Crowdfunding REI

[Mohammad Sheatt]

Has anyone here invested with some of the crowdfunding sites like Realtyshares, Fundraise, and Realtymogul? What is your experience so far

[Ian Ippolito]

Yes, mine have but that is  not the case for every crowdfunding investor. Several different investments have experienced defaults, or not paid back on time, or only broke even and not given the promised return. I've written about what investors have reported on each review of each site. It's important to do your homework on the platform. And then you have to do your homework again on each individual investment. 

Right now, I would estimate about 95% of the investments  out there are doing fine. However, if we get into a recession and the real estate cycle experiences a downturn, I will expect that number to decrease significantly. Personally, I'm only investing in very short investments (one year) and very long investments (more than 5 years) that are riding long-term macro trends that will last a decade or more. In my opinion, the middle term investments in the 2 to 5 year range are too risky, due to the risk of a downturn.

I personally have great reservations about one of the sites you mentioned: Fundrise, due to the enormous changes that have been going on over the past several months, which I have written about in detail. (No more individual investments, forcing investors into a structure with gigantic fees, and huge investor dilution, etc.) They used to be ranked number 2 but are going to be downgraded when I get a chance to upgrade the ratings. In my opinion, the other 2 sites you mentioned are solid choices. And before narrowing your choices down to one or 2 sites, I would recommend 1st looking at the entire universe and finding out which ones might be appropriate for your investment goals.