I'm curious if anyone has recent experience with investing via RE crowdfunding platforms. Good, bad, ugly stories? Would love to hear about what you appreciated in the investing process and what you wish would be better. Cheers!
@Jonny R. - There are countless threads on BP - Take a look here: https://www.biggerpockets.com/forums/520-crowdfunding-real-estate/topics/258773-share-your-crowdfunding-investment-results---the-good-and-the-bad?page=1
Thanks Saul! I saw that one and found it helpful, but I noticed that the bulk of the comments were at year old. I didn't know if there were more recent experiences with a variety of platforms. Thank you for the link!
@Jonny R. I'd recommend checking out 2 sites which have been helpful to me. CrowdDD and therealestatecrowdfundingreview. Both are a wealth of knowledge and both are run by members of Bigger Pockets.
@Greg C. - Thanks Greg - I appreciate the recommendations!
@Jonny R. 's recommendations on both sites. Excellent resources.
Thank you @Andrew Savikas !
I researched for a couple of weeks before getting into PeerStreet.com.
I like PeerStreet and currently have four active loans with them, 7% APR (21% LTV) up to 10.5% APR (61% LTV). This week I would say there have been around 30 new loans available to investors. One of the loans yesterday was for 11.75%. If you have any other questions let me know. If you would like an extra 1% yield bump on your first investment feel free to use this link: http://www.peerstreet.com/join?ref=hadmf6
Thanks @David P. ! Will check it out.
I think we are seeing signs of things that didn't quite work out as planned esp on the debt side. Keep in mind that most equity investments are longer term in nature so it will be a little while before those results are really in. Also, market is still going up and up so its really hard to judge results except that trouble is generally just really bad underwriting right now.
I would say focus on the platform's underwriting process and make sure you are very comfortable that they have a good process and have your best interest at heart vs. volume. Certainly, read the agreements so you know what will happen in the case of default (or with equity in the case of an issue). If you have trouble reading these get someone to explain it to you because these clauses will be the difference between a bad experience and a nightmare. I also would prefer platforms that let you do a lot of diligence (or have done it and provide it) on the property itself. Platforms that want you to fund in 20 minutes or really don't have much detail on the property itself are simply asking for too much trust in my opinion.
On the equity side there a lot of factors but just from a platform perspective, I would make sure I understood how they are getting paid and who else is getting paid. Many platforms are taking significant fees and/or have other fees. I prefer platforms that operate more on a SAAS/marketplace model and are only taking a small fee per listing typically not tied to returns or capital raised.
Lastly, I would note that platforms are really just sourcing deals for you. There is no magic. Yes its easier but I have found going direct and getting to know the sponsor to also be a very good option esp for debt. Course you do sacrifice diversification so that is a consideration.
Thanks @David P. For the referral code. Just used it. I will let you know when I invest.
I'm on realtyshares and currently have 2 debt deals and one equity deal with them. So far so good as I haven't had any issues with my deals once they get going. I've been using them for about a year. If you have any questions about them I'll try to answer as best I can. If you sign up and use this code http://mbsy.co/gQm3b
You get $100 Amazon gift card for free and so do I. I tried it with my wife and it does work and you get the e gift card pretty fast too. Pretty cool