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Monthly Newsletter Archive:
(note: per user request, the monthly newsletters were replaced with instant email notifications on November 2017.)
I hope everyone had a happy Halloween. I'm sending out the November newsletter a little early, because there's been so much content already. (Also, per your feedback, this will probably be the last monthly digest and we'll be switching to article by article notification so you can get the information quicker.)
First, we completed our 2017-2018 review of the top 14 nonaccredited offerings. Honors were awarded for most experienced sponsors, best core plus funds, best debt, most aggressive, best fees, best variety and most socially conscious. We also did a beginner's guide to choosing nonaccredited offerings, since that's a confusing thing for many. (more...)
We have tons of new reviews, analysis and private features to celebrate in October:
The 2017-2018 real estate crowdfunding industry rankings and in-depth reviews are finally in!
An earthquake ripped through the industry with a small handful of sites at the top thriving and improving, and a much larger number struggling (investor complaints, inadequate volume, not evolving past limitations, etc). And 5 new sites debuted in the rankings as well: Instalend, AlphaFlow, ckmack, sbrefunds and IncomeAnd. Additionally 2 older sites: Roofstock and Realty Shares ended the industry-wide funding drought, which was great to see.
By popular demand, I also wrote an article on my own seven-figure real-estate portfolio, and how each part of it has been doing. You can also see my "quick and slow" strategy at work as I prepare for the next recession.
There's a new private area of the site for registered investors only (registration is free). It includes things that just can't be published on the public side of the site, like detailed due diligence summaries of everything in my portfolio, group specials and discounts (saving $ tens of thousands of dollars in reduced minimums). Plus there's an area where all investors can ask for help on doing due diligence on their potential new investments, and exchange new ideas.
It's been a crazy month for everyone. The industry had its own ups and downs with storm winds to deal with. DiversyFund was accused by the government of undisclosed compensation, inaccurate records, and other financial misdeeds. iFunding investors were relieved that the company bankruptcy is not going to suck down their investments. Realtyshares announced that it has exited the residential hard money loan origination business.
And investors are being rocked by hurricanes too. First the new cell phone port scam has stolen millions of dollars from the bank accounts of sophisticated computer users. And the fallout from the massive Equifax hack poses potential identity, financial and medical theft issues to 62% of Americans. We have 3 articles on what these are and how to protect yourself from the dangers. (more...)
I hope your end of summer hasn't been too hectic. A lot has happened in the last month.
In an announcement that was not too surpising, iFunding announced they're insolvent. Investors say some of the bankruptcy protection they had believed was in place (splitting up the investments into individual LLCs) was not actually there. And since no backup administrator was specified in advance, all of their investments will get sucked into the bankruptcy proceedings unless they can agree on a plan to avoid it. More details are below.
One of the biggest problems with crowdfunding is the almost complete lack of conservative, quality deal flow. In an exciting development, one of the major platforms is willing to help change that, if enough of you are interested. If you'd like this, please take the survey so we can do that.
Plus a lot more. (more...)
Due to health reasons, I'd been unable to post a newsletter for several months. But now I'm back, and so much has happened that this is the biggest newsletter update ever. Here's an extremely brief overview.
Fund That Flip became just the third site to go with complete transparency and publish its performance (which was looking very good). Roof stock launched in Los Angeles. Realty Mogul updated us on the final status of their foreclosures discussed in a previous article. And, the SEC announced that Rich Uncles is under investigation for it's marketing practices.
Lots of investors are complaining about problems with their hard money loans. So we did an in-depth three-part tutorial on understanding the risks, and my personal checklist for due diligence.
Average, every-day, nonaccredited investor (in any state) can finally invest in real estate crowdfunding. I did a 2 part article comparing the 3 available options (Rich Uncles, FundRise's eREIT and RealtyMogul.com's REIT) on 9 different features.
Several platforms temporarily waived fees or offered incentives to attract new investors and investments. And Equity Multiple earned huge kudos when it becamethe 2nd company in the industry to deliver full transparency on past investment performance.
But not all was rosy. Patch of Land saw another high profile executive departure and one investor reported that 15 of his 40 investments with the company were delinquent. Another investor reported a rare Peerstreet loan going into foreclosure.
