Real estate crowdfunding, advantages and disadvantages

Crowdfunding has become one of the most popular methods of raising funds today. What's more, some already claim that it could become the new form of project financing in the future. It has proven to be so useful, that it has also started to be used in real estate projects.

But what is it and how does it work?

What is real estate crowdfunding

Real estate crowdfunding, also known as collective investment of projects, consists of investing in the real estate sector jointly with other investors, without the need to make a large investment of money.

What does this mean?

Crowdfunding allows you to diversify your investments and own multiple properties while taking fewer risks than if you did it alone. Thus, the process allows individual investors to access the real estate market without having to own, finance or manage properties.

How real estate crowdfunding works

Real estate crowdfunding is a new opportunity for real estate investment based on the collaborative economy. It consists of identifying a real estate project, setting a limit amount to invest and pooling it into a common account through the contributions of several micro-investors.

Once all the capital has been raised, the project is financed and from this, profits are generated that will be distributed among all investors in proportion to what each of them invested.

It should not be confused with buying and selling projects, because in participatory financing, investors do not acquire ownership of the property or work, but rather the right to receive the proportional part of the profits they generate. Nor should it be confused with real estate tokenization, because in the case of the latter, it includes blockchain technology to carry out all investments (in this article we explain The differences between crowdfounding and tokenization of real estate )

Most often, this type of financing is used for projects in their initial phases; mainly those that are still under construction or remodeling or improvement work with the intention of renting or selling a property.

Main real estate crowdfunding platforms in Spain

• Inveslar

This was one of the first web portals specialized in Crowdfunding in Spain. Located in Barcelona, it has all its investment projects in this region, and allows you to invest starting at 100€.

• Privalue

This page is defined as the first Real Estate Crowdfunding open to all types of investors and projects in Spain. Its main motto is:”Build well-being”.

Its team is made up of experienced developers in the central areas of Madrid and Barcelona, where you can find their different projects. They are strong supporters of environmental health, and admit investments starting at €1,000, offering returns of up to 17%.

• Housers

Housers has become a giant of Real Estate Crowdfunding. It is well known and valued by a large part of the industry community, and its growth has been abysmal.

It accepts investments starting at 50€ for each project, and a new feature of this platform is that it offers a Big Data tool.

• Urbanitae

As stated in its motto “Real estate investment for all profiles”, Urbanitae's main objective is to offer users a diversification of their savings through investment in different real estate projects.

It accepts investments starting at 50€ for each project and includes a wide portfolio of projects.

Is Reental a real estate crowdfunding?

To answer this question, let's look at the main characteristics of real estate crowdfunding:

• These are digital portals through which, with a couple of clicks and in real time, you can access a wide range of information related to different real estate projects in an online showcase.
• Through these portals, you can make the necessary inquiries about the project or projects in which the investor is interested.
• The investor can check their projects at any time of the day and from anywhere.
• The investor gets a profitability proportional to the capital contributed to each project.
• This is a type of participatory and collective funding.

Paying attention to all these characteristics, and to the nature and operation of Reental, we can say that Reental could fall into the Real Estate Crowdfunding category. However, there is a The clear difference between Reental and crowdfunding platforms is that Reental owns the properties it manages, while crowdfunding platforms connect developers and investors but are not the owners of the asset.

This is a double guarantee for our customers. As we are the owners, we will try to make sure that the property generates as much as possible because our profit depends on how well we do it. If they win we win, but if they lose we lose even more.

On the other hand, real estate is a guarantee of company liquidity, keeping us away from the volatility of the crypto world.

In addition, the Reental model proposes the use of blockchain technology and the tokenization of digital assets, as a differentiating effect, allowing greater added value to the investor holding the tokens.

If you prefer to be a primary witness, you can see it with your own eyes at our official website.

Advantages of investing in Reental vs traditional real estate

It is a fact that invest properties with Reental offers many more advantages than investing in traditional real estate projects, and among the main reasons we highlight the following:

• Financial inclusion. Reental has made significant progress in terms of financial inclusion by offering investment opportunities to a large part of the population that previously did not have this possibility.

• Say goodbye to barriers to entry. Anyone can invest. The property is divided into tokens worth 100€ each. So that anyone can invest in a property from only 100€.
• Invest in seconds and from anywhere in the world. Buy tokens with your credit card or with crypto from your wallet and get your tokens immediately, from wherever you want and when you want.
• You can de-invest whenever you want. Do you need your capital? You recover your investment by selling your tokens to a third party or swapping them into our liquidity pools, thus turning investment in real estate into an investment with great liquidity.

• Very low investment cost. Simply, the gas required to execute the transaction on the blockchain (the commission charged to us by the network). A negligible expense compared to the usual expenses in the purchase and sale of real estate.

Why invest in Reental and not in other platforms

As we have already commented in real estate crowdfunding, advantages and disadvantages, our differential value is that we use Blockchain technology and tokenization. Real estate tokenization refers to the division of real estate into small digital parts, called tokens, that can be bought and sold in a similar way to a company's shares. This allows investors to buy part of a real estate without having to purchase it completely, which can be more accessible and profitable than real estate crowdfunding traditional. In addition, the tokenization of real estate allows greater liquidity and facilitates investment in real estate at an international level, which may be attractive to certain investors.

Try to look for these advantages in traditional real estate investments and, come back to tell us if you have found something similar or not. Investing in Reental has stopped becoming an option and now it is a must that every investor must carry out.

What are you waiting for to start diversifying your portfolio?