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Crowdestate Review (November 2019 Update)

Crowdestate Review (November 2019 Update)

Last Update: / by Marco Schwartz

In order to diversify my investments, I regularly invest on new platforms that I then review so you too can invest on them & feel confident in doing so. 

In this article, I will review the real estate crowdfunding investment platform Crowdestate, that came to my attention after hearing about from several of my friends that are also investing in real estate crowdfunding. Therefore, I really wanted to try it out and to add some more property investments to my portfolio. As usual, I reviewed the platform using my own money, and I'll show you all the features of the platform, how to invest, and at the end of the review share my results with Crowdestate.

Crowdestate
My Overall Rating
My Average Yield
13.72%
Investment Protection
What I Liked
Projects with great returns
Wide diversity of projects types
Auto-invest function
Secondary market
What I Didn't Like
Not enough new opportunities

I can definitely say that I am really happy so far with Crowdestate. The platform is really easy to use, and I really love the fact that they carefully select the deals they put on the platform. Also, as it's mainly real estate projects, all loans that you invest in are always secured by the property itself, meaning that even in case of default there is a very good chance you will get your money back. So far the platform returned interests in the range that was announced and no defaults at all. They also have a very strict process to select deals that end up on their platform, and their team is highly experienced in the real estate market.

Therefore, I really recommend that you try out Crowdestate. It's a great way to start investing in completely passive real estate by investing in high-quality real estate projects or to diversify an existing portfolio.

The Crowdestate Platform

Crowdestate is a real estate crowdfunding platform based in Estonia, that mainly offers to invest in real estate development loans in Europe. The projects that are on the platform are usually from a duration of 1 to 4 years, and have very nice yields, usually above 14%.

Crowdestate Review (November 2019 Update)

The nice thing with Crowdestate is that they really carefully select the deals that they put on their platform. As they mention on their site, only 5% of the projects that they examine actually end up on the platform. Note that they also have some more business related loans, but that's only a small part of the projects that are available.

I actually had the opportunity to visit Crowdestate at their office in Tallinn in September 2019 and it was awesome! I met the whole team and we had a day trip with the CEO of Crowdestate Loit Linnupõld to see projects that are listed on the platform, as well as past projects. It was so nice to see what projects listed on the platform actually look like, and to see how investors' money can help create great real estate projects. Here are some pictures from this visit:

Crowdestate Review (November 2019 Update)

Crowdestate Review (November 2019 Update)

Opening an Account

The first step is to actually open an account on the platform. This was really easy to do on Crowdestate, and took less than 5 minutes:

Crowdestate Review (November 2019 Update)

Note that there is an ID/passport verification step that is needed if you want to withdraw money, but you don't have to do it when you open the account. I did it after I already invested, and it was a very smooth process as well.

Once your account has been opened, you can then deposit money on the platform via a bank transfer. This was really easy to do, and the money (I started with 200 Euros) was on the account within 2 days.

Browsing Deals & Making the First Investment

Once I deposited money on the platform, it was then time to have a look at the current projects on the platform. The thing to note here is that as the projects are all carefully selected by Crowdestate, and as there are many investors on the platform, there are usually not that many projects available and they tend to go fast. However, there are ways to solve this 'issue' using the auto-invest function or the secondary market, which I will tell you about in the next section of this article.

Those were the projects available on the platform when I wrote this review:

Crowdestate Review (November 2019 Update)

As you can see, one project is a real estate development project and the other one is more like a business loan. When you click on a project, you can access a much more detailed description of the project:

Crowdestate Review (November 2019 Update)

This is a typical project that you will see on the platform, which is a secured real estate development loan in Milan, with a term of 2 years. For most projects, you will get interests payment through all the term of the loans (for example every 6 months for this one), with a larger payment of the principal plus remaining interests at the end of the term. Therefore, it's a good strategy to invest in new projects every month to end up with a regular flow of income on this platform. Note I didn't invest in this particular project however as the yield was a bit too low compared to what you can usually find on Crowdestate.

Automating Your Investments

The best way to make sure to invest in new deals that fit your criteria (and automate your investments in the long term) is to use the auto-invest function. Indeed, with the auto-invest function activated, you will be sure to automatically invest in new deals if they fit your criteria, before every other investor that invest manually in projects. It's also very easy to set on Crowdestate, and you can really precisely set in which deals you want to invest. Here are my current auto-invest settings:

Crowdestate Review (November 2019 Update)

As you can see on the picture above, I chose to only invest in real estate projects, with the minimum amount of 100 Euros per deal, 12% minimum yield, 2 years maximum term, and a low level of risk. So far the function has been working great, and invested in several deals that I would have missed otherwise.

Using the Secondary Market

As I mentioned before, there are usually not that many new projects available as they get funded very quickly on the platform. Luckily, Crowdestate has a very good secondary market, with a lot of projects available, which will allow you to diversify your investments even if you are brand new to the platform. This is a view of the secondary market when I wrote this review:

Crowdestate Review (November 2019 Update)

 

As you can see, there are many real estate development projects on the secondary market, with yields up to 15%, and without huge premiums (the additional price you pay when buying on the secondary market). In fact, I bought most of my current portfolio on the secondary market, and I didn't pay more than 2% of premium on all the deals I invested in. It's also very easy to browse deals on the secondary market, and filter them by the remaining term, price, and expected rate of return.

