Real estate crowdfunding is my favorite way to invest in real estate, as it allows me to quickly diversify over several deals, and to build a completely passive real estate portfolio. I am often asked what are my favorite platforms to invest in, which is why I decided to write this article in which I'll tell you what are my four favorite real estate crowdfunding platforms.
Real estate crowdfunding is the fact to invest in real estate along with other investors, usually through a platform that will propose real estate deals and take care of all the work, like listing deals, doing all the legal work, and then managing the property. This allows you to invest in real estate with a very low amount of money (sometimes from 50 Euros or Dollars), diversify quickly into many properties, and also have a completely passive real estate portfolio.
Before moving on to the list of platforms, I wanted to tell you about how I choose the platforms that I put in my portfolio and of course in this article. I use two sets of criteria: objective, and subjective.
To choose a platform, I first look at objective criteria, such as the advertised yield of the platform, the track record of projects on the platform (if they had problems with some projects for example), and if there is an automatic investment function. I also check if the platform has an investment license or has applied for a license, which is a very important criterion.
After making a first selection with these objective criteria, I also use more subjective criteria to select my platforms, such as my experience with the platform. I take this opportunity to state that I invest personally on each of the platforms present in this article. The first subjective criterion on which I base myself for the selection is the effective yield of the platforms, which is sometimes different from the advertised yield. For that, I use TrackInvest, a software that I developed and which allows to import the transactions from the platforms before obtaining the real return. I then compare it to the performance announced by the platform to see if they match.
The first platform I wanted to mention here is EstateGuru, which is a platform based in Estonia. It also mainly proposes to invest in real estate development loans, meaning you get a fixed-rate at the start (usually around 10 - 12%).
What I really like about this platform is that they usually offer monthly repayments on the loans they offer, meaning that you will actually get passive income coming in every month when you invest in those development loans. On EstateGuru, the minimum investment in each real estate project is also lower than other similar platforms, at 50 Euros per project. This means that you can actually easily diversify your investments on the platform.
The interface of EstateGuru is also very nice and easy to use, and each project is very well detailed & documented. They also offer an auto-invest function which is quite nice if you want to completely automate your investments on the platform.
As for all platform I mention in this article, I am myself an investor on the platform, and so far I got an average yield of 11.10% on my investments, which is really close to what is announced by the platform.
For all of those reasons, I really recommend having EstateGuru in your investment portfolio.
The second platform that I wanted to mention in this article is Reinvest24. Based in Estonia, this platform allows investors to invest in equity real estate crowdfunding. This means that you will actually become the owner of a share of the properties you invest in and receive a monthly rent just like you would if you invested in 'classical' real estate. Plus a possible capital growth gain once the property is sold. This is really a form of real estate crowdfunding that I really like, as you get passive income coming in every month.
Reinvest24 offers high-quality investments, usually around Tallinn. They usually select properties with a high rental yield, so the returns on the platform are quite attractive at around 7%. Combined with the potential capital growth after the end of a project, you get a total potential return of nearly 14%. They also propose many different types of investments, for example, commercial real estate like small shops & even restaurants, which makes it a great platform to quickly diversify your portfolio.
I've been investing on this platform myself for several years now, and got returns that are around 6.5% on the monthly rents, and I got one project that exited with an annual yield around 7%. They also always paid the rental returns on time.
For all those reasons, Reinvest24 is really a real estate crowdfunding platform I would recommend.
Another platform I wanted to mention here is Bulkestate. It proposes to invest in high-quality property development loans, usually in Latvia. Compared to other platforms, the returns are really strong at around 14%. You can also invest from just 50 Euros, which is one of the lowest minimum amounts of similar platforms.
Bulkestate also has a unique feature compared to other platforms, which is the possibility of group-buying apartments. As they propose apartments in bulk, the prices are lower than if you went yourself to buy a similar apartment. This is an interesting opportunity if you have a larger capital to invest, as you can easily diversify in several apartments that you are buying with a nice discount.
On my own portfolio on the platform, I got returns around 13% so far - which is really close to what is advertised by the platform.
They also have a very strict due diligence process to select which deals end up on the platform and have the possibility to step in on some projects if something doesn't go as planned, meaning more safety for the investors. Overall, Bulkestate is really a platform I recommend having in any real estate crowdfunding portfolio.
These platforms are really my favorites, and I currently have investments in each of them.
I am often asked which is the number one platform they should invest in. It's hard to give an answer as I recommend diversification across multiple platforms, but I consistently answer EstateGuru (for development projects) and Reinvest24 (for projects with rental yields) to start with.
Otherwise, you can also start with EvoEstate to immediately have a more diversified portfolio because this will allow you to invest on several platforms via the same site.