Money Analysed

Diversify Your Portfolio: Investing in RealtyMogul and Other Real Estate Crowdfunding Platforms

to RealtyMogul:

Real estate investing has always been considered an excellent way to build wealth and diversify ones portfolio. However, investing in real estate can also be complex and expensive, making it difficult for the average person to participate.

This is where RealtyMogul comes in. RealtyMogul is a leading real estate crowdfunding platform that uses technology to provide investors with simple and affordable access to real estate investments.

In this article, we will take a closer look at how RealtyMogul works, its REITs, and why it could be a valuable option for investors. How does RealtyMogul work?

RealtyMogul uses crowdfunding to make investing in real estate more accessible. Traditionally, investing in real estate meant purchasing illiquid assets like properties, which requires a significant amount of capital and can be challenging to sell later.

RealtyMogul, on the other hand, allows investors to pool their capital together and invest in a variety of real estate projects.

One of the primary ways RealtyMogul allows investors to invest in real estate is through their REITs or real estate investment trusts.

REITs are companies that own and manage income-generating real estate properties. They offer investors a way to own a diversified portfolio of real estate investments.

RealtyMogul’s REITs:

RealtyMogul offers two REITs for investors: The Income REIT and The Apartment Growth REIT. The Income REIT:

The Income REIT is designed to give investors exposure to a diversified portfolio of income-generating real estate assets.

This REIT invests in a mix of commercial properties, including office spaces, retail centers, and industrial units. The Income REITs focus is on generating consistent income for investors, and it achieves this by investing in properties that have long-term leases with established tenants.

Investing in The Income REIT provides investors with monthly distributions or dividends. The dividend rate is typically around 5%, which is higher than most traditional investment vehicles, such as bonds.

The Income REIT also has a low entry point, with the initial investment being just $1,000. The Apartment Growth REIT:

The Apartment Growth REIT is a REIT that focuses on multifamily properties, specifically apartments.

Its primary goal is to achieve capital appreciation by investing in properties in high-growth markets. Investors in The Apartment Growth REIT can potentially benefit from the growth of urban centers, increases in population, and the demand for rental housing.

The Apartment Growth REIT aims to generate quarterly distributions for its investors. It is worth noting that as a growth-oriented REIT, future distributions are not guaranteed, and any investment in The Apartment Growth REIT involves risks.

Is RealtyMogul right for you? RealtyMogul is an alternative investment platform that may be suitable for investors who have a long-term investment horizon and are looking to diversify their portfolio.

While it offers access to a variety of real estate projects, it is not an investment vehicle that is suitable for everyone. One important consideration is that these investments are subject to a lock-up period, meaning that investors will not be able to withdraw their funds until the end of the investment period.

This makes it more challenging to access your funds in case of an emergency. Another crucial factor to consider is that these investments are not insured and therefore involve risks that investors must be aware of.

Conclusion:

RealtyMogul’s innovative technology and accessible investment options have made real estate investing more straightforward and more affordable. By investing in their REITs or through one of their many other investment opportunities, investors can gain exposure to real estate markets without having to take on the additional risks associated with investing in physical properties.

It is worth noting that any decision to invest in real estate should be evaluated based on an investors goals, risk tolerance, and personal circumstances. Real estate investing has long been considered one of the most effective ways to build long-term wealth.

However, traditional real estate investing can be costly and prohibitive to the average investor. This is where real estate crowdfunding platforms have gained popularity.

These platforms allow investors to pool their resources and invest in real estate opportunities that they otherwise would not have access to. RealtyMogul is one such platform that brings together accredited investors and provides them with access to a wide selection of investment properties.

How it works:

RealtyMogul works by bringing together a network of accredited investors and connecting them to vetted real estate investment opportunities. Accredited investors are high-net-worth individuals or institutions that are deemed to have sufficient financial knowledge and can meet the eligibility requirements as defined by the Securities and Exchange Commission (SEC).

The process of investing in a real estate project on RealtyMogul typically involves several steps. First, the platform’s team of experts conducts thorough due diligence on the investment opportunity.

It involves evaluating the potential returns, assessing the risks involved, and making sure that the project aligns with the platform’s investment criteria.

Once the due diligence is complete, the investments are structured as special-purpose entities.

The accredited investors then have the opportunity to invest in these entities for a set period, usually with the potential to receive periodic distributions.

Fees and minimum investment:

Like all investment platforms, RealtyMogul charges administrative and legal fees for its services.

Investors are required to pay an annual fee of about 1% of the total investment amount. Additionally, depending on the nature of the investment opportunity, there may be other fees associated with the transaction.

RealtyMogul’s minimum investment amount typically ranges from $25,000 to $50,000, which can be a barrier to entry for some investors. However, it is important to keep in mind that investing in real estate has traditionally been associated with high costs and larger investment amounts, making RealtyMogul a cheaper and more accessible avenue for ordinary investors.

What is a 1031 exchange? A 1031 exchange, also known as a like-kind exchange, is a tax-deferment strategy that allows real estate investors to defer capital gains taxes when selling a property.

The process of a 1031 exchange allows for the sale of one property and the purchase of another “like-kind” property, without paying immediate capital gains taxes.

RealtyMogul’s 1031 exchange offerings:

RealtyMogul offers a wide range of 1031 exchange offerings that are available to accredited investors.

The company has offerings in the $25,000 to $50 million range, which provides investors with the ability to diversify across multiple investment opportunities. One of the significant benefits of investing in RealtyMogul’s 1031 exchange offerings is that investors can receive cash flow from the acquired property while deferring taxes on the gains made from selling their original property.

As such, RealtyMogul’s 1031 exchange offerings provide a way for investors to accumulate wealth and defer taxes on real estate transactions. Conclusion:

Real estate crowdfunding platforms like RealtyMogul offer investors with an avenue to participate in real estate investing at a much lower cost than traditional real estate investments.

