Roofstock vs HomeUnion
- Property management services
- In-depth vetting process
- Low fees
- Wide range of investment options
- Full property management services
- Streamlined buying process
Real estate investing has always been a popular method of generating passive income and holding a tangible asset. In recent years, investing in bricks and mortar has paid dividends due to heated real estate markets across the country.
The profitability within the market has been exacerbated by historically low-interest rates and the fact there is a supply shortage of more than five million homes. Roofstock and HomeUnion are two platforms that have capitalized and allowed smaller investors to get exposure to real estate.
When comparing Roofstock vs. HomeUnion, which platform is the superior prospect for the average investor? Let’s dive into each platform and weigh them up against each other.
Roofstock Overview
Roofstock is part of the new wave of online real estate platforms aimed at beginners. You can invest in single-family rental properties with a relatively small outlay. The platform has vetted every property to ensure they meet the high standards expected by investors. This system reduces the risk of being scammed or getting into a bad deal.
Roofstock One also offers a crowdfunded approach to investing in real estate. You can purchase shares of a home at $5,000 per share. If you lack the funds to buy a home outright, this is an excellent way of diversifying your portfolio.
Launched back in 2015, Roofstock has acquired more than $133 million in initial venture capital. Investors see this platform as a gamechanger and buying a home with Roofstock has fulfilled its promises.
Every property is a turnkey property, which means whenever you buy real estate with Roofstock, you already have a property suitable for renting out. Our Roofstock review believes this is one of the best options for getting into real estate with limited experience.
Roofstock Details
| Account Minimum | $0 |
|---|---|
| Management Fees | 0.5% |
| Property Types | Single-family rentals |
| Investment Type | Direct equity and property shares |
Purchasing a property via Roofstock investing couldn’t be simpler. Begin by creating an account and searching the site for properties. There are properties in more than 70 regional markets, with full insights, analytics, and research to help you make an informed decision.
Every property has been verified and checked to ensure that Roofstock users gain access to only the most reliable investments. This is the platform created by real estate investors for real estate investors.
After selecting your chosen property, you can make an offer. You are not required to take the pre-negotiated price. You can make your own offer, and if the seller accepts, you can begin the purchasing process.
Roofstock has created a streamlined purchasing option to help you secure financing and deal with all the obligations associated with closing. The average closing time for a property within the U.S. today when taking out a mortgage is 30-60 days.
When you use Roofstock, you can close in as little as 15 days. This accelerated closing time makes the platform such an attractive proposition.
Roofstock Fees
Roofstock charges minimal fees. In most cases, the costs of buying and closing on a new rental property are far lower than you would pay if you attempted to close a sale independently.
Whenever you purchase a home via Roofstock, you are treated like a buyer with any realtor. The difference is you gain access to other essentials, such as legal documents, property management, and tenant screening.
The cost of brokering your purchase with Roofstock is 5% of the purchase price. Compared to average commissions nationwide, this is reasonable.
If choosing to purchase shares in a home, you will pay 0.5% per year on the assets you hold.
Roofstock Pros
- Property management services
- In-depth vetting process
- Low fees
Roofstock Cons
- Large down payments
- No in-person property viewings
- Repairs are still on you
Moving into property investing can be intimidating, but Roofstock has streamlined the process to make it as convenient as possible. To learn more about how the platform works, read our review on Roofstock.
HomeUnion Overview
HomeUnion is Roofstock’s primary competitor in this marketplace. It shouldn’t surprise you that they offer a similar product.
Unlike Roofstock, HomeUnion does not specialize. When you create an account with HomeUnion, you can access a range of property types, including single-family rentals and four-family complexes.
New HomeUnion members will be prompted to answer a simple three-question survey to narrow down the properties that may be of interest to them. Like Roofstock, all properties on the website have been thoroughly vetted by the platform’s team of real estate professionals.
The buying process takes place entirely online. After committing to a purchase, you are free to use HomeUnion to find renters for your new property. The platform also covers property maintenance, but you will still be expected to pay out-of-pocket for any major repairs and renovations.
As you can see, there is little difference between HomeUnion and Roofstock in terms of the product they offer.
HomeUnion Details
| Account Minimum | $0 |
|---|---|
| Management Fees | 5% of the gross rent |
| Property Types | All types of residential property |
| Investment Type | Direct ownership and property shares |
Firstly, HomeUnion does offer both a direct ownership and crowdfunding approach to property investing. Unfortunately, the crowdfunding platform remains in its infancy and only offers shares in single-family rentals.
Although HomeUnion offers a complete set of services for buying and managing your rentals, it falls in the sense that these properties do not come with a pre-screened tenant already living there. While they offer tenant-finding services, you will still need to wait until your new property generates rental income.
There is no purchase guarantee policy with HomeUnion. Roofstock allows you to get a full refund within 30 days of closing. HomeUnion compensates for this by including all property management and repair fees within their monthly 10.5% fee.
HomeUnion also operates in fewer markets. With its growing membership, you will likely find yourself investing in difficult markets that are already overheated. Furthermore, if you choose to take out a mortgage, you will be expected to put down a minimum of 20% of the purchase price.
HomeUnion Fees
There are no fees to open an account and begin browsing the platform’s real estate listings. The cost of HomeUnion’s acquisition fee is 3.5%, which is lower than Roofstock.
On the other hand, HomeUnion charges a hefty 10.5% fee for the rent collected every month. Your expenses will, therefore, vary every year based on the changes in the real estate market.
The only advantage of the fees charged by HomeUnion is you gain access to a property manager who will handle everything on your behalf. Again, you rely on the platform to find a suitable tenant for your home.
The only guarantee is that your management fee will never amount to more than 10.5%, regardless of what kind of tenant HomeUnion puts in your rental property.
HomeUnion Pros
- Wide range of investment options
- Full property management services
- Streamlined buying process
HomeUnion Cons
- No crowdfunding for most property types
- High monthly management fee
- Limited regions to invest in
HomeUnion offers an extremely similar product, and the addition of more property types is a welcome bonus. The only downside mentioned in reviews on HomeUnion is the lack of accessible markets.
Roofstock vs. HomeUnion Comparison
| Feature | Roofstock | HomeUnion |
| Min. Investment | $5,000 via Shares | $10,000 |
| Management Fees | 0.5% per year | 10.5% of the gross rent |
| Property Type | Single-family homes | All residential property types |
| Investment Type | Direct ownership and property shares | Direct ownership and property shares |
| Property Management? | Yes | Yes |
| Refund Guarantee | 100% within 30 days of closing | Not stated |
| Best For | Beginners | Beginners |
Roofstock vs. HomeUnion: Which One is Right for You?
At first glance, it is difficult to see the difference between Roofstock and HomeUnion. Both are comprehensive services that make it easy to jump into property and generate a monthly rental income.
The streamlined purchasing processes of both sites allow anyone to get involved, even if they have never purchased a rental property before. HomeUnion has the edge on fees, but their management fees make up for these.
It is also worth mentioning that while they both offer crowdfunded property purchases, the $5,000 minimum on Roofstock beats out the $10,000 minimum at HomeUnion. If you are a smaller investor looking to diversify, Roofstock is the superior option.
Overall, there is not much to choose between Roofstock and HomeUnion, but at Good Credit Info, we favor the former due to its approach to lower minimum investment amounts. Generally, you cannot go far wrong with either platform.
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