Crowdfunding democratizes access to real estate by allowing individuals to pool their resources and collectively invest in high-value properties.
Whether you're a seasoned investor looking to diversify your portfolio or a newcomer eager to give real estate investment a try, crowdfunding offers a unique opportunity.
Real estate crowdfunding in Canada is when a group of individuals pool their money together to invest in real estate properties that they would otherwise not be able to afford if they had to invest on their own.
This way of investing gives smaller investors the chance to participate in larger real estate deals that would potentially cost millions of dollars. By leveraging the collective funds of multiple investors, online crowdfunding platforms can make it easier for Canadians of more modest means to build wealth by investing in residential, commercial and industrial properties across the country.
It’s important to note that the amount you earn from your investment is entirely contingent on how much you put in — your profits are based on what percentage you invested.
Best real estate crowdfunding platforms in Canada
Despite the fact that crowdfunding for real estate is a relatively novel idea in Canada, several real estate crowdfunding platforms have started operations in the country over the last few years, including:
Addy invest
- Minimum investment: $1
- Management fees: Annual membership fee of $25.
- Current promotion:
Addy Invest democratizes real estate by allowing you to invest in properties with as little as $1. Designed for both accredited and non-accredited investors, the platform caps individual investments at $1,500 per property, ensuring opportunities remain accessible to a wide audience. With no transaction or management fees beyond a $25 annual membership, Addy makes real estate investing affordable and hassle-free.
However, the low investment cap limits potential returns, and the number of available projects is relatively small. While it’s a great way to get started in real estate and diversify without a large upfront cost, Addy is best suited for those looking to explore the market rather than make it a cornerstone of their portfolio. If you want an easy, low-cost way to dip your toes into real estate, Addy is worth considering.
BuyProperly
- Minimum investment: $2,500
- Management fees:
- Current promotion:
BuyProperly makes real estate investing simple and accessible by offering fractional ownership in properties across Canada and the U.S. With a minimum investment of $2,500, you can earn rental income and benefit from property appreciation without the burden of becoming a landlord. The platform’s geographical diversification and streamlined process make it a great option for those looking to dip into real estate without managing properties themselves.
However, BuyProperly’s investment options are limited, and the higher minimum investment may not suit beginners or those with smaller budgets. Real estate investments carry risks, including potential illiquidity and market fluctuations. If you’re ready to diversify your portfolio and seek passive income through fractional property ownership, BuyProperly could be a straightforward, low-effort way to start building your real estate assets.
Fundscraper
- Minimum investment: $5,000
- Fees: Trading fees range from 0.5% to 2%
- Eligibility: Open to both accredit and non-accredited investors
Fundscraper is a Toronto-based platform that opens the door to private real estate investments like REITs and mortgage investment corporations. With a minimum investment of $5,000, you can diversify your portfolio with curated opportunities, including those eligible for registered accounts like TFSAs and RRSPs. Fundscraper’s strength lies in its range of offerings and built-in due diligence, providing you with access to quality real estate deals without the need for hands-on management.
That said, Fundscraper isn’t for everyone. Its higher minimum investment may deter smaller investors, and the lack of early redemption options means your money could be tied up longer than expected. While the platform’s trading fees are competitive, they still range from 0.5% to 2%. If you’re a serious investor seeking a gateway to private real estate opportunities with the potential for steady returns, Fundscraper could be the right fit—provided you’re comfortable with the commitment and risk involved.
Willow
- Minimum investment: $100
- Fees:
- 1% property acquisition fee
- 2% annual asset management fee
- 5% monthly property management fee
Willow is Canada’s first real estate exchange, offering a groundbreaking way to invest in properties with as little as $100. Through its PropSharing model, Willow allows you to buy fractional shares in income-generating properties and trade them for liquidity, earning rental income and capital appreciation without the headaches of being a landlord. With reduced fees and a user-friendly platform featuring detailed analytics, Willow makes real estate investing more accessible and hassle-free, empowering Canadians to build wealth at their own pace.
However, real estate crowdfunding isn’t risk-free. Investments may be illiquid, and there’s no guarantee of returns or property value increases. Willow’s platform is still growing, which may limit available opportunities compared to traditional markets. If you’re ready to embrace this innovative, low-barrier approach and understand the potential risks, Willow could be your gateway to real estate investing without the steep financial and logistical hurdles of homeownership.
Is crowdfunding legal in Canada?
Yes, crowdfunding, including real estate crowdfunding, is legal in Canada and is regulated by the Canadian Securities Administrators (CSA). The CSA oversees crowdfunding platforms to ensure compliance with securities laws, protecting investors and maintaining the integrity of the investment market. While crowdfunding presents an exciting opportunity to access new investment options, strict regulations govern how it operates.
To ensure only legitimate platforms offer investment opportunities, non-registered and non-licensed platforms are prohibited from operating in Canada.
Under National Instrument (NI) 45-110 (September 2021), companies can raise up to $1.5 million within a 12-month period through registered crowdfunding platforms. Individual investors are generally limited to investing $2,500 per offering, but this cap can increase to $10,000 if a registered dealer determines the investment is suitable for the investor. Additionally, crowdfunding portals must specify a minimum funding target for each project; if this threshold isn't met, all funds must be returned to investors.
What do real estate crowdfunding platforms do?
Real estate crowdfunding platforms essentially work as intermediaries between investors and property investment opportunities. They research investment opportunities, select viable properties, recruiting investors and manage all the investments.
Pros and cons of real estate crowdfunding
Pros
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Accessibility: Crowdfunding allows investors with modest means to invest in property. By pooling resources online, individuals can participate in real estate projects that typically require substantial capital and were formerly only available to wealthy Canadians
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Diversification: Investing in property is a good way to diversify your portfolio
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Less management: Platforms handle property management and legalities, so you don’t have to know a lot about property management — which means you can be a passive investor
Cons
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Potential high risk: This type of investing and platforms are new to Canada and are not yet well established, so it could be risky to invest your money
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Due diligence: Investors must carefully research and select projects
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Limited selection: Not yet a lot of companies offering this type of investment so your choices of platform is limited.
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Limitations: Strict regulations can limit opportunities and ease of investment
Is real estate crowdfunding worth it?
Real estate crowdfunding is risky and is not easily accessible in Canada yet due to the scarcity of funding platforms. It’s really up to the potential investor to decide if they feel comfortable investing in this relatively new and not-yet-popular form of investing. Here’s a look at the pros and cons of crowdfunding real estate in Canada.
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Sandra MacGregor has been writing about finance and travel for nearly a decade. Her work has appeared in a variety of publications like the New York Times, the UK Telegraph, the Washington Post, Forbes.com and the Toronto Star.
Tyler Wade has worked in personal finance for over 5 years writing for brands like Ratehub, Forbes, KOHO, and now Money.ca.
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