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Thanks to the advent of crowdfunding investment platforms, investors in all tax brackets now have the opportunity to incorporate big-ticket investments—things like art, equities, and even real estate—into their portfolios. This approach to investing has only grown in popularity in recent years. By pooling financial resources with other investors, crowdfunding has given more people the opportunity to benefit from investing in these assets without having to foot the whole bill independently.
If you’re looking to learn more about real estate crowdfunding, you’ve come to the right place. In this RealtyMogul review, we’ll cover everything you need to know about this specific platform to determine if it’s the one for you—and if not, what you’ll want to look for in an alternative.
What is RealtyMogul?
Real estate investment is a space that has historically been reserved for those with highly specialized knowledge, powerful industry connections, and perhaps most importantly, significant capital. RealtyMogul is on a mission to change that, lowering the investment threshold by allowing investors to crowdsource funds and bringing a more diverse group of investors into the fold. RealtyMogul connects both accredited and non-accredited investors with vetted commercial real estate opportunities and offers multiple avenues for new investors to engage in this asset.
Through RealtyMogul, accredited investors have access to private placement investments, while non-accredited and accredited investors alike can access two types of non-traded, public Real Estate Investment Trusts. Since it was founded in 2012, the platform has grown a membership base of over 250,000 and has been used to invest over $950 million into real estate, financing over 350 properties with values exceeding $4.7 billion.
RealtyMogul thoroughly investigates each potential investment property in order to ensure the company’s background and reputation are up to their standards, and that the investment meets all the requirements of their platform. While the Better Business Bureau’s RealtyMogul review resulted in an A+ rating—the highest rating a business can receive—they aren’t BBB accredited. As with any investment, it’s important to weigh the risks and rewards of engagement before making a decision.
What is the key focus of RealtyMogul?
While the platform offers a variety of investment opportunities to a diverse set of investors with varying degrees of experience, the key focus of RealtyMogul is to make complicated and often unattainable investment opportunities simple and accessible to all.
By carefully selecting listings capable of generating passive income for non-accredited investors, and highly sought-after offerings in apartment buildings, office buildings, and storage facilities for accredited investors, you’re likely to find an opportunity that interests you on RealtyMogul.
RealtyMogul features
In order to appropriately review RealtyMogul and determine whether or not it’s the investment platform for you, you first need to take a close look at its features. These will help you determine the things that are most important to you in an investment platform and where RealtyMogul falls in relation. Here are the top RealtyMogul features:
- Accessibility: Since both accredited and non-accredited users are able to invest with RealtyMogul, the top boasted feature is its accessibility for those new to real estate. Rather than needing a net worth of over a million dollars and an annual income that exceeds $200,000 independently ($300,000, if married), investors on RealtyMogul can buy in for as little as $5,000.
- Investment opportunities: This platform offers a variety of opportunities for investors. Non-accredited investors can choose from public, non-traded REITs, Income REITs, or Apartment Growth REITs—which are also available for individual retirement account holders—while accredited investors are also able to peruse highly desirable equity offerings.
- Return potential and liquidity: While no investment is guaranteed to turn a profit, investing in real estate has a good chance of bringing in some serious cash flow. Private placements yield up to 10% in annual returns, RealtyMogul Income REITs yield up to 8% annually, and RealtyMogul Apartment Growth REITs pay approximately 4.5% annually. If you want out of an investment early, the platform also offers a buyback program.
Drawbacks to consider
Although the highlights are great, every investment platform has its drawbacks as well. Here are some things to carefully consider when reviewing RealtyMogul:
- Steep investment minimums: While this platform is accessible to a larger variety of investors than many others in the real estate investment space, it does still come with relatively high investment minimums. Every investment minimum is different, and you’ll find it specified in its prospectus documents. The lowest minimum rings in at a whopping $5,000.
- Complicated fee structure: No investment platform is without fees, but the ones at RealtyMogul are somewhat complicated. Each type of investment has established fees, and then every individual investment within that category comes with its own specific fees. While not astronomical, investors must be sure to read the fine print in order to understand exactly what they’ll be required to pay each year—and other platforms have lower fees.
The general fee structure breaks down like this:
- Private placement fees vary by investments, as they are established by the sponsor.
- RealtyMogul Income REITs have a fee of 1% annual equity value
- RealtyMogul Apartment Growth REITs have a fee of 1.25% annual equity value
Reasons to try RealtyMogul
So, with these pros and cons all laid out and weighed, who exactly is the right investor for RealtyMogul? First and foremost, this platform is great for nonaccredited investors looking to break into the real estate market who are interested in public, non-traded REITs. Alternately, accredited investors who want to capitalize on the market by investing in thoroughly vetted individual properties are also great contenders for RealtyMogul.
Bottom line
The real estate market has the potential to strengthen any investment portfolio. Whether you’re just trying to find your footing and get started in the asset, or need some expert help in order to find the more desirable deals with which to strengthen your portfolio, RealtyMogul has the potential to get you where you want to be.
If you’re ready to get started or want more than this RealtyMogul review provided before you make your decision, visit their website to learn more about the platform.