What Is EquityMultiple?
Launched in 2015, EquityMultiple is a real estate investing platform that offers investors access to professionally managed portfolios and self-directed investing tools. Headquartered in New York, EquityMultiple covers many property types and risk profiles, making it an ideal platform for investors seeking exposure to the real estate market.
EquityMultiple is available for accredited investors only and, as of 2023, has a total project value of $4.4 billion. Since its inception, EquityMultiple has paid out more than $298 million in distributions to investors and averages 17% in annualized returns across all their investment options.
In this quick EquityMultiple summary, I will go over all the best features of this platform. If you want to read a more in-depth analysis, check out our full EquityMultiple review.
Pros & Cons of EquityMultiple
Pros
1. 17% average annualized returns
2. Choose from three investing strategies with different risk profiles
3. Gain exposure to a low-volatility asset class
4. Specialized focus on multi-family properties
5. Invest in diversified funds for real estate properties
6. Compatible with IRA and SDIRA
Cons
1. $5,000 minimum investment
2. Only accredited investors can participate
Choose From Three Investing Strategies
EquityMultiple offers three crowdfunding strategies to choose from based on different risk profiles. EquityMultiple is an excellent entry-level platform for beginners and one of our top recommendations in our best real estate crowdfunding platform reviews. With EquityMultiple, you can choose from three main strategies: keep, earn, and grow. Here’s a quick breakdown of each:
EquityMultiple Keep offers the lowest risk and shortest terms. With EquityMultiple Keep, you can invest in debt securities, also known as notes. Notes have the lowest minimum investment out of all EquityMultiple investing options, starting at $5,000, and terms are shorter than six months. The annualized yield for notes is 6.5%.
With EquityMultiple Earn, you can invest directly in senior debt, preferred equity, and yield-focused diversified funds. Terms and yields are higher than notes, starting at 6+ months, with target returns of 8–12% for senior debt and 10–14% for preferred equity. The minimum investment for EquityMultiple Earn is $25,000 – if you can afford it, we recommend it over EquityMultiple Keep.
Finally, EquityMultiple Growth includes value-added and opportunistic investments with the highest yield and a target IRR of $18%+. This portfolio is for you if you want long-term, growth-focused real estate investments. The minimum investment to participate in these is $25,000.
EquityMultiple Historical Returns
Since its launch in 2015, EquityMultiple has paid out more than $298 million in distributions to investors, with a total project value of $4.4 billion. The expected returns will largely depend on your risk profile; for safer investments, the expected annualized yield is $6.5%, compared to 18%+ for growth-focused investments.
Real estate has historically shown excellent performance, and best of all is that it has a very low correlation with stocks and bonds, – that means it can be a great addition to any portfolio and is guaranteed to make your portfolio more resilient against any market fluctuation.
For all investments, EquityMultiple uses a nationwide network of established real estate firms, proprietary algorithms, and a professional team of investors with decades of real estate experience – only 5% of properties pass this exhaustive research process and become available in the EquityMultiple marketplace.
Invest in Real Estate with a Self-Directed IRA
With EquityMutiple, you can invest in real estate using funds from an existing IRA or set up a new account with one of the SDIRA custodians listed below – the same tax benefits of regular IRA accounts apply to this type of real estate investment. Here are some of the custodians you can use:
1. Millennium Trust Company
2. Provident Trust Company
3. IRA Services Trust
4. STRATA Trust Company
5. PENSCO Trust Company
6. The Entrust Company
For the complete list, create an EquityMultiple account and navigate to the IRA Custodians section. Keep in mind that you may need to provide additional documentation, and for joint funds and trusts, all members must be accredited investors.
Here are some other exclusive investment opportunities for accredited investors.
How Are Your Investments With EquityMultiple Secured?
In the case of debt securities and preferred equity, EquityMultiple offerings are secured by the underlying real estate, an interest in the entity owning the property, or priority payments, in the case of preferred equity. That means that in the unlikely event of default, you’re first on the list for getting your investment back – What is crowdfunding real estate, and how does it work?
EquityMultiple Fees
1. Shared Equity: 0.5%-1.5% of invested capital
2. Debt & Preferred Equity: 1% servicing fee
3. Funds: Origination Fee
4. