About RealtyShares

Founded by Nav Athwal, RealtyShares is a crowdfunding website for real estate developments that claims to help you diversify your portfolio and invest in pre-screened and professionally managed residential, commercial, retail, and mixed-use projects. Not only does RealtyShares claim to help you purchase shares in private real estate investments, but the company also claims to help companies access a new source of funding to raise capital for their investments.

How Does RealtyShares Claim To Work?

By now, you’re almost certainly familiar with crowdfunding sites like Kickstarter, Indiegogo, GoFundMe, and Booster.com, which help people raise money for their business ventures and personal needs. Using these websites, all you have to do is list your project, and if other people are interested in helping you out, they can contribute as much money as they’re comfortable with.

Recently though, a new era of crowdfunding has entered the market with websites like RealtyShares, which claims to serve two primary purposes: 1) to help accredited investors invest in a variety of real estate projects, and 2) help companies fund their real estate projects without having to go through traditional banks or other large lenders.

Since coming online in late 2013, RealtyShares has garnered quite a lot of media attention, having been featured on the Wall Street Journal, Forbes, CNN Money, Business Times, and more, due in no small part to their claimed focus on helping individuals invest in real estate projects from their living rooms, and giving them everything they need to invest intelligently.

In short, RealtyShares acts as a centralized area where companies who need funds for their private real estate projects can meet with investors who are willing to purchase shares in these projects. And according to the company, they give you the ability to make real estate investments in 5 simple steps:

  1. Sign up for a RealtyShares account.
  2. Browse investments securely. If you find one you’re interested in, you’ll then be able to access a detailed page explaining the offering, including “financials, property information, legal and financial documents and investment manager bios.”
  3. Finalize your investment directly through the RealtyShares website. The company even claims all documents can be signed electronically using DocuSign and funds can be transferred via Balanced.
  4. Next, each investment comes with a specific funding goal that must be met before you officially own a share. While you’re waiting for this to occur, your money will be held in an FDIC insured escrow account. And if this goal isn’t reached, then 100% of your money will be refunded.
  5. All RealtyShares members have access to a personalized dashboard where you can monitor your investments and returns and manage your documents. You’ll also receive quarterly updates about the project via email, and tax documents are provided once per year.

You’ve worked diligently over the years to make smart investment decisions, and this new breed of real estate crowdfunding websites has piqued your interest, but you’re wondering if they’re ultimately worth your time, or are just a passing fad. After all, you invest carefully and aren’t in the habit of losing your hard-earned money.

But is RealtyShares a company that you can count on to help you make wise investment decisions? Consider the following:

You Have Options When it Comes to Real Estate Investing

First and foremost, if you’re thinking about using a real estate crowdfunding website, keep in mind that RealtyShares isn’t your only option, as other sites such as Fundrise, Realty Mogul, CrowdStreet, Collaperty, and many more are vying for your business.

With this said, according to RealtyShares’ CEO, the company differentiates itself from other real estate crowdfunding websites by offering lower fees, complete transparency, a seamless investment process, and access to a wider range of investment opportunities.

How Much Risk Are You Willing to Take On?

Next, like any other type of investment, real estate projects come with a certain level of risk, so you’re not guaranteed to make any money. In fact, in a worst-case scenario, you could end up losing your entire investment.

Also, remember that real estate investments are not liquid, which means that your money might be tied up for long periods of time. As such, you’ll need to thoroughly vet any investment you’re thinking about becoming involved with it.

RealtyShares’ Investor Guidelines

If you’re thinking about investing in a real estate project featured on RealtyShares, the most important thing you need to know is that you must be qualified as an Accredited Investor. According to the RealtyShares FAQ, this means you must be “a natural person with (1) a net worth or joint net worth with the person’s spouse exceeding $1 million, not including the value of the primary residence, and / or (2) annual income of $200,000 in each of the two most recent years, or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income in the current year.”

On top of this, you must have a minimum of $5,000 to contribute to a project, although some investments may go as low as $1,000. There is no maximum investment amount, and you can even qualify as a foreign investor.

RealtyShares’ Investment Options

If you qualify as an investor, you’ll have two options: Debt investment and equity investment.

Debt investment means that your contribution funds a loan for the company who’s responsible for the project, and depending on your level of investment, your portion of the money earned from monthly interest charges will be deposited into your account. On the other hand, an equity investment pays a percentage of cash flow from rent on a monthly basis, or on the profits if the project is sold.

Regardless of the type, each investment will come with its own ‘hold period,” which references the expected amount of time that will pass before investors recoup their money after a project has been paid off or sold. This information will be available on the project’s Investment Overview page, and can last anywhere from less than 6 months to more than 5 years.

RealtyShares’ Company Guidelines

According to the company’s website, RealtyShares only provides loans (e.g. debt investments) for 1-4 unit residential properties, and some commercial properties, such as apartment buildings. Specifically, the website’s FAQ states projects must be:

  • Cash-flowing/Value-Add equity investments in commercial and residential properties such as apartments, retail, office and pools of single family homes;
  • Equity investments in Fix & Flips located in high demand/low supply markets;
  • Loans secured by residential and commercial real estate.

