BEST OF
7 Best Real Estate Crowdfunding Investment Platforms of April 2021
Real estate crowdfunding has transformed the real estate investing landscape. Once reserved for only the most affluent investors, many crowdfunding platforms have significantly lowered the barrier to entry for this type of alternative investment.
Low account minimums, simple fee structures and clean user interfaces make it easier than ever to include real estate in a well-diversified portfolio. It’s important to note that some real estate crowdfunding platforms, including three of our picks below, are open only to accredited investors.
What's the difference between these platforms and REITs?
Real estate investments trusts are companies that own real estate, like hotels, malls, shopping centers or rental properties. Publicly traded REITs can be purchased through a brokerage just like individual stocks or mutual funds.
Real estate crowdfunding platforms, on the other hand, pool funds together to let average investors participate in the real estate market through private REITs — which aren’t available through traditional brokerages — as well as private market real estate investments, like individual properties. These could potentially provide higher returns than the REITs available through traditional brokerages, but they may also carry higher risk.
Ready to get started? Below are our top picks for the best real estate crowdfunding platforms based on several factors, including account minimums, customer support, redemption options, fees and more.
Real estate crowdfunding has transformed the real estate investing landscape. Once reserved for only the most affluent investors, many crowdfunding platforms have significantly lowered the barrier to entry for this type of alternative investment.
Low account minimums, simple fee structures and clean user interfaces make it easier than ever to include real estate in a well-diversified portfolio. It’s important to note that some real estate crowdfunding platforms, including three of our picks below, are open only to accredited investors.
What's the difference between these platforms and REITs?
Real estate investments trusts are companies that own real estate, like hotels, malls, shopping centers or rental properties. Publicly traded REITs can be purchased through a brokerage just like individual stocks or mutual funds.
Real estate crowdfunding platforms, on the other hand, pool funds together to let average investors participate in the real estate market through private REITs — which aren’t available through traditional brokerages — as well as private market real estate investments, like individual properties. These could potentially provide higher returns than the REITs available through traditional brokerages, but they may also carry higher risk.
Ready to get started? Below are our top picks for the best real estate crowdfunding platforms based on several factors, including account minimums, customer support, redemption options, fees and more.
Summary of Best Real Estate Crowdfunding Investment Platforms of April 2021
| Broker | NerdWallet Rating | Commissions | Promotion | Account Minimum | Learn More |
|---|---|---|---|---|---|
Best for Nonaccredited investors | 1% other fees may apply | Advisory fee waiver for 12 months | $500 | on Fundrise's website | |
Best for Accredited investors | 0.50% to 2.5% for funds; project fees vary | None no promotion available at this time | $25,000 | on CrowdStreet's website | |
Best for Nonaccredited investors | $0 management fee | None no promotion available at this time | $500 | on DiversyFund's website | |
Best for Accredited investors | 0.5% - 1.5% other fees apply | None no promotion available at this time | $5,000 | on EquityMultiple's website | |
Best for Accredited investors | 1% - 2.5% management fees; other fees apply. | None no promotion available at this time | $5,000 | on Yieldstreet's website | |
Best for Nonaccredited investors | 3% upfront fee; other fees may apply | None no promotion available at this time | $500 | Read review | |
Best for Nonaccredited investors | 1% to 1.25% management fees; other fees may apply | None no promotion available at this time | $5,000 | Read review |
Our pick for
Nonaccredited investors
on Fundrise's website
Fundrise
Fees
other fees may apply
Account Minimum
Promotion
for 12 months
on Fundrise's website
Our pick for
Accredited investors
on CrowdStreet's website
CrowdStreet
Fees
for funds; project fees vary
Account Minimum
Promotion
no promotion available at this time
on CrowdStreet's website
Our pick for
Nonaccredited investors
on DiversyFund's website
DiversyFund
Fees
management fee
Account Minimum
Promotion
no promotion available at this time
on DiversyFund's website
Our picks for
Accredited investors
on EquityMultiple's website
EquityMultiple
Fees
other fees apply
Account Minimum
Promotion
no promotion available at this time
on EquityMultiple's website
on Yieldstreet's website
Yieldstreet
Fees
management fees; other fees apply.
Account Minimum
Promotion
no promotion available at this time
on Yieldstreet's website
Want to compare more options? Here are our other top picks:
Last updated on February 22, 2021
Methodology
NerdWallet’s comprehensive review process evaluates and ranks established and emerging real estate crowdfunding platforms, using a multifaceted and iterative approach. Our aim is to provide an independent assessment of providers to help arm you with information to make sound, informed judgements on which ones will best meet your needs.
