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How to Become a Real Estate Mogul or Millionaire

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How to Become a Real Estate Mogul

If you’re looking for a proven way to grow wealth and build your net worth, there’s no doubt that real estate provides plenty of opportunities. Countless millionaires and billionaires have built their fortunes primarily or partially through real estate.

Becoming a real estate millionaire or real estate mogul is possible with the right approach. Thankfully, there are more ways to invest in real estate today than ever before.

What Is a Real Estate Mogul?

A real estate mogul or real estate tycoon is an individual who has made a significant amount of wealth through investing in real estate. Real estate moguls typically own multiple income-generating properties, such as rental properties or commercial real estate.

Many real estate moguls started with just one investment property and then used the income from that property to purchase additional properties. Over time, they were able to build up a large portfolio of income-producing real estate.

For example, here are the top real estate moguls in the world, along with their net worth according to Forbes.

Of course, these are the most successful real estate investors in the world. Reaching billionaire status may not be in the cards for everyone, but becoming a real estate millionaire is a much more realistic and practical goal. And once you’ve reached that level, you’ll have the potential to grow your net worth much faster.

How to Become a Real Estate Mogul

The traditional path to real estate investing involves owning income-generating properties like rental homes, apartment complexes, and office buildings. These types of properties can generate a lot of income, but they also require a significant amount of time and effort to manage (or you need a property manager or staff to handle everything for you).

Additionally, these types of investments generally require a large amount of capital upfront, which makes it difficult for people who are starting from scratch. Of course, there are ways to buy real estate with little or none of your own cash, but this may involve taking on a lot of debt or risk.

Certainly, the traditional approach can work and has worked for many people. However, real estate crowdfunding allows you to overcome some of those common obstacles that prevent many people from getting started with real estate investing.

Become a Passive Real Estate Millionaire

Real estate crowdfunding allows you to invest in large-scale real estate projects without having to go through the hassle of traditional property ownership. You’ll have no responsibilities related to tenants or managing a property.

And best of all, you can get started with as little as $10. Instead of needing a large chunk of money for a down payment on a property, you can get started today with what you already have.

Some real estate crowdfunding platforms are open only to accredited investors, and others are open to everyone.

To qualify as an accredited investor, you must meet one of the following criteria:

  • Earned annual income of $200,000 for an individual (or $300,000 combined income if married) for the previous two calendar years, with a reasonable expectation for the same level of income in the current year.
  • Net worth exceeding $1,000,000 (individually or combined with a spouse), excluding your primary residence.

It’s important to understand whether you’re an accredited investor or not because this impacts which platforms and investments are accessible to you.

Now, let’s look at some of the leading platforms for real estate investing.

Fundrise

Fundrise
  • Summary: Invest in a diversified portfolio of income-generating properties.
  • Open to: Accredited and non-accredited investors.
  • Minimum investment: $10

Fundrise is possibly the most popular real estate crowdfunding platform. It’s extremely beginner-friendly since it’s open to all investors and there is a very low $10 minimum investment.

When you invest with Fundrise, you’ll own shares in a large portfolio of income-generating properties throughout the United States. This includes apartment buildings, condo complexes, industrial and commercial properties, and even single-family homes.

It’s a totally passive and hands-free investment. All you need to do is deposit money and Fundrise takes care of the rest. Dividends are paid quarterly and they can be automatically reinvested or deposited into your bank account.

To date, Fundrise has an excellent track record. Fundrise returns have varied over the years, but are generally in the 8-12% range. They’ve also managed to avoid the downturns that the stock market has experienced in recent years.

Fundrise investors have the opportunity to choose from several different strategies or investment types. If you’re starting with the minimum investment of $10, you’ll be investing in their Starter portfolio, which provides you with a diversified investment.

If you invest at least $5,000, you’ll be able to choose one of their core strategies: long-term growth, income, or balanced. These strategies help to customize your portfolio for your specific situation and your goals.

To learn more, please read our Fundrise review.


RealtyMogul

Realty Mogul
  • Summary: Invest in REITs or individual properties.
  • Open to: All options are open to accredited investors. Non-accredited investors can invest in REITs.
  • Minimum investment: $5,000

RealtyMogul is a platform that offers two different types of investments: REITs and individual properties.

Real Estate Investment Trusts (REITs) are a type of investment that allows you to pool your money with other investors to buy commercial real estate projects, such as office buildings and shopping centers. Investing in a REIT with RealyMogul is fairly similar to an investment with Fundrise in the sense that you’re investing in a portfolio of multiple properties rather than a single property.

