This unique online platform enables investors to handle the entire commercial real estate investing process right from their RealtyMogul dashboard. With rigorously vetted property listings, expertly managed REITs, and a commitment to providing top-notch service and support to its members, RealtyMogul makes commercial real estate accessible to everyday investors.
- Newer accredited investors who want access to pre-vetted properties
- Non-accredited investors seeking consistent cash flow from well-managed REITs
- Experienced real estate investors who want access to deal-specific information that allows them to perform their own due diligence more easily.
- Do everything from finding the investment property through to signing the legal documents and monitoring your portfolio, all in one platform.
- All properties are pre-vetted through RealtyMogul's transparent and rigorous due diligence process.
- Investment minimums as low as $5,000
- Keep track of investments with regular updates posted directly to your dashboard
- Automated investing
- Individual property marketplace is only open to accredited investors
- Does not offer portfolio management
Realty Mogul Ratings at a Glance
Who Is RealtyMogul
RealtyMogul is an online real estate crowdfunding platform with a mission to bring institutional quality offerings to big and small investors. RealtyMogul accomplishes this by offering a combination of investments that range from its own real estate investment trusts (REITs) to equity offerings in income-generating properties all over the country along with income REITs. On the surface, it sounds like almost every other platform out there.
However, a more detailed look at RealtyMogul reveals an incredibly well-thought-out business model with a clear mission to put income-generating real estate investments within reach of the everyday investor. RealtyMogul has multiple passive income-generating offerings that non-accredited investors can buy into for only $5,000. This feature is in addition to carefully selected equity offerings for accredited investors in high-performing assets like apartment buildings, office properties and storage facilities all over the country.
The idea of a customer-focused platform with high-quality offerings that generate passive income for both accredited and non-accredited investors is incredibly compelling. The question is, can RealtyMogul deliver?
How Does RealtyMogul Work?
RealtyMogul was founded by a dedicated team of financial and real estate professionals who realized that most investors still struggle with access to institutional-quality investments that generate passive income. RealtyMogul seeks to solve this problem in a couple of unique ways.
First of all, RealtyMogul has its own REITs, both of which are open to non-accredited investors. One is a hybrid, debt-equity REIT and the other is a traditional equity REIT. The beauty of both of them is that they have minimum investments of only $5,000. RealtyMogul’s REITs are also available to individual retirement account (IRA) holders (subject to the restrictions of the individual IRA).
Secondly, RealtyMogul has a limited number of carefully selected equity offerings for accredited investors. These offerings have higher buy-ins but are mainly focused on pre-existing properties with a solid performance history and upside in rents. In reality, calling RealtyMogul’s equity offerings “carefully selected” is a bit of an understatement.
No offering appears on the RealtyMogul platform until RealtyMogul’s team makes an in-person visit to the property to assess it up close. Additionally, all potential offerings are run through a highly sophisticated set of data analytics to predict both current and future revenue. Potential offerings must pass both the “eye test” and the “numbers test” before being accepted as platform offerings.
To date, RealtyMogul has issued only 337 offerings out of over 30,000 developer proposals. Once those offerings are approved, investors can find them on an investor-friendly platform that is as comprehensive as it is easy to use.
Every investment platform has costs associated with running it, and RealtyMogul is no different. It’s a necessary evil, and a portion of these costs are passed onto clients as fees. In the case of RealtyMogul, investors face no cost to sign up with the site and browse investments. However, each investment will have its own individual fee structure based on the investment itself and how much administrative work is required.
In the case of the REITs, RealtyMogul’s fee structure can be seen in the chart below.
|Hybrid REIT||Annual Fee Capped at 3%||1% Annual Asset Management Fee (billed monthly)|
|Equity REIT||Annual Fee Capped at 3%||1.25% Annual Asset Management Fee (billed monthly)|
RealtyMogul is incredibly easy to use. The sign-up process is simple and straight-forward with a standard email confirmation and short questionnaire regarding income and net worth. This requirement isn’t a qualification process per se, but it does help establish investor eligibility for some of the equity offerings with the larger buy-ins. Investors who are interested in those offerings will still need to provide proof of accreditation.
However, even without the sign-up, it’s easy to browse RealtyMogul’s current offerings and get a feel for what kind of earnings investors can expect from them. All RealtyMogul’s open offerings can be easily found by scrolling down on the “Invest” tab on the home page. Detailed information about RealtyMogul’s REITs (circulars, corporate by-laws, subscription agreements) are there at the investor’s fingertips. In order to get a look this detailed at the equity investments, you need to provide proof of accreditation.
All things considered, it’s easy to dive right into RealtyMogul and start investing, and that’s the most important thing. It’s a highly functional, well-designed platform that almost any investor would be comfortable using.
No online real estate investing platform is complete without a well-stocked investor education sector. It’s obvious the people behind RealtyMogul understand this need, and its investor education section serves as an excellent backbone for the website. Potential investors can go right to the “Learn” tab on the site’s landing page and access a treasure trove of knowledge about commercial real estate.
The “RealtyMogul Knowledge Center” is a highlight of the platform’s investor education efforts. The best part of this section is a search inquiry bar that lets investors pick whatever commercial real estate topic they want to research. Directly beneath it is a menu of its most commonly searched terms. Topics covered include:
- 1031 Exchanges
- All About REITs
- Passive Income
- Commercial Real Estate
Clicking on any tab will lead investors to a very well-stocked selection of articles and analysis, many of which include videos from RealtyMogul officers. The written material is also very informative and will give readers a good grasp of whatever information they’re looking for.
