Fundrise vs. Realty Mogul vs. Crowdstreet

Daniel Penzing
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About Fundrise

From buying my first apartment in Washington, DC, to eventually buying a small commercial property in Philly, I’ve been around the block (including online) on real estate investing.

As with most “brokerage websites,” you can easily get lost in reviews, names, numbers, and the whole industry lingo. Our goal is to educate you on the basics of investing in real estate.

No insider knowledge required.

You’ve likely seen a REIT or Crowdfunding site before if you have any interest in real estate or real estate crowdfunding …that’s how prevalent it is on the web. There are a dozen different real estate investment platforms, but some simply allow you to buy into real estate properties through their stock. Other sites, like Realty Mogul, allow you to co-invest in a real estate project.

Fundrise is another standalone real estate investment platform, but it allows you to invest for a longer term (10+ years). They have more than 100 syndicates (properties) to choose from and have grown exponentially since their launch in 2012.

About Realty Mogul

Commercial real estate is a hot topic. The only problem is that it's incredibly difficult for an individual to break ground. Unless you are a seasoned investor, it’s generally difficult or nearly impossible. Realty Mogul is a way to get into the game without having to be an expert. Realty Mogul is backed by Y Combinator, so the company is aiming big. It bills itself as the largest real estate investment platform in the world.

The idea behind Realty Mogul is to make important real estate investment decisions more accessible to the common investor. Whether you want to invest a little or a lot, you can do it through Realty Mogul. Along with letting the investor choose, Realty Mogul also allows for the investor to choose what they are willing to risk. They can pick from a wide variety of things, like commercial real estate, gold, or international stocks. It doesn’t matter if you are a seasoned investor or have never made an investment in your life, it’s all part of the offering of Realty Mogul.

About Crowdstreet

While Crowdstreet may not be one of the most well-known real estate crowdsourcing platforms, it does have some great features that could be attractive to real estate investors. Some of the benefits include:

The Tenant Tracker is where this platform really shines. It gives real estate investors the ability to take a closer look at their tenants, who they are, where they live and other details that can indicate their risk profile. From there, investors can make a more well-rounded decision about whether or not to fund the tenant and what type of investment arrangements would be best.

A full-featured dashboard, so investors can make quick gains from many different tenants and properties in many different environments.

Investing in Crowdstreet real estate is easy as pie, and its usability is also very strong, making it a great platform for beginners.

This platform is great at facilitating communication between tenants and investors. Any issues that arise can be easily reported and managed.

Crowdstreet does things differently than many other real estate crowdsourcing platforms. It takes a more hands-off approach to helping investors succeed in their real estate investments.

How Are They the Same?

All three websites have two basic things in common. The first is that they are platforms that bring accredited investors and property owners together so that the property owners can raise capital to invest in property. The second is that even though the property owners are buying real estate, they are not required to manage or maintain the property. This is a huge benefit to the property owners since they can list their properties with the platforms and focus on other things, while the platforms take care of the rest.

The second thing the three platforms have in common are their basic tenets. While they all have slightly different philosophies in some aspects, they have some things in common in their application process, the commission and fee structure, the type of property they focus on, and they all have the following three tenets in common:

No profits to investors until the property is sold. Commission is paid to the platforms and not those selling the property. Property owner retains power of attorney, which means they control their property.

How Are They Different?

Before you dive in and start looking at the details and features that each of these crowdfunding real estate platforms offer, it is best to understand how they compare to one another with respect to the key features and functionality.

If you go through each of the websites, they all offer something unique to the average person.

For example, Realty Mogul is definitely laser-focused on providing both personal and professional investment opportunities. They are interested in providing you the best opportunities and the best information to make informed investments when you have gone through the platform.

Then you have Fundrise, which really is more interested in providing your team of investors the best opportunities available. They are more detailed and more professional and truly want to be the best choice for your financial goals and needs.

It is important to understand the difference between these crowdfunding real estate platforms because you do not want to select a platform based on only one aspect or perspective of it. You want to select the platform based on all of the different characteristics and traits, as well as how they all fit together. Once you have gone through each one and have a side-by-side comparison, you will know which one is the best choice for you and your overall goals.

Unique Features

Features Unique to Fundrise

Security Features: In order to manage your wealth, Fundrise has a sophisticated fund management platform that allows them to keep your investments safe. They have a variety of detailed security measures that are implemented to ensure that your money is safely tucked away and accessible by you.

Exit Strategy: One of the biggest concerns of investors is how they can make sure that their money is safe. One of the biggest reasons why new investors stay away from investing in real estate is because of the difficulty that comes in liquidating your investment. Fundrise manages your investments with a specific exit strategy in mind. They have tools that help them handle your money in a professional manner.

Value Appreciation and Diversity: At Fundrise, you can expect to earn a high degree of investment return value before you are allowed to withdraw you investment. Apparently, they have an algorithm that is designed to ensure that you get a higher percentage of your investment. The only problem with this is that you will have to wait until your investment value reaches a certain level to be able to withdraw it. Additionally, you can expect to have an appreciating value for your investment in the future.

