- Hey guys, what's going on?
Seth here from the REtipster blog.
I wanted to put together this video
as a follow up to a video review
I did about a year go.
The original video was an in-depth review
of a company called Fundrise, which is a real estate
crowd funding platform that allows regular people
to take their money and invest it into pools of real estate.
So, basically if you're in the stock market
or if you just want to get into real estate investing
but you don't want to do all the hands-on work,
it's a really easy way to take your money
and throw it in real estate, diversify a little bit,
and just wait for the returns to come
(assuming they come at all).
So, if you haven't seen that, definitely go check it out.
It does a really good job of explaining
what real estate crowd funding is all about
and specifically how Fundrise works.
One of the things I did in that original video
was, I took people into the site,
showed them what it looked like, how to sign up,
how to actually invest your own money
if you want to do that, and I actually invested
$1,000 of my own money into Fundrise,
just so people can see what that process looks like.
One of the questions I've gotten a lot from people
who have seen that video is how has that investment
been going over the past 12 months?
Has it made money?
Has it NOT made money?
Has it lost money?
Has it stayed the same?
And I thought it was a really good question.
Being that that happened almost exactly one year ago
to the day that I'm making this video,
I wanted to re-visit this and dive back into the site
and show you what my returns have been,
just so you can see how much money
my $1,000 investment has made.
Again, just let me reiterate, there are NO GUARANTEES
that you'll make any money if you invest
your money with Fundrise.
This is one scenario.
Depending on what the real estate market is doing,
how the economy is doing,
depending on which properties Fundrise has you invested in,
this could go any which way.
But again, this is just how it turned out for me,
so take it with a grain of salt.
Let's dive in and I'll show you how it looks.
Okay, so let's dive into the site.
I do have an affiliate link to Fundrise.
Absolutely no obligation that you need to use this,
but if you do, and if you sign up through this link,
I get a small commission.
So, just wanted to mention that
and be totally forward about that,
but if you go through that affiliate link
to the Fundrise home page, you'll see something like this.
Let's go ahead and click on this Fundrise logo and log in.
And then once we are logged in,
you'll see this is what my returns look like.
If we go up here to transactions
and just see the history of what happened here,
I originally invested my $1,000
into Fundrise on March 27, 2017.
At the time of this recording, I'm recording this
on March 19, so it hasn't quite been a full 12 months,
but it's been really, really close to that,
like almost exactly a week away from being a full year.
And in that one year timeframe,
my $1,000 has produced close to $81.
So if we go ahead and do the math on this,
if we go $80.77 divided by the original
$1,000 investment that I made, that's a little over 8%
for just putting my 1,000 bucks in there
and just sitting on it and doing nothing.
So that's quite a bit better than obviously putting it
in my bank account and just sitting it on that.
And it's also quite a bit better than putting it
in a lot of other things that would earn me
a much lower return than that.
At the same time, it's nothing like stellar.
Like if I were to just take that money
and buy my own piece of real estate and either fix it up
or flip it or rent it out or do anything with it
that I normally know how to do,
I could make a lot more than 8%.
But there's something to be said for just being able
to park your cash and not do anything, not think about it,
just let Fundrise do what they're gonna do with it
and make my return that way.
And also, it is a little bit different.
I don't just get my entire $1,000 back whenever I want it.
So I have to wait quite a while before I can get that back.
I think the typical turnaround time is about five years
before I can get all that invested principal back.
But in the mean time, if we go back here
to this transactions section of the site
where you can see the history.
I originally put in my $1,000 back on March 27, 2017
and each quarter I've been paid dividends.
So that first quarter I got $21.09.
The next quarter I got $22.29.
The next quarter I got $20.72.
The next quarter for this year hasn't quite
been paid out yet so I don't see that here,
but it's worth nothing that the way I originally
set this up was for Fundrise to just automatically
reinvest my dividends back into Fundrise.
So that probably did have an effect on my returns as well.
If I wanted to, I could have just
taken that cash and run with it
if I didn't have them reinvest those dividends.
So that's just something worth noting as well.
That's why this says principal invested $1,064.10,
not just the original $1,000 I put in there.
And of course, keep in mind,
this is a very, very, very small-scale investment.
This is literally as small
as you can possibly get with Fundrise.
Say if I was putting in $5,000 or $10,000
or $100,000 right off the bat,
obviously all these numbers would be much higher.
So say if you've got like 100 grand
and you just want to park it somewhere
and make an income from that, I mean,
Fundrise is one potential way to do that with,
of course, the apparent risk that
it is possible you won't get that return.
But as you can see in my case, I did.
So, alternatively, say if I had put $10,000 in here,
then you could basically just add another zero
to each one of these numbers
and that would have been my quarterly income.
Or if I had put $100,000 there,
you could add another zero to these,
and then my quarterly income would be
a couple thousand dollars each quarter.
I'm not here to give you investment advice.
The purpose of this video is to simply show you
what my experience was like
and what the returns have looked like,
but, I mean, as I look at this kind of thing,
since I don't really have control over where the money goes
I'm kind of trusting Fundrise to be smart
with the money I give them and to put it into
pools of property that are actually going
to earn a return and make me money.
I sort of see this kind of investment opportunity
not as something where I would throw all my eggs into this,
but more as a diversification tool.
So, for example, I have rental properties,
I have a land investing business.
Both of those businesses I control everything.
I know exactly which properties I'm going to own
under each one of those businesses.
I can control how much I list them for,
how much I sell them for,
what I do to improve those things, if any.
So I have total control over that, which is a great thing,
but it's also a ton of work to do all that stuff.
With Fundrise, I don't have that control
and my returns are much lower,
but I also don't have to do any work.
So it's kind of like a give and take thing
where there are certain pros and cons
to this kind of investment.
And I definitely would not put all of my money into this,
but I think it is worth considering if you just want to take
a slice of your overall pie and say,
hey, I want part of my income to be something
that's fairly mindless and fairly predictable.
And I can just put my money in there and, ideally,
it will make a small income.
So, personally, that's kind of how I view Fundrise
and that's sort of how it will fit into my overall picture.
Probably not gonna go out tomorrow
and take 100 grand and throw it into this,
but if you believe in this kind of thing,
and if you're confident in or if you just have
that much money and you want to put it into
a real estate crowd-funding platform,
that's one potential route you could take.
Just with the knowledge that
this is not a guaranteed investment.
It's totally possible that things could not pan out
under that whole eight to nine to 10% return
that everybody is hoping they're gonna get.
So, as long as you're okay with that risk,
then Fundrise could be a great option for ya.
There are other crowd-funding platforms out there
that take a slightly different approach
where you're not investing in pools of property,
but rather you're investing in individual properties.
So really the income rises and falls based on the fate
of that one property and you can potentially make
even more than 8%, like more like 10 to 12, even up to 14%.
Some of the other ones out there are RealtyShares,
PeerStreet, Realty Mogul, EQUITYMULTIPLE.
There's a number of other ones out there.
If you want to check out some of those others,
I've got some reviews that I've done
on some of the other platforms as well,
but if you're looking for more of the REIT model
where you're investing in a pool of properties
and spreading out your risk
on a number of different assets like this,
then Fundrise is one of the platforms
that handles their investment dollars that way.
So, for what it's worth,
I hope this was somewhat informative to you,
and if you're curious or interested in using something
like Fundrise, that's what my experience has been like.
And given that my returns were pretty much right around
that 8% mark, knowing that now, if I could go back
and put a lot more money in there,
I probably would have done it because 8% is not a bad return
for something that takes zero work on my part.
Anyway, that's that.
Hope you found it helpful, and I'll see ya next time.