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14 Reasons You Should Invest in Crowdfunded Real Estate

Aug 23, 2016

Crowdfunding has totally disrupted the global investment model, providing new opportunities for investors of all kinds. In real estate alone, crowdfunding has altered the way people invest in property, turning an industry that was previously bogged down in paperwork and middle-men into a hassle-free way for people to grow their money with just a few clicks.

Crowdfunding has also taken investment out of the hands of high-net-worth individuals and opened up the market to anyone with a computer – you no longer have to be on the “inside” to have access to opportunities to invest. By allowing people to invest smaller amounts and share the overall investment, the high capital that was previously required to invest is no longer a restriction.

Geography is also no longer an issue, which is especially significant for the real estate market. Property investment used to be a local endeavour, but Real Estate Crowdfunding now allows you to invest in real estate that’s situated thousands of miles from your home. This means that people can now capitalise upon the profitability of popular global cities without needing to actually live locally, providing them with a better chance to make more stable, long-term gains.

The opportunity crowdfunding represents for investors is now being realised in almost every sector. Now is the time to get involved – here are a few numbers that demonstrate the profitability of this phenomenon:

  • The crowdfunding industry is now worth a staggering US$34.4 billion as of 2015. Its growth has been meteoric: the sector expanded by 167% between 2013-2014.
  • Crowdfunding in Asia alone saw a 320% growth in volume in 2014.
  • Europe is expected to have experienced a 98.6% growth when 2015’s numbers are finalised.
  • 47% of millennials are now likely to or have already participated in crowdfunding.
  • The crowdfunding industry is predicted to be worth over US$300 billion by 2025.
  • Real Estate Crowdfunding grew by 156% in 2014.
  • Projects funded in 2014 using Real Estate Crowdfunding ranged from under US$100 000 to over US$25 million, demonstrating the diversity that exists within the industry.
  • Last year’s figures show that despite being still in its infancy, equity crowdfunding raised an estimated US$ 2.5 billion, and this was even before the implementation of the clauses of the U.S. JOBS Act that pertain to crowdfunding investment, those that allow non-accredited inventors to take part.
  • One analysis from Forbes suggests that crowdfunding will surpass venture capitalism in 2016, with VC averaging a US$30 billion a year valuation, compared to crowdfunding’s current US$34.4 billion.
  • Real Estate Crowdfunding firms worldwide are now collectively worth an estimated US$2.6 billion.
  • By the end of 2016, institutional investment portfolios are predicted to dedicate 26% of their investment share to alternative investments such as real estate and equity crowdfunding – it is now accepted that including alternative investments in your overall investment strategy makes your portfolio more stable in the long-term (as outlined by the Yale model of investment).


Sources: https://techcrunch.com/2016/04/23/technology-is-finally-eliminating-geography-as-a-barrier-to-real-estate-investing/;

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5-2 Wohnresidenz Zogernitz, Vienna

5-2 Wohnresidenz Zogernitz, Vienna

Vienna, Austria

Estimated Avg. Annual Return*1.8% - 3.8%

Total Invested€ 564,500

74% Funded € 564,500

Target € 760,000

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15421 Sussex Street, Detroit

15421 Sussex Street, Detroit

Detroit, United States of America

Estimated Avg. Annual Return*9.8% - 11.8%

Total InvestedUS$ 49,750

53% Funded US$ 49,750

Target US$ 94,320

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