|

12 Fundrise Alternatives for Real Estate Investing

Vital Dollar may receive compensation from companies, products, and services covered on our site. For more details, please read about how we make money.

Fundrise Alternatives for Real Estate Investing

Investing in real estate is one of the most popular and most proven ways to build wealth. However, price is often a barrier to entry for new investors. Most people don’t have the means to buy rental houses or other types of income-generating properties like office buildings.

Thankfully, crowdfunding platforms like Fundrise make commercial real estate a realistic investment for just about anyone.

Fundrise is one of the leading crowdfunding real estate platforms and has an excellent reputation. But if for whatever reason Fundrise does not appeal to you, there are some great Fundrise alternatives.

Here we’ll explore some of the other platform options to help you make an informed investment decision.

Fundrise Overview

Fundrise

Fundrise has been operating since 2012 and is available to U.S citizens and permanent residents at least 18 years old. You can open individual accounts, joint accounts, and IRAs.

Your Fundrise deposits are placed into diversified investments called eREITs and eFunds. These are professionally managed portfolios offering access to investments in commercial properties, apartment buildings, single-family homes, and private equity funds.

However, what makes Fundrise stand apart from many other platforms is that there are different account tiers.

  • Starter: With just a $10 minimum investment, this is an attractive option for those with limited investment funds.
  • Basic: This is the minimum tier to invest in an IRA and you’ll need at least $1,000.
  • Core: This level has a $5,000 minimum, but provides access to different portfolio strategies; Balanced Investing, Long-Term Growth, and Supplemental Income.
  • Advanced: This tier has a $10,000 minimum investment and opens up “Plus Plans” which applies a portion of your portfolio to evolving sophisticated investment strategies.
  • Premium: There is a $100,000 minimum investment for this tier, and it offers access to certain private equity funds that have a higher risk, but tremendous growth potential.

In addition, Fundrise returns have been very attractive to date. While the stock market has gone up and down over the past few years, Fundrise has been able to avoid the downturns.

While we’re big fans of Fundrise as an alternative investment, no platform is right for everyone. If you’re looking into other options, you may want to consider the investment opportunities covered in this article.

For more details, see our Fundrise review.

Are You an Accredited Investor?

When researching real estate investing platforms (and other alternative investments), it’s important to know if you qualify as an accredited investor. Some platforms and investments are open only to accredited investors, while others like Fundrise are open to both accredited and non-accredited investors.

In the U.S., accredited investors need to meet at least one of the qualifying criteria:

  • Individual income of at least $200,000 per year for the past two years, or joint income with a spouse of $300,000+. There also needs to be a reasonable expectation that you will meet the same income level during the current year.
  • Individual or joint net worth of $1 million or more at the time of investment. However, your net worth cannot include the value of your primary residence.
  • Individuals who are a “knowledgeable employee” of a private fund.
  • Holders of certain certificates, credentials, or designations. For example, Series 7, Series 82, or Series 65 license holders.

However, it’s important to note that the burden of proving that you meet the accredited investor status does not directly fall on you. It’s actually the responsibility of the investment vehicle that you’re looking to invest in.

A fund or company would need to determine that you qualify. This typically involves asking you to complete a questionnaire, but you may need to provide supporting documentation such as credit reports, financial statements, and tax reports.

Fundrise Alternatives

Now, we’ll start to delve into Fundrise alternatives, but we’ll begin with platforms that are open to non-accredited investors.

1. RealtyMogul

Realty Mogul

Like Fundrise, RealtyMogul has been operating since 2012. Through the RealtyMogul platform, you can invest in various real estate projects throughout the country. This includes commercial deals that can run into millions of dollars and would be out of the reach of the average real estate investor without access to crowdfunding.

To date, RealtyMogul has facilitated investments in more than 350 properties with a value of over $2 billion, returning over $100 million to its investors.

While we’ve highlighted RealtyMogul as a non-accredited investor platform, they also have some investments that are only available to accredited investors. Non-accredited investors can invest in RealtyMogul’s REITs, which feature a portfolio of properties. Accredited investors have the option to invest in individual properties as well.

The main feature of RealtyMogul is that it offers pre-vetted investments. Less than 10% of the deals first displayed on RealtyMogul make it through to the funding stage. The platform has a comprehensive vetting process that involves individual backgrounds, sponsor history, and track records to create the highest possible chance of a positive return.

