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Real estate crowdfunding platforms like Fundrise and CrowdStreet1 have made it easier to invest in real estate without requiring the amount of money needed to buy a property on your own
Both real estate platforms typically provide various investment options, which can help you tailor your real estate portfolio to your specific preferences and goals. But which platform is better? Let's compare Fundrise versus CrowdStreet to find out the answer.
- Fundrise vs. CrowdStreet: At a glance
- Fundrise: What it is and how it works
- CrowdStreet: What it is and how it works
- 3 important differences between Fundrise and CrowdStreet
- Fundrise vs. CrowdStreet: Which investment app should you choose?
- FAQ about Fundrise vs. CrowdStreet
- Bottom line: Fundrise vs. CrowdStreet
Fundrise vs. CrowdStreet: At a glance
Fundrise and CrowdStreet target two different types of real estate investors. Depending on your financial situation, how much you have to invest, and your investing goals, one may be a better fit for you than the other. Here’s a quick rundown:
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| Minimum investment | $10 | $25,000 |
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| Investment accreditation | Not required | Required |
| Best for... | Real estate investors who don’t qualify as accredited investors and new investors who want to dip their toes into the real estate market or generate supplemental passive income | Accredited investors who are willing to invest larger amounts of money and let them be illiquid for years |
| Visit Fundrise | Visit Crowdstreet |
Fundrise: What it is and how it works
Fundrise is a real estate investment platform that provides investors with access to proprietary real estate investment trusts (eREITs) and eFunds that aren’t publicly available.
The platform is available to anyone who can meet the minimum opening investment requirement, which is only $10. Fundrise’s investment offerings include multifamily, single-family, and industrial properties. It also offers private equity in tech companies.
Fundrise offers three investment plans for different investment goals:
- The supplemental income plan: Aims to create a consistent income stream and focuses on assets that are expected to generate this type of stable cash flow.
The balanced investing plan: Aims for high diversification and focuses relatively evenly on income and growth-oriented real estate assets.
The long-term growth plan: Aims to pursue better overall returns over the long term and focuses on assets that have a high potential to appreciate in value.
Learn more in our Fundrise review.
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CrowdStreet: What it is and how it works
CrowdStreet is a crowdfunding real estate marketplace that's available only to accredited investors.
Keep in mind
There are several ways to qualify as an accredited investor, including having an annual income of $200,000 or $300,000 if married or being a high-net-worth individual with $1 million or more, excluding a primary residence. This limitation means many real estate investors can't join or invest.CrowdStreet allows you to invest in REITs and individual real estate projects. If you invest at least $250,000, the platform can build a tailored investment portfolio based on your needs and goals.
CrowdStreet offers various types of properties, including multifamily, Single-family, industrial, and business properties. For example, it previously funded investments in storage facilities, hotels, homes, research and development facilities, and more.
Learn more in our CrowdStreet review.
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3 important differences between Fundrise and CrowdStreet
As with any financial decision, it’s important to compare and contrast each option to determine the right fit for you. Here are the main ways Fundrise and CrowdStreet differ from each other.
1. Accessibility
Fundrise is more accessible than CrowdStreet. Fundrise doesn’t require you to be an accredited investor to join, so it doesn’t matter what your income or net worth is. You just need to have enough cash to meet the minimum investment requirement, which is only $10.
With CrowdStreet, you can join only if you meet the accreditation requirement — which you’ll need to verify before you can become a fully-active member. The minimum investment on the platform is $25,000.
Winner: Fundrise since it has a low investment minimum and no accreditation requirement.
2. Fees
Fundrise charges annual advisory and management fees that range between 1 and 2%. That’s about average for a traditional managed investment fund.
On the flip side, CrowdStreet doesn’t charge any fees to its participating investors. However, the sponsors of the deals you join may charge their own fees.
Winner: Tie. Some investors may prefer the clear fee structure of Fundrise, while others may prefer having no platform fees with CrowdStreet.
