Crowdfunded Real Estate – Is it a Good Deal?

Crowdfunded Real Estate

Did you catch the latest episode of Shark Tank (Jan. 30/2015)?

Did you notice the pitch for a crowdfunded real estate company? The Sharks shut him down and accused it of being a scam. But is it?

Crowd funding and the internet now make it very convenient for people with a small amount of money and knowledge to get their piece of the property pie.

However, let’s look at some facts about the real estate industry and see the opportunities crowd-funded real estate really presents.

The industry which surrounds the financing of property is stuck in its ways and doesn’t like to change unless its forced to. It’s the underlying structure (the underwriting, if you will) that’s the foundation from which all property deals are built.

So, how exactly does traditional real estate investing work?

Well, at it’s core, the real estate industry is segmented and very inefficient. Investors have very few ways in which to access private real estate or the money necessary to buy it.

Most real estate investing deals come through word of mouth. The “old boys network” if you will. Of course, there are some women in that network but absolutely everyone privy to those deals has a lot of money.

Unfortunately, most investors don’t have $50,000 to $100,000 to put into just one property. This would prevent diversification.

So, how does the crowdfunding model apply to a real estate deal?

Most companies that offer crowdfunded real estate deals will have a website set up for potential investors to browse details on properties available for investing. Once a potential investor decides to invest the minimum required amount is usually between $1000 and $10,000.

Is crowdfunding particularly good for real estate investing? If so, why?

One of the main things crowdfunding does is eliminate most of the barriers and problems generally involved with traditional real estate investing.

However, you are also exposed to greater risk and less transparency of the real estate deal. The small investor in particular needs to be cautious with crowd funded deals.

Real estate investing is a time consuming endeavor. It’s expensive and requires skill and knowledge of the local property market. Do your due diligence thoroughly. If you don’t get your questions answered… don’t invest.

So, unless you’re willing to drop $100,000 into a single property and then actively manage and operate it, most properties are not a viable investment possibility for most people.

However, most crowdfunding platforms offer access that’s not always possible with traditional deals. It also greatly reduces the time and money requirements needed to invest in larger, traditionally funded deals.

Is crowdfunding the future of real estate financing and investing?

The real estate industry has a reputation of being slow to adapt to new technology. This has contributed to the fragmented, cumbersome and inefficient nature of dealings within the industry. That trend is changing.

However, we’re now seeing real estate become more adept at integrating technology into its transaction process.

As a result, we’ll continue to see greater efficiency, more transparency and much greater access in the real estate and finance industries. Crowdfunding will play a big part in that.

Recently,there have been interesting amendments passed and discussed within the JOBS Act in regard to crowding funding and real estate investment in general.

There is a monumental change happening within the real estate industry right now. It’s goal is to not only protect consumers but make buying property more accessible as well.

Contact us and learn more now… Email:

Now Seeking Investors & Partners

Real Property Money Associates has an online outreach program where we seek investors and partners to join with in other states across the country.

If you are an experienced real estate investor we’re interested in connecting with you. Here is what you get from us:

We have relationships with our investment partners that have lasted over 25 years. Together, we have invested over $125,000,000 in small/medium size bridge loans on commercial, multifamily, mixed use and specialty use properties.

We have experienced underwriters. We use multiple criteria to determine a lendable situation. We never lend more that 60% of the as is value or more than 50% on the completed value of any property.

We always do our due diligence. We look at the overall indebtedness and credit worthiness of every borrower who must also have a valid exit strategy (usually within 12 months) for every deal.

If the above describes the type of RE partner you’re interested in then perhaps we should connect…

Call 1-888-370-0698





**Right now, Real Property Money Associates are looking for investors/partners far and away…

First: We’re looking for investors who want to buy local distressed and “under valued” properties in the greater NY area. Then take those properties and use a buy, renovate and rent/hold business plan.

Second: We want to aide investors around the nation looking for funding for their local projects. These projects can be buy and hold or fix and flip options. They can even be strictly funding or refinancing deal as well.

Our Simple Buy/Hold Strategy Explained:

#1 Find distressed properties earmarked for a 20% to 30% return.

#2 Put down 50% up front and borrow the other 50% at a rate of 10%-12% annually (approx. 1% per month during the renovation phase).

#3 We refinance within 9 months and make 20-30% on the initial equity. Then we pick up the spread on the borrowed funds at 9% and net an additional 11%-21% off the loan…

This makes our entire ROI 30-40%. This is very doable. We’ve done it before and with this strategy we can either hold the property or sell and still see big numbers on the back end.

If reading the above strategies and opportunities gets you excited to work with us then give us a call or at the very least leave your email. We’ll get back to you ASAP.

Call 1-888-370-0698