No Sales commissions: The best part about investing in Fundrise is that you will not have to worry about paying any sales commissions during the time of your investment. Even if Fundrise manages to sell your investment at a higher value, you will still only receive the original amount that you invested.

Features Unique to Realty Mogul

Realty Mogul opens up the world of real estate investing to non-accredited investors.

In previous iterations of the JOBS Act, individuals who could invest in real estate had to have a certain income. Those who didn't meet that requirement wouldn't be able to invest. Through the use of SEC rules, Realty Mogul was able to open up the market.

Another unique aspect of Realty Mogul is that it has an online community aspect to it. You can connect with other people who are interested in real estate so that you can learn from other people or get advice on properties that you might be interested in.

You can also access the Realty Mogul support team every day of the week, from 7 AM to 10 PM. In additon, you can get pre-approved by Realty Mogul so that you can submit your investments. Typically, in real estate you have to do this yourself, but you don't have to on Realty Mogul.

Features Unique to Crowdstreet

And why should you invest with Crowdstreet?

Crowdstreet:

Crowdstreet is the first ever investment crowdfunding platform that gives you access to real estate, direct investment, and private lending opportunities. Our equity crowdfunding platform gives you the chance to earn returns improving your home, building a passive income stream, and diversifying your portfolio. Download our crowdfunding platform to learn more.

Free Crowdstreet Membership gives you the chance to earn equity in listed real estate projects and private lending opportunities while also learning about the world of real estate investing.

As a Registered Crowdstreet Member, you will get full access to real estate investment opportunities including the ability to submit multiple investment proposals to multiple real estate investors.

Know Your Real Estate Expert, network with members, and learn from real estate investors at our exclusive real estate investment conferences.

Secured, Private, and Safe Investing Projects.

Membership is Free and no charge for withdrawals from your account.

Membership includes access to accredited investor information and instructions.

Crowdstreet has partnered with a SEC-registered broker-dealer, which enables Crowdstreet to offer investment opportunities to non-accredited investors.

You'll need to provide a backup bank account when you first apply for your Crowdstreet account.

Minimum Initial Investment

Annual Fees

The real estate crowdfunding fees are nothing compared to the fees you’d pay for investing in a traditional REIT.

Everything considered, you can expect an annual fee of about 1%, with Realty Mogul and Crowdstreet coming in around the 1% mark and Fundrise just at the 0.5% mark.

Standout Features

The internet offers a number of choices for real estate investment, including Fundrise. Realty Mogul offers a few more features than Crowdstreet, but all have the same basic investment options.

Realty Mogul

Realty Mogul offers a couple of unique investment features that the other platforms do not offer. It allows investors to find the right investment opportunities based on the individual’s goals, income, and risk tolerance, as opposed to investment opportunities that only the investor can find. Realty Mogul also offers a number of different share classes to choose from.

Realty Mogul makes it easy for investors to track where their money is going. It provides information about income, occupancy, and plenty of other details.

Fundrise

Fundrise is considered to be the grandfather of real estate investment. It offers the traditional investment choices, which include notes, ground leases, and equity. It provides plenty of information to help investors figure out what to do with these different investment choices, including information about risks, returns, and strategies to make the most of each investment opportunity.

Crowdstreet

Crowdstreet doesn’t have any investment classes available that Realty Mogul or Fundrise don’t have. They do, however, offer a few different investment options to help investors diversify their portfolios.

Fundrise

Vs. Realty Mogul vs. Crowdstreet

The three leading commercial crowdfunding platforms are Fundrise, Realty Mogul and Crowdstreet. If you are interested in investing in commercial real estate, or just want to find out more about these platforms, you are on the right page.

The first question is do you want to invest in real estate or not? If you are not interested in investing then you can start with the leading crowdfunding platforms like Kickstarter or GoFundMe. Here we will discuss the three leading platforms for investing in real estate.

What are crowdfunding sites?

A forex trader is someone who trades in currencies and investors use such platforms to raise money for different projects. For example, to build a project or to develop a new project.

If you are a first-time investor, you might want to start small. Plus, you have to get used to the risk. Then crowdfunding is the best option for you. These are tools who cater to both investors and developers.

Understanding these 3 leading platforms will help you decide which platform is the right one for you. You can go through their features, pros and cons and go with the one that is right for you.

Realty Mogul

When you hear the word crowdfunding, there is a good chance that you immediately think of Fundrise. Since it was one of the first sites of its kind, it generated a lot of buzz. It also brings up a lot of questions about real estate crowdfunding. What is it? How does it work? Is it a good option for you?

It’s true that Realty Mogul and Crowdstreet both focus on real estate crowdfunding. However, Realty Mogul and Crowdstreet are more carefully regulated than Fundrise. Neither of these sites has had any problems with security, which is an issue that is frequently brought up with Fundrise. Additionally, Realty Mogul and Crowdstreet offer a wider variety of real estate investment options than Fundrise.