Currently, there are two different REITs offered by RealtyMogul: income and growth. These REITs are available to all investors and the minimum investment for each is $5,000. The income REIT provides monthly distributions, so it’s an excellent option for anyone looking for a source of supplementary income.

If you’re an accredited investor, RealtyMogul also provides you with the opportunity to invest in individual properties. These investments have the potential for higher returns, but also come with more risk. The minimum investment varies from one project to the next, but they’re higher than the minimum of $5,000 for investing in either of the REITs.

Like Fundrise, RealtyMogul has an excellent track record to date. You can learn more in our article Fundrise vs. RealtyMogul.


CrowdStreet

CrowdStreet
  • Summary: Choose from diversified funds and individual properties, or allow CrowdStreet to create a portfolio tailored for you.
  • Open to: Accredited investors only.
  • Minimum investment: Varies, but generally $25,000

Unlike Fundrise and RealtyMogul, CrowdStreet currently only has options for accredited investors. However, it’s one of the most popular platforms for accredited investors and CrowdStreet has an impressive track record.

Since 2014, CrowdStreet has funded more than 650 deals through its marketplace and has produced a 19% IRR for investors (as of July 2022).

Through the CrowdStreet marketplace, you can invest in individual deals throughout the United States. These deals could include apartment buildings, townhouses, hotels, office buildings, and more. The details of each offering will vary, but CrowdStreet provides plenty of information, including a target IRR

In addition, CrowdStreet also offers REITs that allow you to invest in a portfolio of properties rather than a single property. The portfolio approach is ideal if you’re not comfortable selecting a project on your own or if you want to decrease the risk by spreading your investment across several properties.

But unlike RealtyMogul, CrowdStreet’s REITs are currently only open to accredited investors. It’s also important to note that these REITs are open only for short windows. Once all of the investor spots are taken, the funds are closed. As a result, a REIT may not always be available through CrowdStreet.

CrowdStreet also stands out by providing the option of a custom-tailored portfolio. The professionals at CrowdStreet will get to know you and your goals and then select the specific projects to create a portfolio that’s appropriate for you.


EquityMultiple

EquityMultiple
  • Summary: Invest in a wide variety of income-generating real estate through funds or individual properties.
  • Open to: Accredited investors only.
  • Minimum investment: $5,000

Like CrowdStreet, EquityMultiple is currently only for accredited investors. They also have an impressive track record of success (18.7% historical rate of return, as of July 2022), and they offer a few different ways to invest.

You can invest in individual properties with as little as $10,000, which is lower than the minimum for most platforms with similar offerings. EquityMultiple also provides an interesting mix of options. For example, the projects may include condos, office buildings, retail, storage facilities, industrial properties, and even campgrounds.

Aside from individual properties, EquityMultiple also offers funds that provide instant diversification and reduce the risk for investors. The minimum investment for these funds is $20,000.

The last option from EquityMultiple is intended to be an alternative to a low-interest savings account. These are short-term (3-9 months) diversified notes. While it doesn’t provide full liquidity like a savings account, it could be an option for money that you won’t need immediately. The minimum for this investment is $5,000.


Cadre

Cadre
  • Summary: Invest in individual properties or funds that are open for a limited time.
  • Open to: Accredited investors only
  • Minimum investment: $25,000

Cadre is another platform that caters only to accredited investors. They stand out thanks to an impressive 27.7% historical rate of return, as of June 2022. However, it’s important to note that Carde has completed significantly fewer deals than any of the other platforms listed above.

So far, Cadre has been able to produce outstanding returns for investors by taking a highly selective approach. Only the best opportunities make it onto the platform. As a result, there are fewer investment opportunities. But to date, the results have shown this approach is working.

Cadre invests in multi-family properties, office buildings, industrial properties, and hotels. Accredited investors who create a free account are able to view all of the relevant details for the current offerings.

In addition to individual properties, Cadre also offers diversified funds that provide ownership interest in multiple properties. However, these funds are generally only open for a limited time, so they may not always be available.

Another interesting option is the secondary market. While real estate crowdfunding is generally an illiquid investment, Cadre set up a secondary market that allows investors to sell their investments early if needed. This presents a unique opportunity to purchase investments below face value.


Groundfloor

Groundfloor
  • Summary: Short-term investments for house flips.
  • Open to: Accredited and non-accredited investors.
  • Minimum investment: $10

Groundfloor is a unique real estate crowdfunding platform that’s open to all investors. While most real estate investments will tie up your money for several years, Groundfloor focuses on short-term investments that typically last 6-12 months.