On top of this, borrowers must have a minimum 650 credit score, a loan to purchase price of less than 80%, and an “estimated loan to after repair value (once the property is rehabbed) less than 65%.” As such, the RealtyShares will not work for construction or ground-up development projects.

On top of this, RealtyShares claims to closely screen all new projects prior to being listed, including background and credit checks, comps, projected returns, geography, property type and quality, investment structure, a knowledgeable team, and a proven track record.

Although RealtyShares doesn’t guarantee successful funding, the company claims that most projects listed are funded within 5-7 days. However, for any projects listed on RealtyShares, companies will not be able to advertise them elsewhere in order to remain in compliance with Regulation D Rule 506(b).

Finally, RealtyShares’ funding methods are claimed to help you focus on operating the investment instead of communicating with numerous investors, since all funds are pooled into a single LLC.

The Difference Between RealtyShares & REITs

When compared to REITs (Real Estate Investment Trusts), RealtyShares claims to give investors the ability to choose the specific type of property or groups of properties they’d like to invest in, whereas REITs traditionally only allow you to invest in specific asset classes or projects based on geography. In addition, RealtyShares claims to charge substantially lower fees than REITs (we’ll talk more about this in a moment).

What Are Other Investors Saying About RealtyShares?

RealtyShares, Inc. has only been in business since late 2013, and there were no individual reviews available online at the time of our research.

However, most professional reviews from large websites such as Forbes and TechCrunch seem to be favorable, not just for RealtyShares, but for the growth of the real estate crowdfunding industry in general.

RealtyShares Pricing

RealtyShares is free to sign up for an account, whether you’re an individual looking to invest or a company looking for funding. However, according to the company’s FAQ, they “will charge a fee to cover ongoing investor reporting and communications for the investment,” although the specific fee for each investment can vary, and will be outlined in the project’s operating agreement.

After a project has been funded, the money is pooled and moved into an individual LLC, which is the entity that will actually provide the loan or hold equity in the investment. As such, you will be a shareholder in this LLC.

Compared to many other real estate crowdfunding websites, RealtyShares accepts Bitcoin for investments, either through Coinbase or your Bitcoin Address, although distributions will be paid in US Dollars.

In order to ask questions about fees, payments, or anything else, you can contact RealtyShares’ customer service department at 866-202-2023.

Can RealtyShares Help You Wisely Diversify Your Investment Portfolio?

Chopping to the Point: Considering the fact that RealtyShares has received a fair amount of positive media attention, that the real estate crowdfunding industry is in a growth phase, and that there aren’t any negative online reviews for the company, they appear to be a solid choice for purchasing shares in real estate projects.

Have you invested in any projects through RealtyShares? If so, what was your experience? Tell us about it by writing your review!


Read 13 RealtyShares Customer Reviews and Complaints

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Average Customer Rating: 1.8
Rating Snapshot:
5 star: 2 4 star: 0 3 star: 1 2 star: 0 1 star:  10
Bottom Line: 23% would recommend it to a friend
Showing 1-11 of 13
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  • 2 out 2 people found this review helpful

    BAD EXPERIENCE, losing entire investment

    • Missouri,
    • Jul 2, 2019
    • Verified Reviewer

    I must share my bad experience with RealtyShares as well. I invested $25K in a debt offering in July , 2017 for 12 months at 9% per annum. This was for developing Checkers and Taco Johns franchises in Tennessee. The interest distribution didn't start until October 2017. Three interest payments were delayed and then the term extended by three months to December 2018. I am sorry to share that the principal was not returned in December 2018 when it was due and is still remains unpaid including no interest since December 2018 thru Date (June 2019). In the meantime, RealtyShares sent a message that they were closing doors. Now the RealtyShares says the franchise has declared bankruptcy and all investors will lose most of the funds invested. This has left a very bad taste in my mouth regarding crowdfunding. I believe RealtyShares was involved in this fraudulent deal and has now closed their doors claiming they have been taken over by "iintoo". IINTOO keeps sending me emails to register and invest on their platform...what a SCAM!

    Bottom Line: No, I would not recommend this to a friend

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  • 2 out 2 people found this review helpful

    Stay away

    • Rancho Cucamonga, CA,
    • Apr 18, 2019
    • Verified Reviewer

    I received good dividends for a few quarters and haven't received a dime in the last several quarters for a big investment. They don't even have a phone number to call. If you email, you get a standard worthless response. What kind of a company that is managing $400M not have a phone number? I feel so bad for introducing this crappy company to many of my friends and family.

    Shame on this company.

    Bottom Line: No, I would not recommend this to a friend

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  • 3 out 3 people found this review helpful

    Ripped off

    • Littleton, CO,
    • Mar 28, 2019
    • Verified Reviewer

    I bought into a RealtyShares investment a few years ago. I was paid interest monthly for a period of time. RealtyShares quit paying the interest monthly this past year and have not received a penny in the last 14 month. They won't take your phone call and when you email them they give you some story how a fund manager is taking it over. Stay away from these people; they are bad news and they are a total scam. I am reporting this to the SEC and the State Attorney Generals office immediately.

