TOP CROWDFUNDED REAL ESTATE INVESTMENT PLATFORMS

General Pros and Cons of Crowdfunded Property Investing

WHY YES?

  • Able to get into a high-cost asset class with small amounts of money 
  • Hassle-free investing – no personal property management required as it’s all done for
  • Documents including title deed sent to investors once filed with the regulatory authorities
  • Able to diversify property locations and invest in multiple high yielding locations
  • Even if in a down property market, diversification and low minimums help reduce risk

 WHY NOT?

  • Low liquidity – true for the whole asset class – minimum time to exit is usually 5 years (for early exit you must request the company and wait for someone in the pool to buy your stake)
  • Property valuations fluctuate and there are management fees – true for the whole asset class
  • Not a lot of say in property purchase/management/sale decisions – specific to crowdfunded real estate investments
  • Unable to personally view the property – impractical when crowdfunding anything though

 

  1. SmartCrowd

WHO ARE THEY?

SmartCrowd is a real estate crowdfunding platform, plain and simple. Users can receive rental dividends by buying and owning shares of whole property units.

They use a Special Purpose Vehicle (SPV) system to buy and own real estate. They are the first and largest regulated crowdfunding property investment platform for the Middle East market

ELIGIBILITY: Investors worldwide 

MINIMUM INVESTMENT: AED 500 or USD 140

INVESTMENT COSTS/FEES:

  • 4% transaction fee (split as 1.5% during purchase + 2.5% during sale)
  • 0.5% admin fee annual on whole portfolio amount

PRIMARY HANDLING CURRENCY: AED and GBP

REGULATED BY: Dubai Financial Services Authority (“DFSA”), United Arab Emirates 

WHY THEM?

  • High monthly dividend yields than the competition (usually 5-8% per annum)
  • Most listings are converted to holiday homes doubling your dividend yields
  • Able to deposit via wire transfer and by linking your bank account to your portal directly
  • Trust building – CEO and team very involved with the crowd with webinars and seminars
  • Easy to use portal design
  • Statistical and analytical metrics and all legal deeds and documents within the portal accessible after login for both current portfolio and listings

WHY NOT THEM?

  • Unable to deposit via credit/debit card
  • Takes a longer time than predicted to get deed and contracts compared to the competition
  • Dividend notifications sometimes delayed
  • Compliance process is a bit more drawn out

TRIED THEM OUT? (Level 1-5 scale)
Level 5 – Invested, making returns/made sale 

Sign up for SmartCrowd to learn more

 

  1. Stake

WHO ARE THEY?

Stake is a new real estate crowdfunding player in the UAE’s growing property fintech arena. They have a highly competitive structure and astounding property listings with a low minimums model. Dividends are paid out monthly and they use a Special Purpose Vehicle (SPV) system to buy and own the real estate.

ELIGIBILITY: Investors worldwide. Age 18+

MINIMUM INVESTMENT: AED 2000 or USD 540

Special offer for the first month of Expo 2020 festival is, 1 AED minimums + 5% cashback on deposits

INVESTMENT COSTS/FEES:

  • 4% transaction fee (split as 1.5% during purchase + 2.5% during sale)
  • 5% admin fee annual on whole portfolio amount
  • 15% of profit if property sold at higher price than total funding target (this is not a fee basically)

PRIMARY HANDLING CURRENCY: AED and USD

REGULATED BY: Dubai Financial Services Authority (“DFSA”), United Arab Emirates 

WHY THEM?

  • Property listings in fancy and hyped locations (good for the hype and brags, not really for returns)
  • Superb low minimum offers dropped occasionally (e.g. 1 AED minimums)
  • Easy onboarding but thorough compliance
  • Able to deposit with both card and wire transfer

WHY NOT THEM?

  • Lower dividend yields than the competition (usually 4-6% per annum)
  • Minimums differ across properties
  • Platform is not very attractive and highly developed as user cannot easily see the most important stats such as dividend yield on the listings page itself
  • Unable to open multiple listing opportunities with right click to make comparisons

TRIED THEM OUT? (Level 1-5 scale)
Level 5 – Invested, making returns/made sale

Sign up for Stake to learn more