Crowdfunding is the process of raising funds from a large group of people to finance a project, a start-up business or a campaign, usually through the Internet. This method of pooling small sums of money for an expensive goal seems to extend to investments that require significant capital, especially real estate.
At present, crowdfunding in real estate has become popular in the United States, thanks in part to new legislation allowing online fundraising. There are many companies like UPRETS that provide you with crowdfunding facility.
However, different laws in Asia hinder the growth of these new investment platforms. Although crowdfunding is still in its infancy, it could be the next big hit in the Asian property market for a number of reasons.
If you really think about it, property ownership has been a reality for decades all over the world. The only difference is that by using the Internet as a distribution channel, the process is made less bureaucratic and more costly by eliminating fees, multiple intermediaries and complexity.
Small developers will also benefit from increased crowdfunding. Banks are generally reluctant to loan developers between US $ 1 million and US $ 10 million because their fees are not worth the extra paperwork. SMEs would have an alternative to bank financing.
Crowdfunding will also make the real estate market more accessible to investors by giving them the opportunity to purchase a portion of an apartment, office building or retail store: types of real estate generally offering rental yield higher than that of a residential unit, but at a prohibitive cost for most individuals. .