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7 Best Real Estate Crowdfunding Platforms For Passive Income

Real estate crowdfunding has become a popular investment choice for individuals seeking to earn passive income without the need for direct property management or large capital requirements. By pooling resources, investors can buy fractional shares in real estate projects, diversifying their portfolios and potentially earning attractive returns from properties like commercial buildings, residential developments, and industrial complexes. Here are seven of the best real estate crowdfunding platforms to consider for building passive income.

1. Fundrise

Fundrise is one of the most recognized names in real estate crowdfunding, catering to both beginners and seasoned investors. The platform offers a simple, user-friendly interface that allows investors to diversify into residential and commercial real estate projects across the U.S. Fundrise is unique for its "eREITs" (electronic real estate investment trusts), which pool investor funds into diversified portfolios managed by the platform's real estate professionals.

Fundrise has a low entry threshold, with a minimum investment starting at $10, making it accessible to almost any investor. It also offers several account levels—from Starter to Premium—with each tier providing varying access to real estate assets and exclusive deals. Investors typically enjoy quarterly dividend payouts and can also benefit from long-term capital appreciation.

Key Features:

• Minimum Investment: $10
• Types of Properties: Residential and commercial real estate
• Ideal for: Beginners looking for a low-cost entry and diverse portfolios
• Returns: Average historical annual returns range from 8% to 12%

2. RealtyMogul

RealtyMogul focuses on institutional-quality real estate projects, such as multifamily apartments, office buildings, and retail centers. The platform offers two main REITs: MogulREIT I, which is primarily income-focused, and MogulREIT II, which targets growth through multifamily apartments. RealtyMogul is known for its due diligence process, selecting only a small percentage of projects that meet its strict criteria.

While some offerings are open to all investors, many opportunities on RealtyMogul are only available to accredited investors. RealtyMogul’s transparency, coupled with its commitment to high-quality investments, makes it an attractive platform for those seeking vetted real estate opportunities.

Key Features:

• Minimum Investment: $5,000 for REITs and higher for other investments
• Types of Properties: Multifamily, office, retail, and industrial real estate
• Ideal for: Accredited investors seeking vetted, institutional-grade opportunities
• Returns: Average returns vary by REIT but are typically around 6% to 8% annually

3. CrowdStreet

CrowdStreet is a popular choice for accredited investors seeking access to high-quality commercial real estate projects across the U.S. CrowdStreet offers a wide variety of projects, including single-property deals, diversified funds, and tailored portfolios based on investor preferences. Each project on CrowdStreet is vetted by the platform, and investors can view detailed information on each deal before committing funds.

One of CrowdStreet’s standout features is its Marketplace, where investors can browse projects and funds based on criteria such as location, property type, and return profile. With an emphasis on transparency, the platform provides extensive data on each project and allows direct communication with the project sponsors.

Key Features:

• Minimum Investment: $25,000
• Types of Properties: Commercial real estate, including multifamily, office, and industrial
• Ideal for: Accredited investors looking for hands-on control in a marketplace environment
• Returns: Average annualized returns between 8% to 20%, depending on the investment

4. Yieldstreet

Yieldstreet is a unique platform offering a broad range of alternative investments, including real estate, art, legal finance, and marine projects. Its real estate offerings are primarily available through structured debt and equity deals, which can appeal to investors interested in high-yield opportunities with shorter-term horizons.

Yieldstreet’s minimum investment is higher than some other platforms, making it ideal for more experienced investors or those looking to diversify into non-traditional assets. Its short-term debt products typically offer monthly interest payments, which can provide a consistent stream of passive income for investors.

Key Features:

• Minimum Investment: $500 to $10,000, depending on the product
• Types of Properties: Debt and equity deals in commercial and residential properties
• Ideal for: Experienced investors seeking high-yield, short-term real estate opportunities
• Returns: Target returns of 8% to 15%, depending on the investment type

5. DiversyFund

DiversyFund offers a unique approach to real estate crowdfunding by focusing on multifamily apartment buildings that are renovated and sold for profit. Unlike other platforms, DiversyFund does not charge management fees and reinvests profits back into the properties to maximize appreciation. This makes it a particularly attractive option for investors focused on long-term growth rather than immediate income.

The platform is open to non-accredited investors, with a minimum investment of $500. Investors in DiversyFund’s Growth REITs can expect long-term returns from capital appreciation, making it suitable for those who don’t need immediate liquidity but want exposure to real estate as a wealth-building tool.

Key Features:

• Minimum Investment: $500
• Types of Properties: Multifamily apartment complexes
• Ideal for: Non-accredited investors focused on long-term growth
• Returns: Target returns between 10% to 18% annually through property appreciation

6. EquityMultiple

EquityMultiple is a crowdfunding platform focused on institutional-quality real estate investments. It offers three types of investment opportunities: syndicated debt, preferred equity, and equity. EquityMultiple provides transparency in the selection of projects, offering detailed information and data for each opportunity. The platform is limited to accredited investors, with a minimum investment starting at $5,000 for debt deals and $10,000 for equity.

EquityMultiple’s deal structures appeal to investors looking for income-generating real estate investments as well as potential for equity appreciation. The platform’s projects span a variety of property types, including multifamily, office, and industrial spaces, with a focus on stable cash flow and risk-adjusted returns.

Key Features:

• Minimum Investment: $5,000 to $10,000
• Types of Properties: Syndicated debt, preferred equity, and equity in commercial properties
• Ideal for: Accredited investors looking for a mix of income and growth
• Returns: Average annual returns range from 7% to 12%

7. Groundfloor

Groundfloor is a unique platform because it allows both accredited and non-accredited investors to invest in short-term, high-yield real estate debt. With a minimum investment of just $10, Groundfloor is highly accessible and ideal for those new to real estate investing. The platform funds single-family residential renovation loans and other real estate projects, making it more focused on the "fix-and-flip" market.

Groundfloor’s approach allows investors to earn passive income through monthly interest payments, with loan terms ranging from 6 to 12 months. The platform provides extensive information about each loan, including borrower history, loan-to-value ratios, and repayment schedules.

Key Features:

• Minimum Investment: $10
• Types of Properties: Residential renovation loans and fix-and-flip projects
• Ideal for: Non-accredited investors seeking short-term, high-yield real estate debt
• Returns: Annual returns range from 8% to 12% on average

Choosing the Right Real Estate Crowdfunding Platform for You

When selecting a platform, consider factors like minimum investment requirements, types of properties, expected returns, and your level of experience. Real estate crowdfunding platforms differ in their fee structures, types of investment opportunities, and the degree of risk and involvement they require. Here are some key considerations:

• Accessibility: Platforms like Fundrise and DiversyFund are accessible to non-accredited investors and have low minimum investments, making them ideal for beginners. For more experienced or accredited investors, platforms like CrowdStreet and EquityMultiple offer access to larger, institutional-quality deals.

• Return Expectations: While most platforms offer attractive returns, each has different risk profiles. Debt-based platforms, like Groundfloor and Yieldstreet, typically provide more immediate income through monthly payments, whereas equity-focused platforms may offer long-term capital appreciation.

• Fees and Transparency: Some platforms, like DiversyFund, stand out by not charging management fees. Be mindful of fee structures, as they can significantly impact overall returns.

Conclusion

Real estate crowdfunding provides an accessible way for investors to generate passive income and diversify into real estate without the challenges of property ownership. Each platform listed offers a unique approach to real estate investing, from short-term debt to long-term equity projects, making it possible to tailor your investments to your financial goals. By selecting the right platform, you can harness the power of real estate to build passive income, achieve diversification, and potentially grow your wealth over time.