Another area where RealtyMogul deserves high marks is its Frequently Asked Questions (FAQs) section. The nature of an online investing platform means that potential investors will have a plethora of questions, so the old pre-formatted FAQ pages simply won’t work. RealtyMogul recognizes this, and it has stocked its FAQ page accordingly.
In addition, investors can access a separate FAQ page dedicated to each of RealtyMogul’s REIT offerings. That will come as a particular relief to non-accredited investors who are attracted by the low buy-in but still don’t quite understand how REITs work. It is especially true in light of the fact that RealtyMogul offers both an equity and a hybrid REIT.
Both the FAQ and investor knowledge center are strong, but the shining diamond of RealtyMogul’s investor education is its YouTube channel, “Mogul Insights.” It contains volumes of video tutorials and analysis from many of the key players at RealtyMogul. There is so much information here that it’s literally possible to binge-watch it like a television show.
RealtyMogul goes above and beyond expectations in its investor education efforts. Everything from the brilliant YouTube series to the FAQ page and the quality of information on offer at RealtyMogul’s investor education center is excellent. This aspect earns a well-deserved 5 star rating.
The mere fact that RealtyMogul has offerings available to non-accredited investors is a huge plus. That’s especially true in light of the fact that the buy-ins are as low as $5,000 for the REITs. Better still, investors can choose between RealtyMogul’s hybrid REIT and its equity REIT, which focuses on multi-family real estate. It’s rare enough for a platform to have buy-ins this low, but the fact that RealtyMogul has multiple REITs open to non-accredited investors at that number is simply amazing.
On the accredited investor side, RealtyMogul has a solid, but not huge, selection of equity offerings in a diverse set of commercial real estate around the country. In keeping with RealtyMogul’s business model, these offerings are carefully chosen, and most require a $35,000 buy-in. However, it offers a good range of hold periods in these offerings, ranging from 4 to 10 years. Investors have the chance to earn passive income without necessarily locking their money up for too long.
RealtyMogul Returns N/R
RealtyMogul has a policy of not releasing information on returns from previous investments for compliance reasons. With that said, RealtyMogul’s hybrid REIT has a targeted distribution rate of 6% per year and has successfully made distributions for 57 consecutive months. The apartment REIT has a targeted distribution rate of 4.5% per year and has made distributions in 14 consecutive quarters. The current offerings available to accredited investors are targeting internal rates of return between 15% and 18%. Considering how carefully RealtyMogul vets its investments, it’s not unreasonable to expect these offerings to hit those targets. However, keep in mind that returns are not guaranteed.
RealtyMogul is a solid, high-functioning online investment platform that fills a lot of gaps in the current marketplace. First of all, the presence of both an equity REIT and a hybrid REIT that is open to non-accredited investors is a huge plus for any platform. The idea that investors can buy in for as low as $5,000 and generate more income than they could by parking that money in any bank is incredibly appealing. The low buy-in REITs dovetail nicely with a set of very appealing equity offerings for accredited investors.
Better still, RealtyMogul’s intense due diligence and focus on quality over quantity in its offerings speaks to its commitment to investor satisfaction. When you add that to a well-designed website and an incredible investor education resource like the MogulInsights YouTube channel, you end up with a top platform. Regardless of your accreditation status, if you’re looking for passive income from real estate investments, you would be well served by taking a look at RealtyMogul. It’s a good bet you’re going to like what you see.
RealtyMogul vs Competitors
To date, RealtyMogul has few competitors because it’s such a unique and groundbreaking service. While investors can find REITs or crowdfunding opportunities elsewhere, few other platforms offer an online commercial real estate investment marketplace as reliable as the one RealtyMogul offers its members.
That’s not what gives the fintech company its edge, though. RealtyMogul sets itself apart by prioritizing transparency, ease of access, and scrupulous quality control. Some of the benefits of the platform include:
- Only deals that pass the due diligence process are listed in the marketplace. To date, RealtyMogul has accepted just 1.1% of the more than 30,000 applications received from real estate projects.
- All the information required to carry out due diligence yourself is available on the property listing.
- All fees associated with investment are displayed on the property listing.
- Investors can do everything from find a property through to signing the legal documents and finalizing the deal, all from the RealtyMogul dashboard.
- Extensive educational resources and an expert investor relations team empower members to make fully informed decisions before they put their money into a deal.
Frequently Asked Questions
Who is eligible to invest through RealtyMogul?
To access private investment opportunities like the ones RealtyMogul lists on its platform, you have to be an accredited investor. The guidelines for this are set by the SEC. Currently, you need to either have over $1 million in net worth (not counting your own home) or a gross income of $200,000 or more per year for the last two years. If you’re investing jointly with your spouse, you should be earning $300,000 gross per year. RealtyMogul will ask you to provide proof of this when you sign up for the site.
To invest in their REITs or other products, you don’t need to be accredited. However, you won’t be able to invest more than 10% of your annual income or net worth (whichever is higher).
How does an investment opportunity get listed on RealtyMogul?
The platform receives an application from a real estate project. They then vet that project through their due diligence process, focusing on both the sponsor and the property itself. Before approval, a RealtyMogul representative visits each individual property to confirm location, condition, and other basic characteristics. If the project passes this due diligence process, it gets listed on the platform.