While entrepreneurs have been using crowdfunding to finance a huge variety of projects for years it is really just now catching on in the real estate industry. So how can crowdfunding be used for wholesaling properties and why try it?
Even though millions of dollars have been raised with crowdfunding for everything from green supermarkets to reviving community buildings and even home purchases it is surprising how many real estate investors and Realtors are completely unaware of its existence and how it works.
This is pretty shocking given the amount of attention it has received in the press recently. Fortunately, it isn't too late to leverage it. There are many companies which provide the best real estate crowdfunding platforms.
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As the term suggests crowd-funding essentially means raising money from the crowd (public or other investors) to fund a project. This provides another alternative source of capital for financing real estate deals and developments.
There are a number of different types of strategies which can be deployed here. Most property industry experts are already familiar with the concept of pooling money from other investors to fund a project and offering a return in exchange.
However, other options here include giving up a piece of a new entity for buying, selling or holding property, or raising contributions without giving up any ownership or fixed rates of return.
Crowdfunding can be used for wholesaling properties of all types from land and lots to commercial real estate projects in all sectors as well as houses and portfolios of rental homes or bulk sales of distressed properties.