RealtyMogul is a straightforward platform to use, where you can analyze the provided research, including pictures and videos. You can also ask questions before making an investment.

Although the minimum investment isn’t as low as the basic Fundrise tiers, you can access RealtyMogul REITs from $5,000.

RealtyMogul is possibly the best Fundrise alternative in terms of offering something that’s very similar to Fundrise. Learn more in our Fundrise vs. RealtyMogul comparison.


2. DiversyFund

DiversyFund

DiversyFund specializes in apartment buildings with over 100 units. The platform’s REIT strategy is based on purchasing undervalued multi-family properties to generate rental income.

In many cases, the apartments need capital to make improvements and increase the rental potential. These improvements can also raise the value of the entire building.

The income generated is reinvested each month to finance improvements until the property can be sold for a healthy profit. After the sale is finalized, the capital appreciation and any accumulated dividends are distributed out to investors. You can then choose to cash out or maintain your DiversyFund relationship with future projects.

The stand-out features of this platform include that there are no management fees and a $500 minimum investment. You can set up an account in less than five minutes.

There’s also a help section on the DiversyFund website for potential and current investors. If you can’t find an answer to your query on the site, you can use the online chat, email support, or phone helpline.

Learn more in our Fundrise vs. DiversyFund comparison.


3. Streitwise

Streitwise has been operating since 2016 and manages REITs, mostly with office properties. The aim of the Streitwise founders was to facilitate changing lives through real estate investments, one dividend at a time. In fact, the co-founders have invested over $5 million of their own funds into the platform.

Like Fundrise, Streitwise is open to both accredited and non accredited investors. However, Streitwise has a minimum investment requirement of $5,000, which is significantly higher than Fundrise’s $10 minimum.

One stand out feature of Streitwise is its transparent fee structure. Many real estate crowdfunding platforms can be a little complicated to understand, but Streitwise simply has a 3% upfront fee. While this may seem high, you can feel reassured that there are no hidden fees that will come as an unexpected surprise once you’ve made an investment.


4. HappyNest

HappyNest

HappyNest is one of the newer real estate crowdfunding platforms, as it was only founded in 2017. The founder, Jesse Prince, established the platform with the idea of creating opportunities for everyday investors to make money with real estate. It began with a desire to help fellow military families, but it has expanded and is now open to anyone.

HappyNest promotes the fantastic potential of real estate investing, particularly that real estate tends to be less volatile compared to investing in the stock market. The platform also highlights that it could provide a passive income stream.

What makes HappyNest great is that you can get started with just $10 per month. This makes the platform highly accessible for almost everyone. You can simply build your investments, working at your own pace with no maximum caps.


5. Arrived

Arrived Homes

Arrived is relatively new, so it doesn’t have the track record of Fundrise. However, Arrived does allow you to invest in fractional shares for single-family rental homes, earning dividends according to the net income that accrues from each property.

Since Arrived only began acquiring properties in 2021 and anticipates holding periods of five to seven years, there have been no investments sold as yet. However, the platform does anticipate additional returns from appreciation when each property sells.

As an Arrived investor, you’ll be purchasing shares of a Series LLC or Series that owns underlying properties. Every individual home series is qualified for taxation as a separate REIT. This takes place in the taxable year ending after the initial offer of interest for series completion.

The minimum investment for Arrived is $100, so each property has multiple investors. You can earn fractional interest on the income and capital appreciation according to your percentage stake in the property. Like Streitwise, Arrived has a simple fee structure of 1% per year, making it easy to calculate the potential fees for your investment.

Learn more in our Fundrise vs. Arrived Homes comparison.


6. Roofstock

Roofstock

Roofstock is a real estate crowdfunding platform, acting as a marketplace to buy and sell single-family rental (SFR) properties. You can invest in SFRs in your home city or other markets to generate a rental income or build a diversified portfolio.

There’s a wide selection of homes, but the main advantage of Roofstock is that the homes already have tenants, creating an immediate income stream. All properties have also been certified by the Roofstock platform to ensure it meets minimum standards. Roofstock will even refuse a property listing if the property does not comply with the requirements or the seller is asking too high a price.

Roofstock does have a marketplace fee of 0.5% or $500 if your property offer is accepted. You will also need to cover closing costs, property management, and other related costs.

