If you’re looking to venture into real estate but are deterred by the hefty initial investment, real estate crowdfunding platforms might be your solution. These platforms, including CrowdStreet, allow you to start investing with just a small sum, eliminating the challenges of sourcing and managing properties.
CrowdStreet, in particular, stands out by conducting rigorous background and reference checks on developers, ensuring you’re investing in quality projects without the legwork. This comprehensive vetting process not only offers peace of mind but also positions the platform as a time-saving solution for investors.
Dive deeper into our CrowdStreet review to determine if it aligns with your investment goals and answer the question, “is CrowdStreet the best Real Estate Crowdfunding platform?” Before you read much further, it must be noted that CrowdStreet is only available to accredited investors.
Learn More About CrowdStreet
What Is An Accredited Investor?
An accredited investor is basically someone given the green light to dive into investment opportunities that aren’t listed with the SEC. Why? Because they’ve got the financial muscle and know-how to handle potentially riskier bets.
The Securities and Exchange Commission has a checklist to determine who fits the bill. If you’ve been making over $200,000 annually (or $300,000 when combined with your partner) for the past two years and expect the trend to continue, you’re in.
Also, if you have a net worth of over a million dollars, not counting your primary home, that works too. Professionals who hold Series 7, Series 65, or Series 82 licenses or are considered “in-the-know” employees of a private fund also make the cut.
The idea behind these rules? Ensure that investors have the smarts and financial cushion to handle these investments and any bumps they might encounter along the way.
What Is CrowdStreet?
CrowdStreet, launched in 2014 in Portland, has quickly risen as a significant player in the online commercial real estate investment arena. With an impressive portfolio overseeing over $3.9 billion in investments, it offers investors unique opportunities to pour money into specific properties or dive into funds that cover multiple projects.
The essence of CrowdStreet lies in bridging the gap between sponsors – those who are at the heart of real estate operations and development – and investors eager to tap into the lucrative world of commercial real estate.
While anyone can browse the platform, the primary audience is accredited investors who are looking for institutional-grade investments. The range is quite broad, covering individual deals, diverse funds, and even personalized portfolios. Some investment avenues even align with a self-directed IRA.
So, in essence, CrowdStreet is a dynamic platform connecting the real estate world with those looking to get a piece of it.
What is CrowdFunding Real Estate?
Crowdfunding provides a platform for individuals to collectively combine their resources online with fellow investors to acquire property or a portion of it. Venturing into real estate through crowdfunding presents a strategic avenue to expand one’s investment horizons.
Despite being a relatively new approach, crowdfunding shows potential for yielding attractive returns, often aligning with or even surpassing market averages.
Here’s a quick rundown of what you need to know to determine if CrowdStreet is the best crowdfunding real estate investing platform for you:
- Diverse Real Estate Ventures: The platform showcases a range of property types, from commercial to residential and mixed-use. This diversity allows investors to strategize based on their comfort and risk appetite. Whether it’s equity investments, debt, or preferred equity options, CrowdStreet presents a spectrum of risk and return profiles to cater to various investor predilections.
- Platform Usability: Designed for desktop use, CrowdStreet offers an easy-to-navigate interface, making the investment process smooth for users.
- Projected Returns: Historically, while the S&P 500 has garnered returns of around 9.5%, CrowdStreet’s offerings have shown potential returns reaching up to 19.7%.
- Fee Structure: Notably, CrowdStreet doesn’t slap investors with direct fees, a refreshing deviation from many platforms that can charge over 2%.
- Diverse Investment Choices: While CrowdStreet presents a variety of investment options, be prepared to act swiftly. Some opportunities are in limited supply or get snapped up quickly.
- Customer Service: The support team at CrowdStreet is not just responsive but also genuinely helpful. They emphasize the importance of understanding the platform and researching thoroughly before making any investment decisions.
- Educational Content: For those seeking guidance or insights, CrowdStreet’s reservoir of articles and instructional videos can be invaluable. They cover everything from project evaluations to decoding returns.
Is CrowdStreet The Best Real Estate Crowdfunding Platform?
Deciding whether CrowdStreet stands out as the premier crowdfunding platform hinges on individual priorities and investment goals. CrowdStreet boasts a broad selection of rigorously vetted commercial real estate opportunities, encompassing both equity and debt, all without imposing direct fees on investors.
It’s essential to note that CrowdStreet caters mainly to accredited investors. If you are an accredited investor that is willing to have their investment tied up for 2-10 years, CrowdStreet is an option worth seriously considering.