Invest in real estate without buying a house

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What is the meaning of the sentence with which Fellow Funders participated in the SIMA 2023 Salón del Inversor Inmobiliario (SIMA 2023 Real Estate Investor Fair)?

The answer lies in real estate crowdfunding, which has consolidated its position as an alternative form of investment in the real estate sector over the last few years. This approach allows investors to participate in real estate projects without necessarily purchasing entire properties that require extensive capital or previous experience in the market.

How did the implementation of real estate crowdfunding become possible?

Technology has been a core driver of real estate crowdfunding’s growth. Online platforms facilitate investments by allowing investors to access projects and transact anytime and anywhere.

These platforms also provide investment tracking and management tools, enhancing the investor experience. Moreover, technology enhances the transparency and security of transactions.

Real estate crowdfunding paved the way for property investment in different countries and regions. Investors can participate in real estate projects in their home country or abroad, offering the opportunity to diversify investments geographically and capitalize on trends and opportunities in different real estate markets. This diversification can also protect against the volatility and risks associated with a single market.

In the real estate crowdfunding model, investors gain access to comprehensive information about the projects they wish to invest in. Platforms provide details about developers, project location, construction plans, expected returns, and other relevant data with feasibility plans developed by experts. This transparency allows investors to make informed decisions and perform detailed analyses before investing.

Regulators have implemented measures to protect investors as real estate crowdfunding has grown. Real estate crowdfunding platforms are subject to specific regulations and legal and disclosure requirements, providing investors with increased security and confidence when participating in real estate crowdfunding projects.

What are the core keys to success in real estate crowdfunding investment?

  1. Democratic access to real estate investment. One of the main trends in real estate crowdfunding is democratizing access by facilitating minority investors to participate in projects that would otherwise not be possible. Real estate investment was previously restricted to large investors or financial institutions. However, real estate crowdfunding now allows anyone to invest in real estate projects with lower amounts of capital (from €500 in Fellow Funders).
  2. Portfolio diversification. Real estate crowdfunding provides investors with the possibility to diversify their investment portfolios. They can invest in different real estate projects, including residential housing, commercial properties, or urban developments, reducing risk by spreading investments across various property types and geographic locations. Moreover, investors can choose projects that fit their preferences and financial objectives.

In summary, real estate crowdfunding introduces several trends that have transformed investment in real estate. Democratic access, portfolio diversification, transparency, use of technology, diversification, and increased regulation are driving the growth and evolution of real estate crowdfunding.

These trends offer investors unique opportunities to participate in the real estate market with greater flexibility and lower entry barrier.

As an accredited provider of equity crowdfunding services in Europe, Fellow Funders offers equity crowdfunding services with selected projects for different investor profiles to design their diversified investment portfolio. Each project includes rigorous and detailed documentation from the analysis carried out by Fellow Funders’ experts so that investors can make the right decisions about their alternative investment.

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