If you’re an accredited investor, you can also access Roofstock One. This has a $5,000 minimum investment, but it allows you to avoid the process of directly buying a property and finding a manager for it.

When you invest in Roofstock One, you’ll own a share of a portfolio of rental properties that will be managed for you. It offers hands-free real estate investing.


7. Groundfloor

Groundfloor

Groundfloor generates investments for property purchases, renovations, and flip the properties to earn a profit. This strategy does involve a large number of smaller capital investments.

Groundfloor has a very low $10 minimum investment (like Fundrise) and there are no management fees for maintaining your investment. The average returns are 10% or more, but results will vary since you’re investing in individual properties.

Unlike many real estate crowdfunding platforms where your money can be tied up for five or more years, Groundfloor focuses on short-term loans that are typically 6-12 months long.


8. REITs

If you’re not an accredited investor and the above platforms do not appeal to you, there are still some other ways to invest in real estate. There are some excellent REITs (real estate investment trusts) available that can allow you to include income-generating property in your portfolio.

The best REIT ETFs allow investors to overcome some of the obstacles preventing many people from getting into traditional real estate investing.

If you have concerns about tying your money up for years, as you would need to with most of the above platforms, a REIT ETF could provide a great solution. ETFs are highly liquid, allowing you to buy and sell them at any time, just as you would with a stock share or mutual fund.

ETFs are also easy to access. You can buy them through any brokerage. Public.com and Webull both offer commission-free trades of ETFs.

Top Pick
Get Free Stock from Public.com Get Free Stock from Public.com

Public.com offers fractional shares so anyone can start investing. You'll love the social aspect that makes it possible to connect with other investors. Get a free stock slice worth up to $300 when you open an account through our link.

Features:
  • Commission-free trades of stocks and ETFs
  • Buy and sell 27 different cryptocurrencies
  • Fractional shares
  • Easy to use and beginner-friendly
  • Connect with a supportive community of investors
  • "Themes" help you to find investments that interest you
Offer valid for U.S. residents 18+ and subject to account approval. This is not a recommendation. You can lose money with any investment. Open To The Public Investing is a member of FINRA & SIPC. Regulatory and firm fees apply. New customers receive free stock with value $3-300; 0.3% receive the max value. Cryptocurrency trading provided by Apex Crypto LLC (NMLS ID 1828849). Apex Crypto is licensed to engage in virtual currency business activity by the New York State Department of Financial Services. See Public.com/disclosures/

Although you can directly invest in individual REITs, buying ETFs allow you to hold ownership interests in different REITs. This provides broader exposure and better diversification.

In many cases, you can get started with as small a sum as $1, which also allows you to overcome the price barrier to entry.

Fundrise Alternatives for Accredited Investors

Now, we’ll look at the Fundrise alternatives if you’re an accredited investor.

1. CrowdStreet

CrowdStreet

Crowdstreet has been around since 2014, making it one of the most well-established real estate crowdfunding platforms. With Crowdstreet, you can have the reassurance that the platform thoroughly vets all the developers and performs a number of background and reference checks to increase the chances of a profitable return for its investors.

You can browse the platform and select individual properties, but Crowdstreet also allows you to directly interact with the specific project sponsors. This provides a fantastic tool if you have any questions or concerns before you invest in a particular property or real estate project.

The minimum investment on Crowdstreet is project specific. Some projects require a higher minimum investment, but the lowest minimum is typically $25,000. This makes the platform better suited to those who are more risk tolerant and prepared to tie up a larger amount of capital in the medium to long term.

In addition to investments in individual properties, CrowdStreet also offers REIT funds, but they are typically only open to investors for a limited time.


2. Cadre

Cadre

Cadre has also been operating since 2014, but it has a focus on quality rather than quantity of properties. Cadre’s overall aim is to make commercial real estate accessible for those who would otherwise struggle to invest in this niche.

While many other real estate investing platforms hold far more properties, Cadre takes a very selective approach with the aim of producing better returns. It focuses on properties in high-growth markets, using extensive manual due diligence to identify the best opportunities.

Cadre invests in industrial properties, hotels, offices, and multi-family apartment buildings. However, Cadre doesn’t simply rely on investor capital, as it also invests its own funds into the properties.

