Real Estate Crowdfunding: Low-Cost Investment for Long-Term Passive Income

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Real Estate Crowdfunding: Low-Cost Investment for Long-Term Passive Income

Real Estate Crowdfunding

If you desire to grow wealth, the passive income options via real estate crowdfunding in real estate are appealing. Fortunately, you don’t need thousands of dollars to get started. Even better, you don’t have to maintain or operate the property yourself.

What is Passive Income?

Passive income is revenue earned without the requirement for active labor or participation on a continuous basis. You earn money without exchanging your time for money like you would with a job. Sure, passive income does not wholly imply a lack of labor. Often, there is some upfront work required to set up a passive income source. However, after your investment is made, you no longer need to participate in order to make money.

Passive income investments are rarely the first thing that comes to mind when you think about commercial real estate investments.

Developing a portfolio of rental properties is the goal of many real estate investors. But, residential real estate properties require active labor and a lot of money.

Feels like the end of your dreams? No! Real estate crowdfunding to the rescue!

The good news is that you may earn passive income from real estate crowdfunding without ever having to worry about a broken toilet spoiling your night. What’s more, you won’t need hundreds of thousands of dollars to get started.

What is Real Estate Crowdfunding?

Suppose a developer real estate or experienced investor finds a commercial real estate investment building in one of Mumbai’s affluent areas. The property is now worth Rs. 6 crores but is missing modern facilities. According to market analysis and other needs, the developer or investor concludes that if the property is rehabilitated at a total expense of Rs. 5 crores and then leased out, the asset has the ability to reach a market value of Rs. 20 crores over the next 6 to 7 years.

However, the developer or investor does not have the necessary finances to rehabilitate the building. Instead of seeking a loan, the investor can turn this into a real estate crowdfunding opportunity whereby a team of investors or individuals pay individually for the project.

This presents dual benefits. Builders can utilize the funds collected to create or renovate a complete real estate project. Investors can now qualify as shareholders in assets., Thus, it aids in portfolio diversification.

Real Estate Crowdfunding for Commercial Real Estate Investment: The Best Passive Income Investment

  • Passive Income Investment: Real estate has long been seen as a reliable source of passive income. Many third-party crowdfunding platforms now provide commercial real estate investment management for a modest charge. This eliminates the need for you to manually maintain the investment while still collecting monthly returns.
  • Passive income via Dividends: Real estate crowdfunding offers consistent passive income returns regardless of investment type, with dividends paid quarterly or monthly.
  • Minimum Investment Amount: With merely INR 25 lacs, crowdfunding has turned real estate investing much more accessible. Previously, commercial real estate investments were only accessible to HNIs. But, now an average investor can invest in large commercial real estate investment projects thanks to real estate crowdfunding platforms.
  • Access to deals: Investors pool their cash with others on an online real estate crowdfunding platform. Furthermore, companies may be able to engage in larger transactions as a result of crowdfunded investment. Online real estate crowdfunding platforms provide as much information on operating partners and assets as feasible.
  • Diversification: You can diversify your risk profile by participating and investing in various markets. You may invest INR. 25 lacs in 20 different real estate markets in India. Because different platforms have significantly lower investment minimums, you can distribute your hard-earned money over multiple investments. You may then collect passive income from these multiple investments.
  • Varied Investment Options: Contracts are available on real estate crowdfunding sites. This enables individuals to invest in additional homes and enter the real estate market without having to pay a large chunk of money upfront. Because everything is done online, there are a lot of unique properties to look at, and investors aren’t confined to their local real estate market.
  • No management issues: Commercial real estate investment crowdfunding is the best strategy to start your real estate investing adventure and earn passive income. Handling properties and coordinating renters takes a lot of time and effort. But via real estate crowdfunding, you may focus on optimizing your assets since there are zero management duties on your hands.

Bottom Line

Commercial real estate investment crowdfunding is a great way to start investing in real estate and earning passive income. When you put less money into an investment, you generally minimize the risk. Before you begin investing in real estate crowdfunding, it’s vital that you understand all the advantages and disadvantages. You may use this information to create a risk assessment for your investment. Investors should conduct thorough research on real estate crowdfunding platforms and real estate projects before investing for better investment decisions.

Partnering with trustworthy alternative investment platforms like Assetmonk can help to simplify and boost the passive income earnings of real estate investing. Assetmonk provides varied real estate investment choices, including thorough dependable property management, transparent reporting, and due diligence.

FAQs

Q1. Is real estate crowdfunding legal in India?

A. Yes, real estate crowdfunding is permissible and legalized in India.

Q2. What is the average return on real estate crowdfunding?

A. The average return on real estate crowdfunding ranges from 10 percent to 12 percent.

Q3. How to invest in real estate crowdfunding in India?

A. The best way to invest in real estate crowdfunding in India is via real estate crowdfunding platforms. These platforms connect developers and investors.

Q4. Which is the most trusted crowdfunding platform in India?

A. Assetmonk is one of the most trusted alternative investment platforms in which you can invest in crowdfunding projects.

Q5.  Does real estate crowdfunding pay dividends?

A. Real estate crowdfunding offers consistent returns irrespective of investment type, with dividends paid monthly or quarterly.