What is fundrise.com? What can you expect from it as an investor? How good are the deals that it offers? What, actually, are the deals that it offers, that you can start taking advantage of? Let’s find out about this and more in today’s review about this very popular platform.
Name of the company: Fundrise
Official Website URL: https://fundrise.com/
Overall Rating: (3 / 5)
Table of Contents
- What is fundrise.com?
- How does Fundrise work?
- What are you investing in? (as the investor)
- Which are some of the main features of Fundrise?
- Which types of deals are offered on this platform? (How to invest through Fundrise)
- Is Fundrise Legit or is It A Scam?
- Pros and Cons
What is fundrise.com?
Fundrise.com exists as a real estate investment platform that allows investors to make an income through an approach known as crowdfunding. With crowdfunding, investors usually pool their funds in a bid to purchase lucrative properties.
Ben Miller, the CEO of this company started Fundraise with the idea that he’d make investing in real estate a possible reality for everyone. Most people are often incapacitated by the high capital requirements when it comes to taking a slice of the pie in this industry, which is why crowdfunding solutions are growing in popularity.
Fundrise was started in 2012, and it has since then invested more than $4 billion in various real estate projects in the country. The company is currently valued at $800 million and has over 130,000+ active investors who have entrusted it with more than $500 million in assets that are under management.
How does Fundrise Work?
Investors who sign up for Fundrise usually have the option to invest in:
- Low-minimum Starter Portfolio
- One of the 3 Core Portfolio plans.
Regardless of the option you pick, Fundrise will see to it that the funds you present to them are invested in their allocated assortment of eREITs, as well as eFunds that consist of lucrative private real estate assets in the US. Fundrise will see to it that your allocations are tailored to meet your personal investment preferences.
As much as the results will vary depending on the plan that you pick, you will get your payouts in the following ways:
- Quarterly dividend distributions
- The appreciation of the value of the underlying assets. Note that this company’s portfolios are long-term in nature, hence the earnings from property appreciation may not come overnight, and cannot also be guaranteed.
What are you investing in? (as the investor)
As we’ve already seen, you can make your money on this platform by investing through the Starter Portfolio, or Core Plans.
Here, you’ll need $500 to begin investing. With this amount, Fundrise will allow you to set up your Starter Portfolio and access a mix of real estate projects in the USA (diverse projects). You’ll have to pay a 0.15% annual investment advisory fee, as well as a 0.85% annual asset management fee.
For this portfolio, your funds will be allocated to a blend of this company’s Growth eREITs and its Income Ereit II, for which the income will be received as quarterly dividends, along with the appreciation of share value.
The Core Plans will cost you $1000 for the minimum investment, but they’re better than the Starter Portfolio because they offer access to a wider array of investment strategies and account features. There are 3 different investment plans for this option, which include:
- Supplemental income –for the income-focused assets
- Balanced investing –for the equal blend of income-focused assets and growth-focused assets
- Long-term growth – for the growth-focused assets
All the above plans also offer:
- Dividend re-investment
- Discounts for referrals
Which are some of the main features of Fundrise?
Fundrise tries to establish its competitive edge in the market by offering unique features that it hopes will attract investors to it. The main features of this platform include:
- The capability to invest using a Self-Directed IRA
- Goal-based investing – You can now invest based on your goals, as opposed to the available investment types or the location
- Fundrise IPO –you can allocate 25% of your current account balance to invest in this company’s IPO.
- You can invest through an eFUND-this is a private fund that lets you invest in multiple commercial real estate properties.
- The Fundrise eREIT-this is a non-traded REIT that lets you invest in multiple commercial real estate projects as you cut out the middleman and save big on commissions.
Which types of deals are offered on this platform? (How to invest through Fundrise)
From the information presented above, it’s easy to tell that this company is mainly concerned with offering eREITs and eFUNDs that investors can purchase as they expect to make an income in the future. The good thing about these two investment vehicles is that they give investors the chance to invest in multiple commercial real estate projects.
Is Fundrise Legit or is It A Scam?
Fundrise is a genuine platform, in my opinion. With the reviews given by investors on Trustpilot, there’s no doubt that this platform is existent. We already saw that it has more than 130,000 active investors who are all relying on the deals its offering to make an income.
With a rating of (3/5) stars on Trustpilot, I think Fundrise is one that can be termed as average. I looked at the distribution of the customer reviews and discovered that 85% of the customers think that its deals are excellent, and 9% think that its deals are bad. This simply reveals that it’s possible for one to walk away very satisfied with what is being offered, but they can also get disappointed by the outcome. Generally, those investors who give this platform one or two stars are not happy with the rate of return, and state that they expected 8-10% as promised, but ended up getting less than 5% (at times even less than 1%).
I’d therefore advise that you do your due diligence before investing in any of Fundrise’s deals, or you can simply take a look at what other alternative companies in different industries have to offer.
Pros and Cons
- Low minimum investment
- Open to all types of investors
- Easy to use website
- You can use an IRA to invest
- Investment is highly illiquid
- Fees are hard to understand
- Due diligence needed since investment models are complex.
Do you own or represent Fundrise?
If you are a representative or associate of Fundrise have found something not to be correct in this review please, feel free to tell us and I will make sure to update the info on this post. The easiest way to do it is in the comment section below or simply by sending us an e-mail to email@example.com.
Final Words and Verdict
Overall Rating: (3 / 5)
Fundrise generally meets the requirements for what we’d term as a decent crowdfunding platform. The number of investors who have trusted in its capability to deliver good returns speaks for itself, though I’d still generalize its success. You still need to do your due diligence to ensure that you’re getting yourself into something that you have sufficient information about. Alternatively, you can check out what other stable and reliable long-term investment assets have to offer.
That will be all for today’s review on what fundrise.com is about and what it has to offer. Do you have any questions about its features or deals? If yes, you can leave them in the comments section below, I’ll get back to you ASAP.
I wish you well,
Eric, Investor and Team Member at Gold Retired!