My Returns on Crowdestate

Let's now see my current returns on the Crowdestate platform. Here is a screenshot of part of my portfolio on the platform when I first wrote this review:

Crowdestate Review (November 2019 Update)

So far, I gained 43.08 Euros on the platform, with an expected future yield of 13.73%, which perfectly makes sense as I invested in projects that yield around 14%. Note that I didn't have any defaults so far on the platform, and only one project was slightly late in one payment, but they paid the full amount a few days after the due date. Crowdestate also provides other quite nice graphs to show you the current state of your portfolio, for example, the evolution of your portfolio value over time:

Crowdestate Review (November 2019 Update)

You can see that after the initial investment of 200 Euros, I added money two additional times on Crowdestate, as I was really satisfied with the platform & with my early results.

Update November 2019: It's now been over a year that I invested on the platform, so let's have a look at the current situation of my portfolio. I didn't add additional funds on the platform (as I wanted to diversify on other platforms), and just let it grow by itself with the auto-invest functions. Here is the current total of my portfolio:

Crowdestate Review (November 2019 Update)

So far, I still didn't have any defaults in the project I invested in. As I mentioned earlier, a lot of the projects on the platform are long-term, therefore I only expect most of the gains coming about 12 to 18 months after my first investments. However, it's interesting to see how did the projects that already ended since I invested in them:

Crowdestate Review (November 2019 Update)

Some of the returns were a bit lower than expected, but so far on average I still got a yield around 14% - which is better than other similar platforms. So I can say that so far, I am still very satisfied with Crowdestate

Should You Invest?

I can definitely say that I am really happy so far with Crowdestate. The platform is really easy to use, and I really love the fact that they carefully select the deals they put on the platform. Also, as it's mainly real estate projects, all loans that you invest in are always secured by the property itself, meaning that even in case of default there is a very good chance you will get your money back. So far the platform returned interests in the range that was announced, with a nice yield of nearly 14%, and no defaults at all.

Therefore, I really recommend that you try out Crowdestate. It's a great way to start investing in completely passive real estate by investing in high-quality real estate projects or to diversify an existing portfolio. I will for sure keep on adding money on the platform in the coming months, and will, of course, share my results on this website.

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Akarsh 2 days ago
Yea I would agree with Tobias - I think this article does need an update as it focusses on the Positives of CrowdEstate but not the negatives. Bad Customer Support, Unclear responses and bad project management. I have been making investments in CrowdEstate for a few years now but have finally decided to try and close out my accounts. If you are good at self serving and figuring out the details yourself it might still be usable as a general consensus between a few of my friends and I. Every time I have contacted their support they have been extremely curt and just refer me back to their project summary or some other page, despite detailed questions. One of their projects "Tammelehe project" has been overdue for 5 months - luckily one of the smallest investments I made. At no point did Crowdestate send a proactive email out to let me know the project had problems or what the next steps are. I have had to contact them since then to ask for resolution and still waiting for it. They just put a news article on their website which by the way is not often and unless you are checking their website everyday you arent sure what is happening with your investment that is in jeopardy.
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Tobias 25 days ago
Hi Marco, I guess it is time to update your review. I was very happy with the platform myself, but now some first projects seem to default. I am invested in the project H.M. Seafood and they seem to be bankrupt. Let's see how they handle the default. But it is very alarming that a project with a very low risk, according to their risk assessment, is going to fail.
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Ion a month ago
Hello, in the beginning of this post, it says "no defaults at all". Looking at the offers on the secondary market, I see several projects (5 to be more exact) being late, some even 10 months. Ignoring those that are just a few days late, at the time of writting this post, there already were some projects in trouble. Maybe my definition of default differs from yours, but when a loan is several months late, I consider that the invested money is lost.
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Marco Schwartz Ion a month ago

Hi, that's a good point, the CEO of Crowdestate actually went over this topic when we met in Tallinn. There are indeed a few projects that take a lot longer than expected due to legal issues for example but are not considered as default as there is ongoing work with them and they are still confident that money will be paid back to investors. So indeed I count defaults only as they are considered as defaults by the platform.

Peter 5 months ago
Hi, Marco! Thank you for nice review! Yesterday I signed up via your refferal link. I was wondering how you choose projects on secondary markt. At the moment I see many offers with high premium but when I recalculate it to the total return I would get in case of project success, the percentage would be higher than the interest of the project. Is it really safe? I saw also on some loans, that there are yealds in case of the best scenario and the worst scenario and it is quite confusing for me because in worse scenario I could teoretiacly loose money. What is your practical experience? Peter
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Marco Schwartz Peter 4 months ago

Hi Peter, nice! I have to admit that for now I mostly invest in new projects. However I'll report that back to Crowdestate and then report in my review about it :)

M a year ago
Is this a paid article ? What about platform risks ? According to website - there are only 4 employees.
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Jay M 10 months ago
Second the above comment. Would like to get some more info as well on platform risks and affliation of the author with the site
Marco Schwartz M 6 months ago

Hi, this is not a paid article - I always put my results with the platform I invest in, and only I decided what to include in the article, not the platforms :) In the case of Crowdestate, I state in the article that the risks are indeed higher than other platforms as their interests rates are also higher. So far (by May 2019), the platform is returning what was expected, with only some slightly lower interests rates on some projects.