House flippers can get funding through Groundfloor to rehab or renovate a house, with the goal of reselling it for a profit. As a real estate investor, you can see the details of each project and select the ones you want to invest in.

The minimum investment is just $10, so anyone can get started. And if you have a few hundred or a few thousand dollars to invest, you can spread it across many different projects to get some diversification.

This is a very popular platform and there are always plenty of investment opportunities available. New ones are added daily.

The returns vary depending on the details of the project, but anywhere from 7% to 12% is common. Historically, investments through Groundfloor have averaged a return of more than 10%.


Arrived

Arrived
  • Summary: Buy shares of single-family rental homes.
  • Open to: Accredited and non-accredited investors.
  • Minimum investment: $100

If you’ve always wanted to own a rental property but didn’t want the hassles of being a landlord, Arrived could be the solution. This real estate crowdfunding platform allows investors to purchase shares of individual properties. Investors are paid quarterly based on the rental income, but investors have no responsibilities for managing or maintaining the property.

This is a relatively new platform and one of the downsides is that there are a limited number of deals available currently. However, Arrived presents an excellent investment opportunity for anyone to get started with real estate.

The properties will eventually be sold, and at the time, investors will also receive their share of proceeds from the sale. So just like traditional ownership of rental properties, you can make money through ongoing rental payments as well as appreciation.

Learn more in our Arrived Homes Review.


AcreTrader

AcreTrader
  • Summary: Invest in income-generating farmland.
  • Open to: Accredited investors only.
  • Minimum investment: Varies, but generally $10,000 to $20,000.

There are many different types of real estate and farmland is one option that’s often overlooked. Historically, farmland has produced excellent returns, but it’s not easy to get started. The land is often very expensive due to its large acreage, so it’s out of reach for many investors.

AcreTrader is a crowdfunding platform that makes farmland investing accessible to accredited investors. As an investor, you can buy a share in a particular property and generate cash flow through rental proceeds (distributions are paid annually).

Additionally, the property will be sold in the future, and investors also have a chance to make money through appreciation of the property value.

Farmland is an attractive investment because it’s typically more stable than the stock market. At the same time, investing in farmland provides the opportunity for solid returns.

The deals available at AcreTrader typically don’t last for very long. They tend to fill up quickly, so there’s not usually a large selection of deals available. However, if nothing is available at the moment, you can create an account so you’ll be notified of upcoming deals.


FarmTogether

FarmTogether
  • Summary: Invest in income-generating farmland.
  • Open to: Accredited investors only.
  • Minimum investment: Varies.

FarmTogether is similar to AcreTrader, but they also offer a farmland fund that takes a portfolio approach. Instead of investing in an individual farm, you’ll own a share in a portfolio that includes several farms.

The portfolio approach is excellent for reducing risk through diversification. FarmTogether has a target net IRR of 8-10% for their farmland fund, with 4-6% as a target net annual distribution. This is open only to accredited investors and the minimum investment is $100,000.


REITs

  • Summary: Easy way to invest in a portfolio of real estate.
  • Open to: Accredited and non-accredited investors.
  • Minimum investment: Varies.

Real Estate Investment Trusts (REITs) are possibly the easiest way to get started with real estate investing. REITs are companies that own or finance income-producing real estate. They’re required to pay out at least 90% of their taxable earnings as dividends to shareholders.

Public REITs are traded on stock exchanges, so they can be easily bought and sold like any other stock. This means they are 100% liquid, which is not the case with most types of real estate. And because REITs own a portfolio of properties, investors get instant diversification. This helps to reduce risk and makes REITs an excellent choice for those who are new to real estate investing.

There are many different types of REITs, so you can choose one that focuses on the type of property you’re interested in (e.g., office buildings, apartments, warehouses, etc.).

Exchange Traded Funds (ETFs) are a popular way to invest in REITs. You can buy a REIT ETF through Public.com, Webull, or Moomoo to get started easily and with a small amount of money. Public.com and Webull both offer fractional shares, so you don’t even need enough money to buy a full share.

See our list of the best real estate and REIT ETFs for some ideas.

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Final Thoughts on How to Become a Real Estate Mogul or Millionaire

Becoming a real estate mogul or millionaire is possible, but it takes time, effort, and discipline. While there’s no guarantee of success, the above strategies can help you get started.

If you’re looking for a passive way to invest in real estate, consider using a crowdfunding platform like Fundrise or RealtyMogul. These platforms allow you to overcome the most significant obstacles that prevent many people from getting started with real estate.

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