By investing in its various offerings, investors can gain access to a diverse selection of investment opportunities previously only available to institutional investors. It is important for investors to carefully consider their investment goals, risk appetite, and any other relevant factors before investing.

In the world of real estate investing, RealtyMogul stands out as one of the most innovative and accessible platforms. It has made investing in real estate more straightforward and cost-effective for ordinary investors.

However, like all investment platforms, RealtyMogul has its pros and cons that investors must be aware of before deciding to invest. This article will take a closer look at the advantages and disadvantages of investing in RealtyMogul, as well as the account requirements and opening process.

Pros:

Investing in specific properties – One of the most significant advantages of investing in RealtyMogul is that investors can choose to invest in specific properties. Unlike traditional REITs, which often have a diverse portfolio of properties across different geographies and sectors, RealtyMogul allows investors to invest in properties according to their specific preferences and investment objectives.

Due diligence – RealtyMogul’s thorough due diligence process is a significant advantage for investors. Before offering any investment opportunities, the platform’s team of experts reviews and evaluates every deal in detail.

This ensures that only the best investment opportunities are offered to investors. REITs for non-accredited investors – Another significant advantage of RealtyMogul is that the platform offers REITs that are available to non-accredited investors.

This means that investors who do not meet the SEC’s requirements for accredited investors can still participate in real estate investing through RealtyMogul’s funds. Cons:

Accredited investor requirement – While non-accredited investors can invest in RealtyMogul’s REITs, most of the platform’s offerings are only available to accredited investors.

This requirement can be a significant drawback for investors who do not meet the SEC’s requirements. High minimum investments – The minimum investment amounts for RealtyMogul’s offerings are higher than for other investment platforms.

For example, the minimum investment amount for some of its investment opportunities is $50,000. This can limit the number of investors who can participate, particularly those who may want to diversify their portfolio across multiple investment opportunities.

Illiquid assets – RealtyMogul’s investments are considered illiquid assets; that is, they cannot be easily sold or traded like traditional stocks or bonds. This means that investors need to be prepared to hold their investments for the duration of the project, which can be several years.

Account Requirements and Opening Process:

RealtyMogul allows both accredited and non-accredited investors to open an account and invest in its various offerings. Non-accredited investors can open a free account and gain access to the platform’s REITs and other investment opportunities.

To open an account, investors need to provide their personal information and complete the account verification process, which involves providing proof of identity and residency. Accredited investors, on the other hand, can access the platform’s broader range of investment opportunities.

Accredited investors are required to meet certain SEC qualification criteria, including a minimum income, net worth, or professional experience. The opening process for accredited investors is similar to that of non-accredited investors, with the additional requirement of providing documentation that verifies their accredited status.

Once an account has been opened, RealtyMogul provides investors with the ability to set investment preferences, such as risk tolerance, investment amount, and expected return. Based on these preferences, the platform will recommend suitable investment opportunities to the investor.

Conclusion:

Real estate crowdfunding platforms like RealtyMogul have disrupted the traditional real estate investing space by providing investors with access to real estate investment opportunities that were previously out of reach. By being aware of its advantages and disadvantages and meeting its account requirements, investors can benefit from investing in RealtyMogul’s diverse selection of real estate opportunities.

Real estate investing has long been considered a reliable way to build wealth and diversify a portfolio. With the advent of real estate crowdfunding platforms like RealtyMogul, investing in real estate has become more accessible and affordable for the average investor.

In this article, we will discuss the potential returns of investing in RealtyMogul and also look at other real estate crowdfunding platforms. Potential Returns with RealtyMogul:

Historical performance of REITs – RealtyMogul’s REITs have performed well historically.

The Income REIT, for example, has generated an annualized distribution yield of around 6% and has seen an increase in net asset value (NAV) since inception. It is important to note that past performance is not indicative of future returns, and any investment carries risks.

Variable return on specific properties – Returns on individual properties can vary widely based on several factors, such as location, management, and changes in real estate values. Some real estate investments may generate higher returns than others, while others may underperform.

As such, investors must carefully select the real estate investments that best match their investment objectives and risk tolerance. Other Investing Platforms:

Fundrise – Fundrise is another real estate crowdfunding platform that provides investors with access to a portfolio of proprietary eREITs. The platform offers a diverse selection of investment opportunities, including both debt and equity investments.

Fundrise’s eREITs have a low minimum investment amount of $500, making it more accessible to non-accredited investors. EquityMultiple – EquityMultiple is a real estate crowdfunding platform that provides investors with access to a diverse selection of commercial properties.

Accredited investors can participate in EquityMultiple’s fund offerings, which comprise diversified portfolios of commercial properties. EquityMultiple aims to provide investors with access to institutional-grade real estate investments with low minimum investments.

Conclusion:

Investing in real estate through crowdfunding platforms offers investors access to a diverse range of investment opportunities that were previously only available to high-net-worth individuals and institutional investors. As with any investment, it is essential to do due diligence and carefully evaluate the risks and potential returns before investing.

By doing so, investors stand to gain access to potentially high-return investments in the real estate market. Real estate crowdfunding platforms, such as RealtyMogul, have made investing in real estate more accessible and affordable for the average person.

These platforms offer investors access to a diversified selection of investment opportunities, including REITs and individual property investments. However, investors need to be aware of the risks and potential returns before investing.

It is crucial to carefully evaluate investment opportunities and do proper due diligence to make informed decisions. Other crowdfunding platforms, such as Fundrise and EquityMultiple, offer similar investment opportunities to investors.

Ultimately, investing in real estate through crowdfunding platforms can provide investors with high-return investments and diversification in their investment portfolios.

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