Up until recently, the real estate sector was exclusively accessible to wealthy or institutional investors. But thanks to real estate crowdfunding platforms, investing in this high-return industry is now accessible to any investor regardless of the amount of capital he is willing to invest. Although real estate crowdfunding in Europe, and in the Netherlands particularly, is still in its early stages when compared to other investment options, it has grown in popularity as a result of recent significant advancements, with many platforms operating across the continent and thousands of projects funded.
In this article, we’ll go over the most important factors to consider when looking for the best real estate crowdfunding platforms and present a list of some of the best real estate crowdfunding platforms for investors living in the Netherlands.
What is real estate crowdfunding?
Real estate crowdfunding is a technique used by developers to obtain cash and finance their projects from “the crowd,” whether for remodeling, construction, or simply rental management. Real estate crowdfunding platforms connect developers with potential investors, who may want to get exposure to real estate with a small amount of money and earn a good interest in return. Unlike direct property ownership, investors do not have to worry about property management or paperwork. They just invest, and the interest they earn is determined mostly by the project’s type.
About Real Estate Crowdfunding in the Netherlands
Crowdfunding has already become widespread in the real estate sector, with a market estimated at $10.78 billion in 2021. According to official statistics, the crowdfunding market grew from €14 million in 2012 to €417 million in 2020 in the Netherlands, and real estate crowdfunding was among the fastest growing markets in recent years. Many platforms provide investment opportunities in the Netherlands, while others allow Dutch investors to participate in real estate investment projects in other European countries.
When looking for the platform that best suits your needs, several factors should be examined. To create a portfolio with diversified real estate exposure, you might want to look for a platform that offers investment opportunities from multiple countries. On the other hand, if you plan to take your gains on a regular basis, you should look at the fee structure (particularly withdrawal fees). Furthermore, you may wish to pick a platform with a secondary market if you want to liquidate your holding easily. Finally, if you are a more risk-averse investor, you may want to look into the platform’s history and the default rate of its previous projects.
Best Real Estate Crowdfunding Platforms in the Netherlands
Based on our research, many real estate crowdfunding platforms in the Netherlands charge a management fee on the funds invested or do not offer a secondary market (which is popular among other European platforms). That’s why our list of the best real estate crowdfunding platforms in the Netherlands includes several European platforms that are also available for Dutch investors.
Crowdestate is one of the most well-known real estate investing platforms in Europe. The platform provides excellent diversification opportunities as its projects include various property types (residential, retail, office, and healthcare buildings) and are spread across Europe (Estonia, Finland, Latvia, Poland, Slovakia, Romania, Italy, and Portugal). Crowdestate was founded in 2014, and its projects include rental, development, and renovation, in addition to business financing. Even though they currently do not have investment opportunities in the Netherlands, almost 700 Dutch investors used the platform to invest in real estate across Europe.
SamenInGeld is a Dutch crowdfunding platform focusing on mortgage-backed real estate projects in the Netherlands. The term of the projects ranges between 1 and 10 years. It was founded in 2015.
Founded in 2015, Crowdrealestate is a crowdfunding platform for real estate projects in the Netherlands. The projects’ duration ranges between 3 and 120 months, and they include first or second right mortgages.
A new Dutch crowdfunding real estate platform, founded in 2019, offers projects across many European countries, like the Netherlands, Germany, the United Kingdom, and Belgium.
Based in Estonia, EstateGuru is a real estate crowdfunding platform that focuses primarily on short-term property-backed loans (the average loan term is 14 months). The real estate projects cover several European countries, such as Estonia, Lithuania, Germany, Latvia, Finland, Spain, Portugal, and Sweden. It was founded in 2014.
Bulkestate is an Estonian real estate crowdfunding platform founded in 2016, concentrating on the Latvian real estate market. The platform also offers a “group buying” feature, which lets investors directly buy a property at a considerable discount.
Features of real estate crowdfunding platforms
When considering real estate crowdfunding platforms, it is important to consider the platform’s main features, such as the minimum account balance, fees charged, secondary market availability, and auto investing.
