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Passing the JOBS Act as a law in April 2012 made crowdfunding real estate as the latest buzz words to hit the United States, particularly the financial services industry. Crowdfunding platforms are an avenue where small investors can pool money collectively to purchase shares of a property. Investors can buy commercial centers, office buildings, houses or apartments to make profits out of it and increase their return on investments. Crowdfunding for real estate projects are a better way of purchasing an entire property with other members than deal with the stress of renovating the building and look for tenants with a smaller group of people. With crowdfunding, you can find all kinds of help from different people across the continent, making land development easier for you. The best thing about crowdfunding real estate is that US securities laws generally support startup business in raising capital. This allows private individuals to buy shares that were once limited to them. As a matter of fact, the JOBS Act is intended to ease strict regulations on investments in small companies, especially those startup businesses that only make less than $200,000 annually and whose net worth is only $1 million. Prior to the act’s passage, such companies could only sell shares to people who can exceed those financial limitations, or the so-called accredited investors. Crowdfunding companies nowadays are able to focus on creating various property-investing programs, giving people a variety of investment selections. Based on the law, non-accredited investors may put $2,000 per year into closely held crowdfunding projects. Most crowdfunding companies are positive in the promising future of this new investment vehicle, including the upcoming rules and regulations by the Securities and Exchange Commission. Crowdfunding real estate is different from real estate investment trust (REIT). REIT is where investors are provided with little information about the actual details of the property being bought to develop. In crowdfunding, investors are free to invest in individual properties while being provided with transparency in the transactions and gain some control over choosing the right investment location and option. Conversely, REITs are mostly composed of bigger entities that limit smaller investors to participate in. Crowdfunding opportunities can reach even investors who can only invest $100 in a project while having the chance to select investment options across niches. Whatever your real estate investment option is, you must know how these projects will benefit your objectives. A successful crowdfunding real estate company will bring you closer to several, fruitful investment opportunities. For example, a company may offer you to invest in purchasing a restaurant, to which you will be entitled to a piece of the property’s value and profits. You can share a pool of your money to an investment you never had before as a way to get involved in your community, and that’s what crowdfunding can give to your in return. Crowdfunding real estate is a way for small businesses to be in active participation in the market on a larger scale. It gives you an opportunity to own a real estate property that you thought unlikely to happen before.
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