Jury's Out On Crowdfunding
We asked our readers last week if they thought crowdfunding was the future of real estate investment. A majority (57%) says no: "Too many unscrupulous people will ruin it," predicts one reader, while another says too much regulation won't allow it to have an impact. "The real winners are going to be the money managers who charge fees, not the individual investors," adds another. "Crowdfunded deals will be forced to overpay to win the deal." Many said crowdfunding could work as a new source of capital for smaller deals under $5M. "The real question is legitimacy of a crowdfunding syndicator in a bidding (and borrowing) process," says one respondent. "Will an institutional seller get comfortable that this type of buyer has the capital to execute? And a lender that they can asset manage effectively?"