Crowdfunded real estate is more than just a new way to invest in real property. For many novice and wannabe investors, it may be the ONLY way. Buying real property in Canada, particularly in and around Vancouver, requires significant capital – more than most folks can manage to put together. So, while the dream of investing in real estate in the hope of building equity and earning passive income is alive and well, reality presents numerous obstacles to seeing that dream come true. The bad news is that for most people, especially young people, real estate investment through conventional routes is too costly and time consuming. The good news is that crowdfunding offers a chance to overcome these obstacles and reap the benefits of owing real estate through a game changing mechanism accessible to all.
Real estate investment through a crowdfunded platform such as addy comes with a few built-in advantages over other more traditional forms of real estate investment. Here are a few of the top reasons why everyone should consider making crowdfunded real estate part of their portfolio.
Affordability
First, and most importantly, crowdfunding allows everyone to own a piece of the pie. Through addy, you can buy shares in a property for as little as $1. There is no other way to own real property without a significant initial down payment or minimum investment. Do you want to invest in real estate, but find yourself short on capital? Micro investing with others through a crowdfunded platform like addy will you access to strong, long-term investment returns through ownership of real property.
Diversification
Most young working people have the good sense to start saving for their future through some combination of cash, equities, stocks and bonds. Crowdfunding presents an opportunity to diversify that savings portfolio by incorporating real estate. Instead of owning shares in numerous properties as you would in a REIT, an investment in crowdfunded real estate will allow you to focus on a single property – perhaps one in your own backyard – in a manner that would not be feasible otherwise.
Hassle-Free Property Ownership
Even for those fortunate enough to consider purchasing investment property on their own, there are other concerns beyond the obvious financial barriers. Let’s start with the simple fact that not everyone is cut out to be a landlord. It’s a job that requires focus, hard work and more than a few different skills. Successful landlords wear many different hats while functioning as financial analysts, real estate agents, accountants, and mechanics. Before buying that two-family home with great income potential, you really must ask yourself if you will be willing and able to drop what you are doing to care for the property every time there is a maintenance need or unexpected interference courtesy of Mother Nature. There will always be snow to shovel, grass to cut, leaves to rake and leaky pipes to repair.
If you already have a fulfilling day job and prefer to spend your leisure time pursuing other passions, crowdfunded real estate investment may be the perfect choice for you. Leave the property sourcing, monitoring, tenant screening, government bureaucracy and middle of the night “emergency” calls from tenants in the hands of experienced professionals while you sit back, relax and watch your investment grow.