It’s also worth noting that Fundrise has had philosophical issues with people who would like to invest in properties that are unpopular or economically challenged. Fundrise prefers to stick with popular, booming areas rather than into uncollateralized investments.

Crowdstreet

Pros:

{1}. Great project picker: crowdstreet has quickly become a great way to invest in commercial real estate. With its well thought of algorithm, they are able to find projects in the early stages of development, This helps you to invest in a property before it becomes a hot investment.
{2}. Low Minimum Investment: Crowdstreet has no limits on the minimum investment amount. You can easily start with a very low amount.
{3}. Consistent Earnings: Another great thing about crowdstreet is that it allows you to earn consistently. If you don’t have a lot of free cash to spend, this platform will help you achieve your real estate investing goals.
{4}. Great customer Service: Crowdstreet’s customer service is among the best in the business. They are more than happy to help you invest smartly.

Customer Service

To begin with I will compare Crowdstreet’s customer service to Realty Mogul and Fundrise. Both Realty Mogul and Fundsire have excellent customer service, and I will admit, that in the beginning I was not impressed with Crowdstreet’s customer service. That was probably because Crowdstreet had relatively new web site and I had a lot of questions about the financial risks.

I was pretty surprised to get a call, an hour after posting my question, from my account manager. This person was able to direct me to the correct answer on the web site and I finally felt that I was able to start investing. On another occasion I was able to contact the accounting department by email and they were able to answer my question about tax reporting procedures.

What’s interesting is that within months, Crowdstreet had caught up with Realty Mogul and Fundrise and actually surpassed them in customer service.

Crowdstreet has a more polished web site than Realty Mogul and Fundrise, but is missing some tools that both of them have. For example, neither Realty Mogul or Fundrise have a tool to download information on an investment property. On the other hand, neither of them has the real-time update feature that Crowdstreet does.

Security

The US Capital Pooled Investment Fund has high daily trading volume and low annual fees. Investors should pay attention to its high annual management fee and inconvenient broker-dealer.

The Fundrise platform is investment platform that allows accredited investors to invest in commercial real estate projects. Investors should consider the high fees and illiquidity of the Fundrise platform.

Realty Mogul is an online platform for real estate investment. The company has low annual fees and large cash management. Investors should consider its illiquidity and non-professional investment advice.

CrowdStreet is a platform for investing in direct real estate loans. Both individual investors and accredited investors can participate. Investors should be aware of high fees.

—Direct Investment 2015

The US Capital Pooled Investment Fund has high daily trading volume and low annual fees. Investors should pay attention to its high annual management fee and inconvenient broker-dealer.

The Forge Path Fund has a low expense ratio and high net yield. Investors should consider its limited liquidity, high brokerage commission, and high annual fees.

The InvestinPath Fund invests in seniors housing, healthcare, and workplace real estate. The fund has low fees, high net yield, and reliable monthly dividends. Investors should be aware of its limited liquidity.

Who Are They Best For?

In order to determine the best company, we need to know what you want to get out of it. Self storage properties can be ideal for investors with different investment goals, and more than one platform might be right for you. For example, some people prefer doing everything through the same interface, while others like having multiple options. So with a provider like Realty Mogul where you can't check your self storage units online, you might want to be sure that you will be checking in with your property often enough that it won't be a problem.

There are some key differences between Fundrise, Realty Mogul, and Crowdstreet.

Age

Realty Mogul and Crowdstreet have been around for a few years, while Fundrise launched in mid-2016. Since you will be committing a lot of time to managing your properties, you would want to stick with a platform that has a proven track record.

Service Fees

Crowdstreet and Realty Mogul offer the same service fee of 2%, while Fundrise offers a service fee of 1%. So if you are pretty confident with your investment ability, you can save some money with Fundrise.

Monthly Required Turnover

Which Is the Best?

There are three well-known Crowdfunding platforms in the real estate field. These are Realty Mogul, Fundrise, and Crowdstreet.

Of these three, some experts are of the opinion that Fundrise is the best for a number of important reasons. For instance, just like Realty Mogul, Fundrise gives you a chance to back your favorite property investments and share in the profits. However, Fundrise offers a number of advantages over Realty Mogul. It has an eclectic mix of properties, unlike Realty Mogul.

These properties are located in locations where population is rising. In fact, the Fundrise Financial Advisors have gone out of their way to make an effort to design a portfolio that people would want to invest in. This portfolio includes properties that are located in places like metropolitan areas that are seeing rapid population growth.

Another reason why Fundrise is considered better by some is that it also makes use of ETFs. These are Exchange Traded Funds that help to ebb the risk in investing. Realty Mogul does not make use of ETFs.

On the other hand, Fundrise is not the perfect solution. This is because of certain reasons. It limits its investors to a particular amount to be invested each month. This is unlike RealtyMogul, where the investors can invest as much as they want to.