If you've been thinking about getting into real estate investing, you've probably heard the same things that lured many in:
"Real estate always goes up."
"It'll be easy to find a renter because everyone needs a place to live."
"You can make a ton of money with property management."
This all sounds very promising, but not everyone has been allowed to invest in real estate. You had to meet certain criteria based on your income, net worth, asset size, or professional experience.
That was prior to the enactment of the JOBS Act of 2012.
It’s been a decade now since the bill was signed into law. Real estate investing has changed. You no longer have to be a millionaire or a professional financial advisor in order to make your money grow via real estate. For example—crowdfunding platforms like Crowdstreet and EquityDoor allow those with smaller budgets to get involved in real estate investing, too.
Let’s take a look at some of the benefits of real estate investing through Crowdfunding.
One of the best things about real estate crowdfunding is that it allows you to diversify your portfolio. Portfolio diversification is the practice of splitting your investment capital into several different ventures in order to minimize the risk associated with any one of those ventures.
If you put all your money into one investment vehicle, and it fails, you'll lose all your money. But if you put that money in many different investments, you'll be able to weather the storm if one or two of those investments fails.
Traditionally, real estate investing has been dominated by large parties in investing like banks, investment houses, and wealthy individual investors. But after the signing of the JOBS Act, regulations have been eased to allow smaller investors to participate. Many real estate projects now allow investments from as low as $1000.
Typically, it is the investment advisor who makes the decision of where to invest your money based on an investment suitability form. In the case of traditional IRAs, it is the IRA custodian who makes decisions with the goal of preserving your money for retirement.
It may sound convenient, but you are getting less in the end because of the fees involved in having someone else manage your investments. In real estate crowdfunding, you choose which projects you want to invest in.
Investing in real estate is usually a time-consuming and physical process. Investors have to visit properties, meet with the owners, and see if the investment is worth their while.
This can be hard work, but it's a lot easier with the help of crowdfunding platforms like EquityDoor. Investors can access information about potential investments online through its real estate marketplace and make educated decisions. It's a much more convenient way to invest in real estate than traditional methods.
In the past, investing in real estate was a time-consuming and expensive process. You had to be a high net-worth individual and go through meetings with lawyers, financial advisors, and bankers. You had to submit dozens of different documents, and even then there was no guarantee that your application would be approved. But now, with platforms like EquityDoor, you can invest in real estate through crowdfunding. With crowdfunding, your investment becomes part of a fund that is managed by professionals who have experience selecting winning properties for other investors. There are no complicated contracts or legal documents, and by investing through crowdfunding, you get all the benefits of traditional real estate investing without the headache.
Watch the video tutorials below and see how easy it is to invest in real estate through EquityDoor's Crowdfunding Portal.