3. Investment options
Fundrise doesn’t offer access to individual properties. You can invest via REITs and eFunds — you can join in both residential and commercial real estate investments.
CrowdStreet does provide more options to people who qualify, including REITs and individual deals. You can directly invest in residential and commercial properties on the platform.
Winner: CrowdStreet since it offers individual property deals.
Fundrise vs. CrowdStreet: Which investment app should you choose?
Neither of these real estate platforms is inherently better than the other, and both of them made our list of the best investment apps. So it’s important to know your situation and your goals to determine the right fit for you.
For most real estate investors, CrowdStreet likely won’t be an option because of its accredited investor requirement. Beginners and non-accredited investors who want to invest in real estate will find Fundrise a lot more accessible.
If you're an accredited investor and qualify for both platforms, you should consider a few different factors to determine which platform is the better fit for you.
For example, you should consider the investment options you're interested in. If you want funds and individual deals, CrowdStreet is the better option. But if you prefer the diversification of a REIT and don’t want to invest a lot, Fundrise may be the better choice.
Another important factor to consider is the cost. Fundrise has a fixed rate for its advisory and management fees. Although CrowdStreet doesn't charge fees, you may still pay fees based on the sponsor of the deal you join.
FAQ about Fundrise vs. CrowdStreet
Can you really make money with Fundrise?
As with any investment, investing in real estate doesn’t guarantee you’ll make money. And although past performance doesn’t guarantee future returns, Fundrise provides its track record. Here are the company’s average annualized returns for the past several years:
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One thing to keep in mind is that REITs and eFunds provide diversification, which you can’t get with individual real estate properties. A diversified portfolio typically lowers your risk. However, you may still see losses.
Is CrowdStreet a good investment?
Like Fundrise, CrowdStreet doesn’t provide any guarantees when it comes to returns. However, it provides some historical performance numbers2 based on deals that have sold in the past to give investors an idea of what they might expect:
- Average internal rate of return: 19.2%. The internal rate is the rate at which an investment breaks even. If the IRR of an investment is greater than the required rate of return or the cost of capital, the investment is considered profitable.
- Average equity multiple: 1.58X, which represents the total cash distributions from an investment divided by the equity invested.
- Average hold period: 3 years, which is the amount of time between the purchase of a deal and its sale.
Is CrowdStreet for accredited investors only?
Yes. In order to join CrowdStreet, you must be an accredited investor. There are several ways to qualify as an accredited investor. For example, you can qualify by having a net worth of at least $1 million, not including your primary residence, or by earning at least $200,000 annually or $300,000 if you’re married. You’ll need to verify your status as an accredited investor before you can invest on Crowdstreet.
Which is better, CrowdStreet or Fundrise?
Neither real estate investing platform is better than the other for all investors. As you're considering how to invest money through Fundrise vs. CrowdStreet, consider your eligibility, funds available to invest, financial goals, and personal preferences.
For example, if you want to invest in office buildings or multifamilies, either platform could be good for you. But if you’re looking for single-family rental properties, Fundrise could be the best real estate platform for you. Carefully review the features, resources, and terms of each option to determine which platform is the better choice for you and your situation.
Bottom line: Fundrise vs. CrowdStreet
If you’re wondering how to invest in real estate, an online platform could be a good place to start investing. Real estate could be a way to create supplemental income and achieve long-term growth when it comes to your wealth. However, liquidity with real estate investments is typically limited.
For real estate investors of all levels, crowdfunded platforms can provide you with excellent access to REITs and other real estate investment opportunities. Both Fundrise and CrowdStreet are popular real estate investing options, but depending on your situation and goals, one may be better than the other.
You should do your due diligence to make that decision for yourself while taking your personal risk tolerance, financial goals, and investment strategy into account.
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Crowdstreet Benefits
- Get access to unparalleled institutional commercial real estate
- CrowdStreet has launched 560 deals
- $360M in investor distributions and new deals listed with high frequency
- Limited to accredited investors
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