When it comes to at-home investing, real estate is certainly not a sector or “genre” that springs to mind. Robo and auto advisors are more popular than ever, and for good reason: their accessibility and algorithmic nature save us time, and lots of it. Thus, most of us are content to deal in the common stocks or odd mutual fund which robo-advisors tend to facilitate.
As a result, real estate is fast becoming an underappreciated market. We think this is due to the kind of mental image which “real estate” evokes. When most people think of real estate investment, they naturally picture buying and selling homes, becoming a landlord, or renting out a room – potentially irksome situations, to say the least.
But this is not the only way to get into real estate. If you prefer the more passive approach associated with robo-advisors, there are options out there for even the most tepid of prospectors.
Take REITs, for example. REITs are companies that own, operate, and maintain rental facilities. REITs are a way for the average individual to connect to the world of large-scale estate. What’s more, some popular robo-advisors, such as M1 Finance, grant investors exposure to real estate through bond and real estate investment ETFs.
In actuality, this makes real estate assets no different than common stocks. But if you want a more direct, hands-on approach to buying land and property, consider something like the investing platform AcreTrader. AcreTrader is a fresh approach to real estate, as it affords ordinary people the opportunity to invest in farmland across the United States.
Modest Money’s review of AcreTrader calls it “novel”, a way to passively “make money through annual tenant fees and land appreciation”. Founded in 2018 by industry maverick Carter Malloy, AcreTrader has steadily grown in popularity, and cite annual appreciation rates of 7-9%.
Perhaps the most intriguing aspect of AcreTrader, as opposed to standard real estate investment trusts, is that investors get a real sense of the property they are investing in. By providing a brief description of each available farmstead, investors are drawn into the “story” connected to each and every property.
But farmland is not the only real estate investing option available through crowdfunding. In fact, “crowdfunding” has revolutionized the way we look at real estate investment opportunities. By using internet technologies such as social media and popular message boards to comb interest in burgeoning real estate ventures, platforms such as CrowdStreet and Fundrise open onto a whole world of investing opportunity.
Let’s take a closer look at these platforms, emphasizing CrowdStreet and AcreTrader.
CrowdStreet – Accessible Real Estate
A platform that should appeal to accredited investors who are rather new to the game, CrowdStreet provides easy access to commercial real estate deals.
Founded in 2013, CrowdStreet is one of the higher volume and more trusted names in real estate crowdfunding platforms. With over 467 commercial real estate opportunities, this is a platform that should appeal to even the most jaded of investors.
CrowdStreet packs a number of appealing features:
- Easy-to-use application: intuition is CrowdStreet’s motto, and their application interface and website reflect that. Easy to get started and use, CrowdStreet will have new users plugged into the matrix of real estate investment in no time.
- Research: investing with CrowdStreet is no shot in the dark; rather, the resident experts compile data into a detailed video webinars about each and every investing project. Learn exactly what you are buying into and if it fits your portfolio’s profile.
- Investing guidance: again, this is another reason why CrowdStreet is so darn newb friendly: with a resource section corresponding to each investing project (commercial opportunity), one gains access to a kind of insider’s knowledge via instructional videos and articles. To boot, CrowdStreet offers a number of educational resources dedicated to general real estate investing.
AcreTrader – A Hidden Gem?
Founded in 2018 by Carter Malloy, AcreTrader is a novel platform that puts investors in touch with America’s rustic backbone. Geared towards farmland investment, Malloy’s intention is to open farmland to the average retail investor.
Farmland has been notoriously underappreciated, a sector lost amid the glitz and glamour of tech and big pharma. And with annual appreciation rates somewhere in the ballpark of 7-9%, this is an area of investing that simply cannot continue to be ignored.
Let’s take a closer look at what makes AcreTrader a growing name in alternative real estate.
- Ease of Use: AcreTrader gets praise for its simple, user-friendly interface. If you’ve ever used a robo-advisor, nothing will seem out of place here. What’s more, its very simple to get up and running: once you’ve set up a user account and linked it to an existing bank account, you’re on your way.
- Information and Knowledge: We’ve found that one of the great things about AcreTrader is how they provide a brief “narrative” for every farmstead available for investment. Having a backstory to go along with your investment gives you a sense of knowing, or directly encounteringthe land.
- Investment Thresholds: $10,000 is the minimum amount one can invest on AcreTrader, and investors are required to purchase at least one acre of land.
The Bottom Line – Real Estate and the Long Haul
Real estate has an entirely different feel and complexion when compared to typical trading ventures. While it may lack the kind of turbulence that day traders thrive on, we believe that real estate is an essential part of any balanced portfolio designed for the long haul – this is “buy and hold” territory.
While many of these services are currently only available to accredited investors, we think it only a matter of time until they are opened to the general public. As real estate becomes a central piece to the global investment puzzle, demand will follow.
If you have the means and the patience, start the venture today – there is a whole world of opportunity left to explore.