Realty Mogul Review
RealtyMogul is one of the strongest crowdfunding real estate sites for mainly accredited investors. RealtyMogul has distributed over $100M, has 180K members, and has financed over $2B to 300 properties so far.
RealtyMogul, based in L.A., has branched out to commercial real estate deals around the country. RealtyMogul is intended for non-accredited investors and accredited investors. They have MogulREIT I and MogulREIT II if you want to buy a portfolio of crowdfunding real estate deals.
Why Is It a Good Platform
There are several reasons why RealtyMogul is a major crowdfunding platform for real estate.
1: RealtyMogul Does Due Diligence
Many important pieces of information are reviewed before investment opportunities are accepted and released to investors.
RealtyMogul shall have due diligence on behalf of its investors. Here are five key criteria that they consider during the due diligence process.
(a) Real Estate Business
The first thing to look at when evaluating an investment is the real estate company involved in the project. This is also known as a “sponsor” – a person or a real estate company that will purchase real estate and carry out a business plan.
(b) The Market
The second thing we’re looking at when it comes to investing in real estate is the property market. Realtors say that the only thing that matters is “location, location, location” and not without justification.
(c) The Assets
While the real estate company and the market are both significant, so is the asset or the property. It is important to review not only whether it is the right time in the real estate cycle, but also whether it is the right time to purchase the asset. The asset is so important to the investment that we make an in-person site visit to RealtyMogul for every investment.
(d) The Capital Structure
When investing in commercial real estate, the capital structure must be carefully considered as having a significant impact on the return.
In addition, real estate companies can further complicate the capital structure of a deal by adding a combination of a second lien, preferred equity or mezzanine debt as a liquidity layer between the senior mortgage and the common equity. The terms of each part of the capital have a material impact on the others.
(e) Risk and Return
The last, but not least (and perhaps the most important), aspect that an investor will consider when deciding whether to invest in an opportunity is the risk/return of the project.
If it has been decided that each of the elements of the transaction is on the mark, balanced, and effective enough to fulfill the specified investment objectives, then it is worth considering making an investment in the opportunity.
2: RealtyMogul Investor Benefits are Top Priority
Real estate investors all benefit greatly from RealtyMogul, which further makes these people a reliable source of potential wealth.
For example, RealtyMogul is offering:
2.1) Pre-Vetted Investments—Less than 10% of the transactions first seen on Realty Mogul make it to their investors’ platform. The review goes through the past of the sponsors, the track record, and the individual histories. This is to ensure that the offers have the highest chance of providing a positive return.
2.2) Quick Process To Invest — Real estate crowdfunding is largely due to its ease of investment. Realty Mogul’s platform allows investors to examine the research agreement in depth. The investor can view photos, videos, and even ask the sponsors questions before making an investment.
2.3) Opportunities More Focused Than REITs — Publicly traded REIT typically has dozens, if not hundreds, of properties in its portfolio. Publicly traded REITs are also more volatile than bonds, as we saw in the fall of March 2020. It is more difficult to invest in specific areas of the country with a public REIT. Real estate crowdfunding with Realty Mogul allows you to be a lot more surgical in your investments.
2.4) Low Investment Minimum – Instead of making a $200,000 down payment for a median-priced San Francisco or NYC property and investing $1,000,000, you can spend as little as $10,000 in real estate on the Realty Mogul platform to gain exposure.
3: RealtyMogul Makes Properties More Accessible
With RealtyMogul, investors can diversify their investment in real estate through a wide range of opportunities available across the world. Such incentives include commercial real estate ventures that would normally take 10 million dollars from individual investors.
RealtyMogul provides more opportunities for more people through the power of crowdsourcing. This, in effect, puts potentially lucrative real estate investments within the reach of the average investor.
Examples of investment include:
- Multi-family houses,
- Office buildings,
- Industrial facilities,
- Medical premises,
- Hospitality sites
RealtyMogul allows average investors to invest in single-family properties that are acquired for renovation and flipping purposes. Just about any property can be invested in as long as it is not used as a primary home or a secondary residence.
4: RealtyMogul Simplifies the Process of Investment
With RealtyMogul, investors typically buy shares in a Realty Mogul Limitated Liability Company (LLC) that turns around and invests the money in an LLC or Limited Partnership (LP) the owns real property.
Investing in this way minimizes overheads for fund investors and offers access to further investment opportunities, as well as streamlines the recording of distributions across the network.
Loan investments are usually 6-12 months, while equity investments range from three years to 10 years. Equity investments usually pay out dividends on a quarterly basis, while debt investments pay out on a monthly basis.
5: RealtyMogul Is Trustworthy
Since its inception in 2012, Realty Mogul has distributed over $100M, has 170K members, and has funded over $2B in property deals.
It is important to note is that as of 2020, Realty Mogul did not raise any additional venture capital money, but it is still advancing. This indicates to me the Realty Mogul has found a way to be more self-sustaining because they concentrate on price, not quantity. Unlike other sites, they do not expand at any price and are based on the bottom line.
Considering that they have higher barriers for whom they do business, it seems like they’re more concentrating on hitting singles and doubles instead of home runs, which is more in line with how I like to run my own business.
Conclusion of the Review
RealtyMogul makes real estate investment open and convenient for accredited investors and non-accredited investors alike. The platform began in 2012 when the JOBS Act was passed. The CEO is a long-term business pro advocating productivity and growth.