Real estate prices have soared over the years in certain locations around the world (we’re looking at you Vancouver). While not everyone has the cash flow to invest in properties, there is a way in for the everyday person with low-cost real estate investments to diversify your portfolio with an easy-to-use platform. Let’s take a closer look at Fundrise.
What is Fundrise?
Let’s start by answering the million-dollar question – is Fundrise legit? Yes, it is! It is not a scam at all, but whether or not it’s the best choice for everyone depends on your investment profile and goals.
Fundrise advertises low fees and very low minimum investments for something as vast as the real estate market, which makes it very appealing to most. Fundrise is a crowdfunding platform with the longest history and the largest scale in the real estate industry.
You can make some pretty decent returns on the platform, with an average of 10.3%. The fees are as low as 1% without a minimum balance limit. The minimum investment amount is just $500, but that’s if you go for the basic profile. The minimum investment amount increases with each plan up to $100,000 for the premium account.
Fundrise offers various investment portfolios including eREITs (Fundrise’s version of REITs – Real Estate Investment Trusts). The customer support and transparency the platform offers clients can help erase much of the doubt potential customers have, which further supports the legitimacy of Fundrise. Not to mention, they have an A+ rating at the BBB (Better Business Bureau).
Should I Go for Fundrise?
Low fees and low minimums always sound good, but is Fundrise really the best real estate investment option for you? Real estate is usually a sector for investors with a long-term outlook rather than those looking for quick returns. If a slow and steady investment approach describes you, then Fundrise is a great option.
Diversification is also a primary attraction of Fundrise. For those looking to venture out of stock and bond investing, Fundrise is a great way to bring variation to an investment profile.
Potential investors should be aware that due diligence should still be carried out with any type of investment, and the same goes for Fundrise.
Fundrise Pros and Cons
Nothing helps consumers make an informed decision faster than a quick checklist of pros and cons.
- Non-Accredited Investors Rejoice!
The platform is open to non-accredited investors, which expands Fundrise’s reach. Accredited investors are those who have a huge net worth of more than 1 million, one that’s not easily attainable by the everyday person. By allowing non-accredited investors to take part in real estate investments, Fundrise evens the playing field a bit more.
- Low Minimum Investments and Fees
As said, the platform sets low minimums for accounts and a 1% fee annually. Yes, there are set minimums depending on your account choices, but they are considered low in comparison to your investment capital.
- Multiple Ways to Invest
Fundrise offers various portfolios and account levels to help you strategize the best way to invest. You have the Starter Portfolio, which lets you enter the real estate investment sector with as little as $10.
The $1,000 minimum Basic Plan gives extra perks including dividend reinvestments, IRA investing and auto-investment features.
The next tier up is the $5,000 Core Plan, which unlocks even more with added investment plans. You then get up to the Advanced and Premium Account levels, which have a minimum of $10,000 and $100,000 respectively, that offer larger investment amounts.
- Easy Platform
Getting set up and started is easy. The platform is straightforward and simple to maneuver. You don’t have to be a well-versed investor to understand what each feature is for. Yes, you have to enter some sensitive information such as your address and Social Security number, but don’t worry, your information is safe. You can then choose to link your bank account to manage all your activities and transactions.
Fundrise offers plenty of other features as well from redemptions to non-traded REITs. One thing to keep in mind is that there may be additional fees such as liquidation fees and development fees that accompany your transaction.
- Not for Short-Term Gains
Real estate investments through Fundrise are recommended for those with a long-term vision. We’re talking about letting your money sit for a minimum of 5 years to do its job. If you have the money to spare and the patience to wait, then Fundrise is a great place to park your money and let it do its magic.
Fundrise is a legitimate company that opens many doors for investors. Whether it’s to diversify your existing profile or to dabble in the real estate investment market, Fundrise has the tools to make it happen. The platform is great for investors who have long-term goals, but like any type of investment, it does come with risks. This is why it’s important for investors to carry out due diligence before taking action. Click here to learn more about investing with Fundrise.