    STAY AWAY, believe me...

    Bottom Line: No, I would not recommend this to a friend

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  • 3 out 3 people found this review helpful

    Very slow in providing k-1

    • New Jersey,
    • Mar 18, 2019
    • Verified Reviewer

    Every year at tax season, I have to take the headache to beg the k-1 from RealtyShares. It is a horrible experience, especially considering the poor return of my investment. Last year, I finally got my k-1 on 4/13. It almost forced me to extend my tax filing. However, last year, I was still able to talk or email to a real person to push the release of k-1. This year, I found that the phone number is not working anymore. And, the email I sent to the company did not get any response. This is terrible. Please consider this if you are thinking to invest through RealtyShares.

    Bottom Line: No, I would not recommend this to a friend

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  • 7 out 7 people found this review helpful

    28% loan defaults within 12 months

    • Rhode Island,
    • Sep 26, 2018
    • Verified Reviewer

    After making 30+ investments with RealtyShares in the range of $15k to $20k each, I have experienced a 26% to 32% loan default since 2016 to present in September 2018. This has essentially diminished my investment return to a NET LOSS. Many of the properties do not pay out for 1+ years after RealtyShares accepts the funds from its investors and even investments that manage to pay monthly only manage to do so before they go into default. Also, RealtyShares has not been able to return any principle on the default properties to this date since they continue to extend deadlines further and further to these deadbeat borrowers they manage to find over and over. In all, I have not been happy with all the work and efforts I have put in, to find out RealtyShares is promoting loans to borrowers who go into default shortly after they are given investor funds.

    Bottom Line: No, I would not recommend this to a friend

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  • 8 out 8 people found this review helpful

    No follow-up when things go wrong!

    • California,
    • Aug 4, 2018
    • Verified Reviewer

    I did a small trial loan with them. Payments were timely at first, but now the borrower has not paid in two months. I've emailed RealtyShares repeatedly for an update, but they have no interest in following up.

    Bottom Line: No, I would not recommend this to a friend

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  • 6 out 6 people found this review helpful

    Delayed payments

    • New York City, NY,
    • Jun 8, 2018
    • Verified Reviewer

    RealtyShares is not on top of their loans. I had to email them multiple times about a foreclosure and the ACH payments are delayed very often for no given reason. Proceed with caution.

    Bottom Line: No, I would not recommend this to a friend

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  • 10 out 11 people found this review helpful

    Closest to a scam as you can get

    • Nevada,
    • Jun 1, 2018
    • Verified Reviewer

    Poor customer service, threatened to close my account, leaving me out of a large investment that I already funded. Did not guarantee my money back on account closure. The rationale was that apparently a step was skipped on account creation (no issue in funding the investment though).

    I had to spend money on an attorney to make sure our nest egg was safe, and I ended up losing overall.

    Not worth the headache.

    Bottom Line: No, I would not recommend this to a friend

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  • 9 out 11 people found this review helpful

    Total write-off? New England High Yield Portfolio VII.

    • Washington,
    • Mar 23, 2018
    • Verified Reviewer

    I invested a 5-figure sum with RealtyShares in a supposed high-yield project backed by Residential Real Estate. RealtyShares did not properly vet the sponsor nor did they properly secure the investment funds with actual real estate collateral. No interest payments have been made, and it looks like this could be a total loss.

    RealtyShares has communicated nothing other than this, "RealtyShares has hired a forensic accountant to help us thoroughly analyze the flow of funds from the investment to the payoffs. We are requesting additional books and records from the sponsor."

    I have had great success with other crowdfunding sites, but I would strongly recommend steering way clear of RealtyShares.

    Bottom Line: No, I would not recommend this to a friend

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  • 4 out 7 people found this review helpful
    Updated review

    Update

    • Honolulu, HI,
    • Jan 2, 2018
    • Verified Reviewer

    For the month of December, only 3 of my 7 investments made the monthly payment. One of the current "okay" investments hit a snag and may be going into foreclosure.

    Bottom Line: Yes, I would recommend this to a friend

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    • Previous review
    • Dec 27, 2017

    Be very careful

    I have been participating for about two years. Out of my 10 investments, 2 paid off on time, 1 paid off very early (wasting my time and effort), 2 had their payoff date extended, 2 are in bankruptcy and are not making payments and 3 are doing okay.

    Customer service is excellent. There is a wide variety of offerings. For the normal investor, Debt offerings are better than Equity.

    Bottom line: this is very risky. You have to trust that RealtyShares is doing good due diligence. You have to trust that RealtyShares will not pancake. Read all the documents carefully.

    (read moreread less...)

  • 7 out 12 people found this review helpful

    The e-trade for real estate

    • Dallas, TX,
    • Mar 31, 2017
    • Verified Reviewer

    Very positive experience. I've always wanted to invest in real estate, but there haven't been many great options. I was able to invest in 10 different investments (with as little as $5,000) and get exposure to diverse markets and product types.

    The user experience is simple, and everything is streamlined.

    Bottom Line: Yes, I would recommend this to a friend

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