As some of you may remember, I made my first investment on the Fundrise platform in April and I wrote an article about it then. I want to provide an update on my experience with the platform. I also want to share the returns my investment has generated in the 7 months since my initial $5000 investment. Keep in mind that investing is supposed to be inherently for the long term. I am not planning on any withdrawals here. As a matter of fact, I’ve recently increased my commitment to the platform.
Another personal finance blog that I read from time to time – The Financial Samurai also recommends this platform.
Reasons I like Fundrise even more
- The Transparency
- Every time the portfolio acquired a new investment, I was notified with an explanation of how it fit into the overall strategy.
- The reasoning of the acquisition was simple and easy to understand.
- The Macroeconomic Relevance
- The rationale fit into larger macroeconomic trends. The world is changing and it is comforting to know that your investments benefit from the trend.
- Their primary strategy to invest in affordable single family properties in the sunbelt align with the migration trends driven by the pandemic.
- The Diversification
- While my $5000 investment was distributed among 18 investment projects when I started, now it has grown to 51 projects. This mitigates risk and that is a good thing.
- As a matter of fact, this number will continue to grow since the fund is still ramping up.
- An Improved Redemption Policy
- When I signed up, the redemption requirements and penalties were complicated. 3% between Year 0 and 3, 2% between year 3 and 4 and 1% between year 4 and 5. This has been simplified to be 1% flat penalty for withdrawing before the 5 year mark.
- I love this simplicity and you will too if you like to balance your liquidity risk like I do.
- The Returns
- Overall, Fundrise has delivered great results. Dividend payments and appreciation combined, 16.64% in 7 months.
- Granted, this is also the strongest real estate market in a long time. I don’t expect this to be a trend but it is great to be able to participate in it with a small investment nonetheless.
Overall, I’ve liked the Fundrise platform so much, that I have added to my initial investment and upgraded my account to the Advanced Level that allows me access to even more funds than before. My hope is that some of the advanced strategies will create more diversification and opportunity for outsized returns.
If you decide to sign up, use my personal invite link to sign up and you will get 90 days of your investing fees waived.