Investing in real estate is a proven method of building wealth. But the introduction of real estate crowdfunding platforms like Arrived Homes and Fundrise has made investing more accessible than ever. This Arrived Homes Review/Fundrise Review features both platforms, providing a comparison of Arrived Homes vs. Fundrise, helping you determine which suits your investment needs best.
What Is Arrived Homes?
Arrived Homes is a real estate crowdfunding platform that was founded in 2019 by tech veterans Ryan Frazier, Kenny Cason, and Alejandro Chouza with the objective to democratize real estate investing by making it more accessible to a wider range of investors. The platform is based in Seattle, Washington and has received funding from 12 large-scale investors, including Neo and PSL Ventures.
The primary premise of Arrived Homes is to provide anyone the ability to purchase fractional shares in rental properties and earn a passive income while the company manages everything from property acquisition, necessary improvements, and daily operations. The minimum investment required to participate is as low as $100, making it a feasible option for those looking to start investing in real estate.
The properties offered on Arrived Homes are thoroughly vetted for their investment potential. The company follows a stringent due diligence process, only acquiring less than 0.2% of the homes they analyze, ensuring that the properties available for investment are believed to be top-performing assets. The platform primarily focuses on single-family residential properties and is beginning to include vacation rentals as well.
Arrived Homes manages the properties, allowing investors to earn rental income and appreciation with minimal effort. Investors earn rental income, deposited quarterly, providing an additional income stream, and their investment also has the potential to grow as the home appreciates. This unique combination provides the potential for both capital gains and the opportunity to leverage your investment.
As for the fees associated with Arrived Homes, they typically include a sourcing fee that ranges from 3-6% of the property purchase price, and an asset management fee that accounts for 1% of the rental income.
Fundrise: Company Fact Sheet
Fundrise is a financial tech company that has revolutionized the way investments are made in real estate. Based out of the Washington, D.C. metro area, Fundrise provides an SEC-registered crowdfunded real estate investment platform, allowing individuals to invest in real estate without the prohibitive costs associated with conventional real estate investing.
The platform allows investors to put their money in a broad range of real estate investment options, including eREITs (Electronic Real Estate Investment Trusts), eFunds, and Interval funds. eREITs are unique to Fundrise and work similarly to traditional REITs (Real Estate Investment Trusts), but they are more accessible because they’re sold directly to investors online. When investing in eREITs, you can expect a quarterly dividend payment as well as any appreciation that has accrued when the assets investment term expires. eFunds are another innovative product from Fundrise, providing investors with opportunities to invest in real estate developments that are primarily intended for sale, rather than rent.
Fundrise’s Interval Fund is another interesting aspect of the platform. It’s a non-diversified, closed-end management company that operates as an “interval fund.” Unlike open-end mutual funds or ETFs that can be bought and sold on an exchange, the Interval Fund’s sponsor sells shares directly to investors and agrees to repurchase a certain number of shares each quarter.
Fundrise essentially gives you the chance to invest in diverse, high-quality real estate deals with as little as $10. It does so through a process that is similar to investing in a mutual fund, thus providing an opportunity for individuals to gain exposure to real estate without the requirement of being an accredited investor or paying hefty fees.
It is also worth noting that while Fundrise has democratized real estate investment, it’s not devoid of risk. Investing in real estate, like any investment, comes with the potential for losses as well as gains. The unique structure of Fundrise’s products also brings additional considerations, such as their illiquidity and the complexity of the investments.
Risk and Investor Profile: Arrived Homes vs. Fundrise
In the battle of Arrived Homes vs. Fundrise, your risk tolerance and investor profile play a significant role. In a Fundrise vs. Arrived Homes real estate crowdfunding, Arrived Homes is better for those with medium risk tolerance, non-accredited investors, and those looking for low minimum investments. It’s also an excellent choice for both short and long-term investors who have knowledge of real estate investing.
On the other hand, Fundrise is suitable for high-risk tolerance investors, accredited investors, and those looking for lower fees. It’s especially advantageous for long-term investors and novice investors. Fundrise also offers a wide range of property selection and options for traditional or self-directed IRAs.
Key Comparisons
If you’ve been pondering on the question of whether Arrived Homes vs. Fundrise is right for you, understanding the ethos of each platform is key:
- Arrived Homes primarily invests in single-family rental homes, vacation rentals, and individual properties. In contrast, Fundrise’s investments spread across commercial properties, apartment complexes, and Real Estate Investment Trusts. And despite what you may read, there is also no Fundrise promo code.
- Both platforms are suitable for long-term investments. Arrived Homes considers an investment horizon of 5-7 years, while Fundrise recommends a horizon of 5+ years. While both platforms cater to long-term investors, Arrived Homes is also suitable for short-term investors.
Please remember that all investments carry some level of risk. Always do your due diligence before making any investment decisions.
The Verdict
Arrived Homes vs. Fundrise, which one should you choose? Both platforms have their strengths and are transforming the real estate investing landscape. Your choice will ultimately depend on your risk tolerance, investment goals, and preferences. Whichever platform you choose, you’ll have an easy way to invest in real estate without the need for huge deposits.
Ready to take the leap? Click here to start your real estate investment journey with Arrived Homes or click here to explore investment opportunities with Fundrise.
Disclaimer: This article contains sponsored marketing content. It is intended for promotional purposes and should not be considered as an endorsement or recommendation by our website. Readers are encouraged to conduct their own research and exercise their own judgment before making any decisions based on the information provided in this article.
