This Little-Known REIT Is Producing Double-Digit Returns In A Bear Market: How?

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Contributor, Benzinga
October 12, 2022
reit-investment-property

Is this privately traded real estate investment trust (REIT) the safest way to sidestep stock market volatility?

As homebuying screeches to a nationwide halt, The Fundrise Growth REIT looks like it could pay out 18% returns by end of 2022.

Here’s whats instantly attractive about this unique Real Estate Fund:

  1. Beating a vicious bear market by double digits
  2. Low barrier to entry for new investors
    (click here to stay updated on the Fundrise Growth REIT)

Investors are celebrating. And experts reveal the perfect storm that led to this lesser-known instrument becoming a cash cow for risk-averse folks who aren’t wary in this uncertain market.

Turns out inflation, high interest rates and an unstable stock market created a lucrative business for certain real estate funds. And if trends continue, this REIT in particular could be the dark horse of 2023.

Where Investors Flock To When Wall Street Fumbles 

During these uncertain bear markets, real estate remains a consistent option for cash flow. However, all portfolios are not created equal. And the way a fund diversifies can mean the difference between healthy returns and massive long-term income.

For investors that just invested in single and multifamily homes and new home construction, profits may be lean at the moment. But for those funds that turned their attention to a record-setting rental market and commercial office space, 2023 could carry on the windfall returns projected this year.

That’s where the Fundrise Growth eREIT is thriving. With 11.7% returns so far this year, Fundrise is still onboarding new investors as they position themselves for a 2023 that exploits a massive rental boom. 

And with its portfolio focused on high-growth markets the impressive returns seem to just be warming up.

How Economic Distress Led To Windfall Profits

Inflation and high interest rates put the brakes on homebuying. At least partially. But look closer and you’ll see that capital isn’t stagnant, it’s just shifting. And for a fund that’s leveraged its portfolio right, it can take advantage of massive economic and demographic trends that are set to boom for years to come. 

  • Economic distress drives demand for rentals.
  • Commercial office needs are on the rise.
  • Demographic shifts fuel home appreciation in key markets. 

What’s better, the fund is immune to the emotional volatility of Wall Street — that’s because its stock price is tied to the value of its assets, not investor sentiment. In simple terms, as properties continue to cash flow, investors continue to cash in.

As long as Fundrise maintains its low minimum investment for new investors, you’ll likely see its popularity explode in 2023.

When Funds Go Private For Higher Payouts

There’s a popular misconception that the best-performing REITs are publicly traded or exclusive to accredited investors. No. The Growth eREIT from Fundrise turns that misconception on its ear. 

It’s been pumping out double-digit returns for five straight years. And even through the turmoil of 2022, it has already produced 11.7% returns for its investors. That number is set to rise nicely by year’s end. Luckily, it’s opened the fund to any U.S.-based investor with a starting contribution of only $5,000.

5 Years of Double-Digit Returns: Predicted Rise in 2023

Screenshot-2022-10-10-133815
Source: Fundrise

Performance is what matters. And the steady performance of this fund is driving new investors to find out what Fundrise is all about. Annual returns on this fund for the past 5 years are as follows:

  • 2017 — 17%
  • 2018 — 14.4%
  • 2019 — 20%
  • 2020 — 12.8%
  • 2021 — 43%
  • 2022 — 11.7% YTD

If you’d put $10,000 into the Growth REIT in 2016, it would be worth over $28,000 today. That kind of performance is nothing to sneeze at. However, past performance is not an indicator of continued success. 

But if Growth eREIT continues on these trends, it could remain a better alternative to the high-stakes gambling of Wall Street at the moment.

→ Click here to qualify for a Fundrise account ←

This post contains sponsored advertising content. This content is for informational purposes only and not intended to be investing advice.

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