DATA COLLECTION AND REVIEW PROCESS
We collect data directly from providers, and conduct first-hand testing and observation through provider demonstrations. Our process starts by sending detailed questionnaires to providers to complete. The questionnaires are structured to equally elicit both favorable and unfavorable responses from providers. They are not designed or prepared to produce any predetermined results. The questionnaire answers, combined with product demonstrations, interviews of personnel at the providers and our specialists’ hands-on research, fuel our proprietary assessment process that scores each provider’s performance across seven core areas. The final output produces star ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.
RATING FACTORS
Evaluations are based upon the weighted averages of factors that include but are not limited to: investment selection, management fees, account minimums, redemption options, transparency when it comes to investment options and information available on provider websites, and customer support.
FACTOR WEIGHTING
The weighting of each factor is based on our team’s assessment of which features are the most important to consumers and which ones impact the consumer experience in the most meaningful way.
INFORMATION UPDATES
Writers and editors conduct our real estate crowdfunding platform reviews on an annual basis but continually make updates throughout the year. We maintain frequent contact with providers and highlight any changes in offerings.
THE REVIEW TEAM
The review team comprises seasoned writers, researchers and editors who cover real estate investments as well as other alternative investments and broader investing topics and strategies on a daily basis. In addition to NerdWallet, the work of our team members has been published in The New York Times, The Washington Post, Forbes, USA Today, Bloomberg News, Nasdaq, MSN, MarketWatch, Yahoo! Finance and other national and regional media outlets.
The combined expertise of our Investing team is infused into our review process to ensure thoughtful evaluations of provider products and services from the customer perspective. Our writers and editors combine to have more than 70 years of deep experience in finance, ranging from a former Wall Street Journal reporter to a former senior financial advisor at Merrill Lynch.
CONFLICTS OF INTEREST
While NerdWallet does have partnerships with many of the reviewed providers, we manage potential conflicts of interest by maintaining a wall between our content and business operations. This wall is designed to prevent our writers and the review process from being influenced or impacted by our business partnerships. This way, all reviews can provide an unbiased review that serves the interests of our users. For more information, see NerdWallet’s editorial guidelines.
To recap our selections...
NerdWallet's Best Real Estate Crowdfunding Investment Platforms of April 2021
- Fundrise: Best for Nonaccredited investors
- CrowdStreet: Best for Accredited investors
- DiversyFund: Best for Nonaccredited investors
- EquityMultiple: Best for Accredited investors
- Yieldstreet: Best for Accredited investors
- Rich Uncles: Best for Nonaccredited investors
- RealtyMogul: Best for Nonaccredited investors
Frequently asked questions
Real estate crowdfunding involves pooling investors' money to fund a real estate project or investment. Often this is done by investing in a private REIT, but some of these platforms also give investors access to private real estate development projects. Some crowdfunding platforms let investors gain exposure to real estate for as little as $500.
While buy-in can be relatively low and the risks are in some cases similar to investing in individual stocks, it's important to note that real estate crowdfunding platforms are new to the investment sphere. How these nascent companies hold up during and after severe market downturns is yet to be seen. Keep in mind that no investment is without risk, and investments that aim for higher returns often carry more risk.
Many of the real estate investments offered in these crowdfunding platforms can be illiquid, or take longer to convert into cash, and are likely better suited to investors who can afford to be patient. If you're looking for an investment that you can sell out of in a pinch to generate cash, traditional investment accounts invested in mutual funds, ETFs, stocks and bonds may be a better fit for you.
Through some online real estate investment platforms, investors can start for as little as $500. However, some of these platforms require higher minimums or that investors be accredited.
Accredited investors are allowed to participate in investments not registered with the U.S. Securities and Exchange Commission. The designation is meant to ensure only those investors with the appropriate experience, funds and understanding of risk can take part in certain investments. Accredited investors must have income of more than $200,000 in each of the last two years (or $300,000 together with a spouse), or have a net worth of more than $1 million, excluding a primary residence.
Some of the biggest advantages of REITs include consistently high dividends (making them a popular choice among investors looking for fixed income), historically high returns and often less volatility than other asset classes. However, publicly traded REITs that can be purchased through a traditional brokerage account are generally considered safer than private REITs offered by real estate crowdfunding platforms.
Public REITs are traded on an exchange just like stocks and exchange-traded funds, and are available through most brokerage accounts. Private REITs aren’t listed on public exchanges, nor are they typically registered with the SEC.
With fewer disclosure requirements, it can be very difficult to evaluate the performance of private REITs. Public non-traded REITs — a third category — are registered with the SEC, but aren’t available on an exchange. Learn more about the risks associated with private and public non-traded REITs.