In financial industry news, the Wall Street Journal predicted trouble for commercial real estate in 2017. And many financial advisors showed their true colors by throwing a fit at new rules designed to force them to act in their client's best interests. With $17 billion per year in padded fees to be lost, their fight will continue into 2017 and beyond. (More...)
In industry news, RealtyMogul announced a REIT investment for non-accredited investors. This move allowed them to join FundRise as the second national provider to target non-accredited investors. I personally see pros and cons for both companies' offerings. So I'll be doing a detailed comparison of the two in the near future.
Crowdfund platform FundThatFlip recently added true bankruptcy protection to their offerings. I applaud their efforts to improve investor safety.
Finally, the industry is in a tumultuous time and the next recession is looming. How do you invest in such unusual circumstances which still preserving captial. I've written a two part article on my investment strategies. I talk about what I personally am avoiding and what looks interesting to me. (More...)
There's been an earthquake of changes in the industry since last year, and so it's no surprise that the rankings have changed a lot too. Several newcomers pushed their way up into the top 10, including Lendinghome, Roofstock and Fund That Flip. Several former champs stumbled and fell. (Former co-#1 Patch of Land dropped to #8, and Fundrise plummeted to #25). And the new #1 is Peerstreet. It's the first site in the industry to post the performance of every investment, and it reveals an outstanding performance record.
In the news, lots happened over the last several months. Patch of Land conducted "secret" mass layoffs, Fundrise accused its CFO of extorting $1 million, and iFunding was hit with a 2nd lawsuit. Also, our site ranking system was mentioned in Bloomberg News and several other news sources across the nation. (More...)
Prominent portal Ifunding was sued by a sponsor. Fundrise introduced an eREIT that was flooded with new investors, despite substantial investor dilution, fees, lack of transparency and more. We added two new tutorial series on making investment choices. One contrasts the advantages and disadvantages of commercial versus residential real estate. The other does the same for equity versus debt investments. At the macro level: Residential real estate home prices are soaring. Commercial real estate is expected to get a boost from capital fleeing the stock market as well as new regulations allowing in foreign money. And at the same time, frothiness/overheating in the New York marketplace have caused Fundrise to stop offering individual investments. Costar predicts volatility issues with multi family investing in 2016 and recommends moving to class B and triple net lease. (More...)
As the holiday season approaches, numerous sites are playing Santa and awarding hefty bonuses for investing. Some of the most generous included Acquire Real Estate (free Apple TV) and PeerRealty ($500 credit). Investors were unhappy with two Realty Mogul hard money loan investments that faced bankruptcy/foreclosure issues. This news prompted a controversy over whether nationally based hard money lenders are more risky than local. And we did a tutorial on how to avoid losing money on bad hard money loan investments. Finally, we interviewed the man who literally wrote the book on commercial real estate investing. MIT's Dr. David Geltner explained what to expect in the next downturn and tips and techniques to improve your return.. (More...)
We released the industry's first comprehensive ranking of the 100+ sites, along with indepth reviews of the top 20. Groundfloor admitted non-accredited investors, PeerStreet offered a 1% rate bump for referring a friend, and Bank of America moved heavily into real estate. We also added new detailed tutorials on protecting your portfolio from the next downturn. We did this through a 3 part series on the physical and financial commerical real estate cycles. And we also interviewed cycle guru Dr. Glenn Mueller, who shared crucial insights on crash-proofing your investments. (More...)
Realty Mogul leapfrogs to #1 with $35 million funding round. FundRise releases "diversified fund" which falls short. Real estate commercial real estate cycle guru, Dr. Glenn Mueller, says apartments are in hyper supply nationwide. A $500,000+ real estate crowdfunding investor, shares his secrets. And we added two new investment tutorials on the four real estate investment types, and how to manage their risk/rewardprofile and various times in the market cycle. (More…)
The SEC finally implemented regulation A+, but its impact was a whimper instead of a bang. Patch of Land got high points for strengthening the investor protections in their standard contracts. And we added 10 new investment tutorials for you: ranging from portfolio allocation to contrasting real estate crowdfunding investing with consumer loans. (More...)