Benjamin Miller, CEO of Fundrise, claims that their program paves the way to a more accessible real estate investment. Gone are the days where only filthy rich individuals can partake in such business. “Our goal is to build a better financial system for the individual investor — one that is simpler, more reliable, lower cost and transparent,” Benjamin continued. Is there a truth about Benjamin claims regarding their program being simpler and transparent? Read the Fundrise review below to know the real scope.
Fundrise is a real estate investing service open for Any U.S. citizen (or permanent resident) currently residing in the U.S. who is over the age of 18. Normally, only accredited investors can invest in similar private real estate deals that Fundrise utilize. But since Fundrise is publicly available, it lifts the accreditation requirement. The deals are marketed by Fundrise as something that can “deliver superior risk-adjusted returns over time versus portfolio of publicly traded stocks.”
Unlike most of the courses I reviewed here, the program has its own phone application in the App store for Apple devices and in Google Play Store for Android. It also has a dedicated subreddit named after itself for relevant discussion, but it not’s quite active.
It’s real estate with a different twist to it but at the end of the day, it’s still tied to traditional real estate. If you’re a regular here at Suugly, you’ll know that this is a business model I don’t recommend especially during the pandemic. First thing to note is the similarity of its liquidity to real estate. This is actually worst here since it’s a self-imposed rule by Fundrise themselves. “We can hold your assets indefinitely” is just a red flag to me as they’re basically holding your OWN money hostage. Reviews that mention very slow processing of withdrawals (three months or longer) and still charging penalties despite the investment being five years or older is not reassuring too.
Since it’s also investing in real estate properties, your investment goes down too as real estate crashes. “If I’m going down, I’m taking you with me” vibes when real estate is not doing well. However, the increase in profit is not that significant when it’s the opposite of doom instead. Basically, the only edge here is being able to dabble in real estate industry without the need of five figure capital but that’s about it. This is also with a relatively higher investment advisory fee of 0.85% annually. In comparison, a lower cost option in Vanguard REIT is only charging 0.26% per year.
The most off-putting here is the number of complaints the program got in BBB. On my past reviews, nothing has ever past the 10-complaint mark, I think. For Fundrise, however, they got a whopping sixty complaints. I already mentioned the undesirable penalties earlier but what’s worst is people getting caught off-guard with such. Fundrise is not transparent at all and it shows. What’s worst is their track record to mislead people, as in reporting how profitable your investments as long as they’re holding your money. Come withdrawal time and they’ll keep like 95% of the profits to themselves. You’ll end up with either a pathetic return or a net loss even. I don’t know about you but I’m not fine with companies whose only concern is to only “make them more money.”
Given that they’re also notorious for cancelling liquidations and ability to withdraw, I rather put my money somewhere else. Mind you, they did this “locking your money for no apparent reason” thing during the pandemic – the time when it’s likely for people to need their money on hand. Well, technically there’s a reason for this according to Fundrise and it’s to protect themselves in times of economic uncertainty. But imagine getting told that you can’t get back your OWN money. No need to imagine apparently when you invest in Fundrise.
Overall, everything about this program seems terrible. Not only that I don’t recommend real estate (so is any related investment to such) as a business model to dive in currently, but the sleazy tactics that Fundrise keeps doing just doesn’t sit right with me. Your money is better spent elsewhere quite frankly, just skedaddle and don’t ever look back. Why settle for this when there’s other programs out there with better track record and better business model than this that still qualifies as a side hustle.