they meet specific criteria) with a $15,000 minimum. AcreTrader’s investments are also eligible for use in self-directed IRAs.
Crowdstreet
Fees
1.5% of NAV
Account Minimum
$25,000
BBB rating & reviews
A+
1.5% of NAV
$25,000
A+
Editor's Take
If you’re in search of a simplified way to add commercial real estate exposure to your holdings, Crowdstreet is worth a look. This one-and-done private, diversified REIT includes multiple property types. Here, accredited investors won’t find a slew of deals to parse. Instead, Crowdstreet offers a single investment—their C-REIT—which invests in commercial properties across health sciences, multifamily, industrial and beyond.
For a $25,000 minimum investment, you’ll gain access to a private, diversified REIT managed by a professional team. Management fees will run you 1.5% of net asset value (NAV) on the REIT annually, which could be the encouragement you need to price shop compared to other private REIT offerings.
EquityMultiple
Fees
Varies, but typically a 1% annual management fee and no carried interest charges
Account Minimum
$5,000
BBB rating & reviews
C+
Varies, but typically a 1% annual management fee and no carried interest charges
$5,000
C+
Editor's Take
With a 17% total net return since inception, EquityMultiple can turn some heads. While investment minimums run as low as $5,000, this isn’t a platform for the fledgling investor—it’s accredited investors only. With an in-house vetting and underwriting process where only 5% of prospective investments ultimately make the cut, investors have plenty of options for where to put their dollars.
Available investments range from ultra-short-term investments that promise yields above the average CD to separate yield- and growth-focused options with varying holding periods. And compared to other platforms that charge investors carried interest, EquityMultiple says there’s generally no carried interest charge on most investments, making them unique in the space.
PeerStreet
Fees
Typically 1% of net proceeds, but can vary by investment
Account Minimum
$1,000
BBB rating & reviews
Not yet rated
Typically 1% of net proceeds, but can vary by investment
$1,000
Not yet rated
Editor's Take
PeerStreet specializes in real estate debt. Investment durations typically range from one to 36 months, and the company says they make new loan offerings available daily. This provides accessible real estate debt investment assets for accredited investors.
Unlike most other crowdsourcing operations on our list, each PeerStreet security is secured by a single property, which makes sense since you’re investing in debt instruments. The company only takes a first lien position on all investments, keeping its investors at the front of the line for repayment in the event of default.
Methodology
Forbes Advisor’s list of best crowdfunding platforms divides this unique class of investing tools into options that are tailored to accredited investors and non-accredited investors. This is a key distinction, as non-accredited investors may not access the investment assets offered by many of the platforms.
For sophisticated accredited investors, owning real estate via private REITs and other investment funds provides portfolio diversification and a shot at outperformance that beats more conventional asset classes. That said, past performance is never indicative of future returns, and real estate is a notoriously fickle market.
The platforms tailored to regular investors offer access to public REITs, real estate debt and in some cases fractional ownership of individual property development deals.
For both groups, we surveyed the universe of real estate crowdfunding options in an effort to provide our readers with a basic look at some of the best regarded platforms on the market. Our research was based on public information available on each platform’s website, and we encourage readers to undertake in-depth research of platforms they are considering for their own investment goals.
To learn more about our rating and review methodology and editorial process, check out our guide on how Forbes Advisor rates investing products.
What Is an Accredited Investor?
An accredited investor has the wealth and experience required to own advanced investment assets that are off-limits to the general public.
Things like private equity, venture capital, startups and private REITs receive much less regulatory scrutiny from the Securities and Exchange Commission (SEC), which means they are less transparent and much riskier than more common asset classes.
For individuals to be considered an accredited investor, one of the following criteria must be met:
- Sustained annual income of at least $200,000, or $300,000 for married couples.
- A net worth of at least $1 million—individually or with a spouse—excluding a primary residence.
- Be a “knowledgeable employee” of an investment company, or hold a valid Series 7, 65 or 82 license.
The reason accredited investors are afforded the option to invest in more restricted products is that, due to their wealth or experience, they are presumed to have the ability to navigate the elevated risks implicit in owning alternative investment assets.
What Is Crowdfunding?
Crowdfunding harnesses online communities and social networks to raise funds for projects, causes or businesses. The model involves soliciting financial support from a large number of individuals, often through online platforms. Creators or entrepreneurs present initiatives, and backers contribute money to achieving a project’s goals.
In donation-based crowdfunding, contributors provide financial support without expecting any returns, usually for charitable causes or community projects. Reward crowdfunding offers the backers rewards or perks in exchange for their contributions, such as early access to products or exclusive merchandise.
The platforms listed above are considered to be a type of equity crowdfunding, which allows individuals to invest in a company or project in exchange for ownership or equity. In this model, investors expect financial returns based on the success and profitability of the venture.
Crowdfunding has become popular due to its potential to democratize finance and provide opportunities for individuals who may have difficulty accessing traditional funding sources. It allows project creators to reach a wide audience, tap into the collective wisdom of the crowd, and build a community around their initiatives.
Real Estate Crowdfunding vs. REITs
In many ways, real estate crowdfunding platforms and public REITs are very similar models. Whether you’re using a crowdfunding platform or the stock market, non-accredited investors can only get access to public REITs. These are regulated investments that must meet standards established by the SEC.
You don’t have to use a real estate crowdfunding platform to find a public REIT. There are countless examples traded on markets, available via an online broker or via a financial advisor. If you already have an IRA or taxable brokerage account set up, it could pay to do a search for REITs where you currently hold your account.
On the other hand, accredited investors can access both public REITs and private REITs through crowdfunding platforms. Private REITs are a kind of private placement and can include offerings like 1031 exchanges, individual properties and more.
Typically, private placements have much less stringent regulatory hurdles, which increases their risks. Private REITs tend to be more illiquid than public REITs—many of which trade on exchanges just like mutual funds and ETFs.
Real Estate Crowdfunding vs. Individual Real Estate Investing
If you’re trying to decide between investing in real estate through a crowdfunding site or individual properties, there are a few key criteria to consider, chiefly your liquidity needs and your available investment dollars.
Liquidity Needs
If you want easy access to your cash or the flexibility to buy and sell real estate-related investments at your whim, a REIT offered through a crowdfunding site or an exchange-traded REIT from a brokerage will be a better choice.
Exchange-traded REITs offer the highest liquidity as there’s always a market through the stock exchanges, but some proprietary REITs through crowdfunding sites come in a close second. When investing in individual properties, your ability to buy and sell relies heavily on market conditions.
Available Investment Dollars
If you’re new to real estate investing, crowdfunding platforms can be a great way to whet your whistle. For non-accredited investors, it’s possible to find platforms with low minimums that can help you learn the sector without risking too much of your total portfolio.
For example, new investors may find that coming up with the cash to buy an individual property is too big an ask. That’s where investors of all net worths could benefit from real estate crowdfunding platforms. Between access to REITs and private placements where multiple investors come together to fund single-property deals, crowdfunding sites can help find the type of real estate investment that aligns with your available funds.
However, it’s important to keep in mind that when investing in any single asset class, you expose yourself to sector risk. Real estate is no different. Since there’s no investing crystal ball, not even expert analysts can say for sure where real estate is headed next.
If you’re considering investing through a real estate crowdfunding site, the wisest move is to limit your investment to a fraction of your portfolio—especially if you’re investing using retirement funds.
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