What is Crowdfunding?
If you are tired of low returns on certificates of deposit, savings savings plan, and other equity investments, check out Crowdfunding for double-digit returns. Crowdfunding is gaining popularity as an investment strategy for many investors. It is a unique process to raise capital through family and friends, potential clients, and individual investors looking for different investment venues. To promote Crowdfunding, advertising is a focused approach that uses social networks and forums of real estate investors and associated networks.
Which platform is right for me?
My preference is crowdfunding with real estate investments which I will discuss here. There are many different strategies and models of crowdfunding platforms, so you need to make sure that the platform you select is right for you. Ask the question: Am I comfortable with the amount I will invest? Do we share the same values? Do you agree with your investment strategies, such as selling houses or buying and holding for long-term passive income? The amount required to invest will vary with each location, so shop around until you find a suitable one for your investment portfolio.
Do your homework
Do your homework before investing. Historical performance is a good indicator of future performance. Meet the management team and see what they are up to on social media. How transparent they are and how willing they are to talk to you and answer your questions, including difficult ones. Those who are more willing to share beliefs, management, and goals tend to do better for themselves and their clients in the long run. Also reach out to other investors to get their opinion and endorsement.
Do the math
I have seen advertisements for many attractive returns to find that they were more attractive rates for you to call. Do your homework to see if the numbers are realistic. Ask how many details are provided about the business. How can I access my investment and profitability after I have committed? How and when are investment returns distributed? What kind of reports (personal and legal) are provided to the investor? Make sure you are comfortable with the management team and the security of your investment before taking the first step.
Crowdfunding example
I personally invest with Holdfolio. Its purchase and retention platform consists of 10 rental homes within a single portfolio. These houses are bought, rebuilt for rent, and then rented. 60% ownership is provided to investors (the crowd) with a minimum investment of $ 10,000. 40% of the property is in the hands of the Holdfolio management team. The returns posted when I invested over a year ago were 10% to 14% and I am currently getting returns of 11% annually. With each new portfolio, an additional 10 houses are offered to investors with an average pool fund amount of $ 320,000, typically filled within 4-5 days. Holdfolio has just finished Portfolio 10 and will soon begin Portfolio 11. This is just one example of many crowdfunding platforms.
Summary
Real estate crowdfunding is becoming increasingly popular these days as investors turn away from stocks to seek higher returns in other markets. Make sure you do your homework and narrow your search to the first three. If this is your first time, once you make your selection, start with a smaller amount until your comfort factor allows you to do more.