Fundrise vs RealtyShares Comparison

fundrise vs realtyshares

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In this Fundrise vs RealtyShares comparison, we review fees, investment minimums, geographic diversity, and investment focus so you can make a more informed decision between two of the leading online real estate crowdfunding sites.

Perhaps the biggest difference right off the bat is you need to be an accredited investor to participate in the offerings by RealtyShares whereas Fundrise is accessible to non-accredited investors.

If wealth level is not a deciding factor then you will want to consider how long your money is tied up, which states are excluded from coverage, and whether you can invest using your retirement accounts.

RealtyShares vs Fundrise Comparison

Real Estate Investingfundrise logorealtyshares logo
ReviewsFundrise ReviewRealtyShares Review
Minimum Investment$500$5,000
Dividend FrequencyQuarterlyMonthly or Quarterly
Fees1%
(annual fees)
1% → 2%
(annual fees)
Commercial
Residential
Single Family
Private REIT
Geographic CoverageNationwideNationwide
(excluding AK, ND, NV, SD, VT)

 

Why Choose RealtyShares or Fundrise

The major attraction to RealtyShares or Fundrise is the opportunity to invest in real estate versus the stock market.

For investors who are risk averse or want stable income, online real estate crowdfunding sites are a way to diversify away from the stock market to an asset class that is usually less volatile.

Whether commercial, residential, or single family homes whet your appetite, both Fundrise and RealtyShares cater to them all.

History has shown that investing in real estate has been lucrative. Over certain time frames, it’s even eclipsed the performance of the stock market.

Research shows that real estate returns between 2002-17 averaged 10.34% annually versus just 6.69% for the S&P 500 index.

Unless you’re a good stock picker or can scout out high quality dividend-paying stocks, companies like Fundrise and RealtyShares offer a way to earn passive income monthly or quarterly.

Why Invest Via Crowdfunding Real Estate Sites?

Commercial Property FeaturesYES/NO
Tax benefits
Tangible asset
Inflation hedge
Cash flow from day one
Uncorrelated to stock market
Investment portfolio diversification
Passive income
Buy with leverage

What Is RealtyShares?

RealtyShares is a marketplace that connects investors with companies in need of financing for real estate projects.

Investors pool money together to buy a portion of each real estate project.

What Is Fundrise?

Fundrise is an online crowdfunding website that features two main products:

  1. eREIT, which is like a private real estate investment trust
  2. eFund, an investment vehicle used to buy land and property for development

Both products pool investor monies with a view to gaining exposure to commercial property, residential real estate, or single family homes.

Fundrise vs RealtyShares
Minimums

RealtyShares Investment Minimum

It’s no surprise that RealtyShares, which is designed for accredited investors with a minimum of $200,000 in income in two consecutive years or $1,000,000 in net worth, has a higher minimum of $5,000.

In some cases a minimum of just $1,000 is accepted.

Fundrise Investment Minimum

The investment minimum at Fundrise is lower, ranging from $500 → $1,000.

The Fundrise eFund product which pools investor monies, buys land and properties for development, and sells on to residential homeowners has a $500 minimum.

The eREIT which is more like a private real estate investment trust has a $1,000 investment minimum.

Fee Comparison

RealtyShares Fees

Depending on which RealtyShares product you choose, the fees will range from 1 → 2%.

On equity investments, the RealtyShares fees are 1% while a 2% interest rate spread on debt is applied.

Fundrise Fees

The cost to invest in Fundrise products is capped at 1% annually.

 

Fundrise & RealtyShares
Investment Focus

RealtyShares Investments

RealtyShares is a peer-to-peer platform connecting investors to real estate projects in need of financing.

Some of the highlights of RealtyShares include:

  • Access to residential and commercial property investments
  • Access to private deals across the country, including:
    • Multi-family
    • Offices
    • Fix and flips
  • Deals selected and underwritten by investment professionals

Fundrise Investments

Fundrise offers investors exposure to residential real estate investments and commercial real estate investments in its eREIT.

In its eFund, investors who have an appetite for risk can choose to gain exposure to single family homes.

Performance Returns

Fundrise Vs Realty Shares

Fundrise Returns

The performance of Fundrise, net of fees, since inception has been:

YearFundrise Performance
201711.44%
20168.76%
201512.42%
201412.25%

RealtyShares Returns

RealtyShares features a wide variety of investment projects on its platform and returns vary by:

  • Project
  • Geography
  • Offering type
    • Equity
    • Preferred equity
    • Senior debt
  • Asset types
    • Single family homes
    • Retail
    • Multifamily
    • Office

Fundrise vs RealtyShares
Comparison

RealtyShares WinsFundrise Wins
Variety of Projects: As a peer-to-peer marketplace, RealtyShares doesn’t buy properties or manage them but connects investors to a wide variety of projects led by experienced, vetted real estate professionals.Low Fees: A management fee of 0.85% and an advisory fee of 0.15% is charged by Fundrise for a total annual fee of 1%.
Monthly Dividends: Some projects on the RealtyShares platform pay monthly dividends whereas quarterly dividends are paid out at Fundrise.Geographic Exposure: Unlike RealtyShares, which is not available in all states, Fundrise has full nationwide coverage.
Passive Income: Investors seeking a regular income from investments can find projects that best suit their financial aims among the wide variety of projects.Investment Minimum: The minimum to get started with Fundrise ranges from $500 to $1,000 depending on which product you choose compared with $5,000 at RealtyShares.
1031 Exchange: You don’t need to own property to qualify to invest in a 1031 exchange that has Federal tax deferral benefits.Non-Accredited Investors: You don’t have to have a swollen bank balance to get started with Fundrise, whereas you will need to be accredited to invest on the RealtyShares platform.
Returns: The historical returns produced by Fundrise have been impressive and the company is transparent about performance returns.

RealtyShares vs Fundrise
Comparison Summary

Between RealtyShares and Fundrise, the only option is Fundrise for non-accredited investors.

When it comes to fees and investment minimums, Fundrise also gets the nod. The minimum investment amount at RealtyShares is 10x larger than Fundrise’s eFund product.

For investors seeking passive income monthly, RealtyShares has projects available to cater to your financial needs whereas Fundrise pays out dividends quarterly.

Historical returns at Fundrise are transparent and impressive. Plus, Fundrise is available nationwide whereas geographic restrictions are in place when investing with RealtyShares.

Overall, we award Fundrise the victory but accredited investors should certainly check out RealtyShares.

 

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