Due to the extensive due diligence and historic rates of return of 18.2% per year, Cadre provides a solid financial investment option for those seeking outsized returns.

There are two fees that apply to every Cadre deal. Firstly, there is a 1% to 3% upfront fee of the gross investment per transaction. So, with a minimum investment of $25,000, you would need to pay a $250 to $750 fee straightaway.

The other fee is a recurring annual management fee. This is a 1.5% to 2% fee of the net asset value. Cadre also has a share of sponsor’s “promote”. This is a percentage of sponsor profits when a deal has been completed, so the property has been sold, typically above the minimum profit threshold.

On the surface, this may seem as if Cadre wants a larger piece of the potential profits, but it actually incentivizes completed deals that outperform targets. Rather than just relying on funding transactions, Cadre makes more money if the investment deals are profitable.


3. EquityMultiple

Equity Multiple

EquityMultiple allows accredited investors access to professionally managed private real estate deals. You can use the online platform to access investment opportunities in different markets.

The minimum investment varies by project, but there’s a base minimum of $5,000. However, it’s more common to see a minimum investment of $10,000.

Additional shares are typically offered in $5,000 increments above the minimum. You can make investments via a self-directed IRA or use one of the EquityMultiple preferred IRA partners. These partners usually have a minimum investment of $10,000.

EquitMultiple has a number of different investment options including senior debt, preferred equity, mezzanine debt, common equity, opportunity zones, funds, and 1031 exchanges. There may also be evergreen funds and yield-focused short-term notes. EquityMultiple claims to have returned $39.2 million to its investors, so it stands out as a well-regarded and established commercial real estate investment platform.


4. AcreTrader

Acre Trader

AcreTrader is quite a unique real estate crowdfunding platform, as instead of commercial or residential real estate, you can buy shares in farmland. This is an interesting way to diversify your investment portfolio.

AcreTrader has been operating since 2018, but it is already BBB accredited with an A- rating. Carter Malloy, the CEO and founder of AcreTrader grew up within a farming family, yet he spent most of his career in the financial services industry. These backgrounds combined to inspire AcreTrader.

There are two ways that investors can make money with AcreTrader; land appreciation and dividends from annual rent payments. Each share represents 1/10 of an acre and costs $5,000 to $10,000. The holding periods vary from five to 20 years. However, there are some properties that have a minimum investment of an acre plus, which means that you would need to invest at least $50,000.


Frequently Asked Questions

Who competes with Fundrise?

Fundrise’s most direct competitors for real estate investing include RealtyMogul, DiversyFund, Streitwise, and Happy Nest. There are plenty of other real estate platforms, but these competitors all allow non-accredited investors the ability to own a share of a portfolio of income-generating properties.

Is Fundrise passive income?

Yes, Fundrise offers hands-free real estate investing and cash flow. Investors have no responsibility related to managing properties. The dividend income you receive as a Fundrise investor is passive income.

Is Fundrise better than a REIT?

REITs are among the most popular options for passive real estate investing. Publicly traded REITs offer 100% liquidity, which is an advantage for those who may need the money at some time in the near future. However, Fundrise has an impressive track record, so investors who won’t need the money in the next five years may be able to get better returns with Fundrise.

How stable is Fundrise?

While the past isn’t a guarantee of future results, Fundrise has been impressively stable to date. While the stock market has experienced some significant declines, including March of 2020, Fundrise has not experienced any negative quarters as of yet.

How long do I have to keep money in Fundrise?

Investments with Fundrise are intended to be held for at least five years. The company does offer liquidity options (although liquidity is not guaranteed), but you may face penalties for money that is withdrawn in less than five years.

Final Thoughts on Fundrise Alternatives

Fundrise is an excellent platform, providing access to some great real estate investment deals. However, if for some reason, Fundrise does not appeal to you, there are some superb alternatives.

Whether you’re an accredited investor or not, you will need to consider your minimum investment, the type of property you would like to invest in, and whether you want a regular income or wait for profits from completed projects.

This will help you to determine the right real estate investing platform or product that meets your risk tolerance, investment preferences, and investment goals.

Just be sure to check the full terms and conditions to ensure that you are comfortable with the fee structure and investment period before you make an investment.



Disclosure: Information presented on Vital Dollar and through related email marketing is intended for informational purposes only and is not meant to be taken as financial advice. Please see our Disclosure for further information.