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If you’re looking to become a real estate investor, Fundrise aims to make it easy. Their unique structure makes it one of the most accessible options for non-accredited investors.
Throughout its existence, Fundrise has become a reliable platform to invest in. By the end of 2020, Fundrise generated a 10.11% average annual return.
Outperforming various other real estate platforms, Fundrise gives users access to great real estate deals without the typical high dollar amount.
To give you a better understanding of Fundrise, we’ve compiled a detailed Fundrise review explaining the features, advantages, disadvantages, and other things to be aware of when investing in their platform.
What is Fundrise?
With over 150,000 active investors and more than $5 billion in total asset transaction value, Fundrise is one of today’s most reliable and popular real estate crowdfunding platforms.
Founded in 2012 in Washington, DC, Fundrise aims to make private real estate investment opportunities available to all investors, regardless of your accreditation.
Fundrise has some of the lowest minimums compared to other real estate investment platforms, with a plan that lets you invest as little as $500.
According to their statistics, Investors using Fundrise have earned over $100 million in total net dividends.
The investment platform also boasts an easy-to-use interface and account structure.
Fundrise is continually changing the world of modern investment. In 2015, the platform shook the online crowdfunding space by introducing the eREIT.
An eREIT is essentially a real estate investment trust available online. Fundrise created this product to make investing in commercial real estate more accessible to investors of all accreditations.
Combining all its main features, Fundrise has something to offer for all investors as it continues to make investment opportunities in private real estate available to everyone.
Fundrise Features You Should Know About
One of the key features of Fundrise is that it’s made available to average, nonaccredited investors. While other investment platforms are only available to wealthier investors and charge higher fees, Fundrise features several beneficial products that are available to all investors.
If you’ve been searching for ways to get into private real estate but don’t have a lot of money to work with, Fundrise charges considerably low minimums for investors.
It’s also incredibly easy to use. You can create an account in less than 10 minutes by providing some information.
Then, decide whether to fund your account by filling in your bank information through wire transfer (or on your own) or simply linking to your bank account (also called an ACH transfer).
If you’d like to sell your shares back to Fundrise, the platform also features a redemption program (with a fee).
By paying into the eREIT or eFund, that fee is determined as a reduction to the value of the share price:
0% if within the first 90 days
3% if within 90 days, but under 3 years
2% if within 3 years, but under 4 years
1% if within 4 years, but under 5 years
Keep in mind that there’s no reduction to retrieve shares after reaching the five-year mark.
If you’re looking for a more readily available option, Fundrise offers investors the Interval Fund feature, which allows for more direct access to the money you’ve invested through quarterly repurchase propositions.
And unlike eFunds and eREITs, there’s no drawback for using shares in the Interval Fund once each quarter of the year.
Since it can hold more assets, Interval Fund is the largest product out of all Fundrise funds. Interval Fund might also offer higher diversity than other funds while also giving investors the same benefits of using eFunds or eREITs.
Advantages and Disadvantages of Using Fundrise
This section will outline the key advantages and disadvantages of using Fundrise for real estate funding.
Fundrise offers some of the lowest minimums, starting at just $500. Users can set up an automatic recurring investment. With relatively low fees, Fundrise features diverse funding options.
Designed to make private real estate investing a simpler process, the platform is also straightforward to navigate. And you don't have to be an accredited investor to invest in more sophisticated real estate strategies.
There are a few drawbacks you should be aware of when investing with Fundrise.
For example, investors don’t have the ability to invest in property deals or individual Fundrise REITs. And it may be tricky to completely exit your investment position all at once.
It’s worth considering that Fundrise doesn’t make money through the fees it charges its investors but rather generates the majority of its revenue from charging developers an origination fee.
Investors rely on the Fundrise administration to select the ideal investment options, this could potentially create a problem in its due diligence.
Fundrise: Full Review
Fundrise is an online real estate investment corporation, ideally for ordinary investors. It allows users to invest in residential, commercial, and private properties by combining their holdings into a single platform.
Fundrise primarily allows users to invest in REITs (real estate investment trusts). This deals with funding in real estate that produces income, either by holding mortgages or through buying and managing buildings. Fundrise refers to its products as “eREITs.”
Fundrise offers more diversification through eFunds, where investors pool funds to purchase property, build houses, and sell them to interested buyers.
Additionally, users may purchase an Advanced or Premium account. Premium members have access to a larger amount of real-estate ventures.
In summary, Fundrise is a great investment platform for long-term investors willing to do their due diligence and looking to diversify outside stocks and bonds.
Is Fundrise Right For You?
Fundrise is one the most popular and commonly used online real estate funding platforms available. There are many appealing factors when it comes to real estate, and Fundrise makes it easier for you to navigate.
If you’re an investor with a long-term outlook and looking to add some diversity to your portfolio, Fundrise might be the best choice for you.