CrowdStreet Review
 | By: Jeremy Biberdorf | March 6, 2022 |
In a Nutshell: CrowdStreet gives accredited investors an in into real estate projects. You will need to think long and hard and do sufficient due diligence before making a commitment to the platform as your money will be tied up for the long term, and it has a very high account minimum. Not to mention, you will need to be risk-tolerant.
| Account Minimum | Fees | Investment Options |
|---|---|---|
Pros & Cons
Pros
- Private equity real estate access
- Intuitive website
- Possible passive income opportunities
- Offers educational resources
Cons
- Only for accredited investors
- High account minimum
CrowdStreet Overview
Real estate is where a lot of big money is, but one drawback is CrowdStreet only opens the doors to private equity real estate investing for accredited investors. The platform is a marketplace for big-time investors with deeper pockets or public entities to make institutional-level investments.
What is an accredited investor and how do you become one? An accredited investor is one who has a minimum net worth of $1 million, individuals who have a $200,000 annual salary, or couples with a combined $300,000 annual income.
CrowdStreet does a lot of the legwork for you and vets all of the developers extensively, doing background checks and reference checks so you don’t have to. This move is a major win for the platform because it saves investors a ton of time. But even so, we still recommend doing some digging of your own.
CrowdStreet Features
While there are no fees involved to sign up to the platform, CrowdStreet does command a pretty hefty minimum sum of around $25,000 (depending o the project), so it makes sense that you want to know what you can get out of the platform.
Educational Resources
Aside from having a help guide to get you started, CrowdStreet also offers an abundance of educational resources. Get expert insights with helpful articles and instructional videos that answer questions about reviewing projects and understanding returns. The knowledge you can get from the resources can also be applied to other forms of investments.
Detailed Vetting Process
s we said, CrowdStreet does a lot of the work for you. The platform vets every project and developer extensively and compiles all the information for you to access at your fingertips. To gain knowledge about a specific project, investors can refer to videos and webinars that go into detail so you know whether or not the project is a good fit.
You can even actively ask questions to the project sponsor during live webinars or watch a recording of it at your own convenience. CrowdStreet is very transparent in every deal and will not try to stonewall you when you want to get in touch with those behind each project. In fact, CrowdStreet goes out of its way to facilitate the process.
Crowdstreet aims to offer the best deals for investors, and they do so with explanations every step of the way. You can check out the Investment Thesis feature and video series within the resource section to understand how CrowdStreet conducts evaluations.
Access to Complex Real Estate Investments
Yes, there is a threshold you must meet in order to enjoy the perks of the platform (being an accredited investor), but if and when you do, the opportunities in real estate can be very lucrative.
Be prepared that your money will be locked in a long-term hold, as is the standard with most real estate investments. That is a caveat that may deter some investors, which brings us to the next section.
Is CrowdStreet Right for You?
Investing in real estate and diversifying your profile in a major way sounds amazing, but is CrowdStreet the right one for you?
There are some things to be aware of before making your decision:
- Real estate investments offered on CrowdStreet are locked in for years
- You must still conduct due diligence despite CrowdStreet’s vetting process
- Each project is different with varying periods and returns
- Some projects may fail
- You may take losses, as you would with any type of investment
- You have to be accredited
The criteria above can be tough to meet, especially the last one of being an accredited investor, but that doesn’t mean real estate investing is out of reach for you. You have the option of investing in REITs, or real estate investment trusts, which are available to all and have lower thresholds.
REITs are also liquid, unlike CrowdStreet projects which are not. However, the rise and fall of REITs tend to follow the overall market, while CrowdStreet options can sometimes act as a hedge against that and diversify your holdings. Learn more about what CrowdStreet can do for you. If you have the funds, have the time to do some research, and don’t mind long-term holds, then CrowdStreet is excellent.
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