- Fees: Unlike brokers in the Netherlands, which charge a fee or spread on each transaction, real estate crowdfunding platforms do not charge fees on lenders (people like you), they rather charge it on borrowers. Still, some platforms might put commissions on withdrawals, or impose a success fee whenever the return on investment is above a certain rate.
- Secondary market: Many platforms offer secondary markets where investors can sell their investments and exit their positions at any time. Some platforms charge a fee on transactions executed on the secondary market, so it is worth checking those fees before proceeding with the transaction.
- Auto-invest: Some platforms offer an auto-invest feature allowing investors to automatically invest available funds based on predetermined criteria.
Comparing features of the best real estate crowdfunding platforms in the Netherlands
|Platform||Account Minimum||Fees||Secondary Market||Auto-invest|
|Crowdestate||€100||No fees on deposit or withdrawal||Yes (subject to 2% fees)||Yes|
|SamenInGeld||€250||Management fees of 0.5% for the first year, and 0.25% thereafter||No||No|
|Crowdrealestate||€500||One time 0.9% brokerage fee||No||No|
|Max Crowdfund||€100||0.1% monthly administration fee||No||No|
|EstateGuru||€50||€1 per withdrawal, inactivity fee of 2.5€/monthly||Yes (subject to 2% fees)||Yes|
|Bulkestate||€50||No fees||Not available||Yes|
Each real estate crowdfunding platform publishes key metrics regarding the projects funded throughout the years. We recommend checking this statistics page as it indicates the platform’s efficiency in offering successful and profitable projects to investors. Some key metrics are presented in the table below, such as the number of investors, the number of projects funded, historical return, and the cumulative amount raised.
Comparing some metrics of the best real estate crowdfunding platforms available for Dutch investors
|Platform||Number of investors||Number of projects||Historical return||Cumulative amount raised|
|SamenInGeld||Not disclosed||360+||5.18%||€84 M+|
|Max Crowdfund||9K+||100+||8.94%||€35 M+|
Why is Crowdestate one of the best real estate crowdfunding platforms for Dutch investors?
Based on the above comparison tables, I believe Crowdestate is among the best real estate crowdfunding platforms for a Dutch investor looking for European real estate exposure. Here are a few reasons why I believe it has an advantage over other platforms and why I think you should consider it when looking for a suitable real estate crowdfunding platform:
- A rigorous due diligence process: Crowdestate chooses only the best investment opportunities to investors after conducting an extensive background check on projects’ information, business plans, and financial models.
- A low minimum balance required: With only €100, an investor can start investing from almost anywhere in the world.
- Secondary market available and active: 33.11% of investors are active in the marketplace. As such, whenever an investor needs to exit the market, he might be able to find a potential buyer faster.
- Diversified projects: The projects offered on the platform are well diversified geographically and across different types (residential, commercial, and business financing).
- Low fee structure: Unlike several real estate crowdfunding platforms, Crowdestate does not charge any commission on withdrawals. However, it charges a 2% commission on transactions conducted on the marketplace and a success fee (typically 20%) over the 8.00% hurdle rate per year.
- Auto-invest: Crowdestate allows investors to automatically invest the funds available in their account according to specific parameters such as investment amount, expected interest rate, investment term, type of investment and country.
Real estate crowdfunding is a relatively new investment vehicle in Europe and in the Netherlands particularly. Nonetheless, it has risen in popularity in recent years as new platforms have entered the market and are offering more diverse projects. It is a simple strategy to increase exposure to the real estate sector at a cheap cost (in some cases, without any cost). Furthermore, investors can begin investing with a small sum of money. On the downside, while some platforms provide secondary markets, real estate crowdfunding is less liquid than other investment options such as forex or stocks—both of which are available through well-known brokers, such as eToro or the US-based Robinhood and TD Ameritrade.
This article presents a few platforms we consider among the best real estate crowdfunding platforms available in the Netherlands. We encourage you to check their websites, read about the projects, and check the investment process before deciding where to invest.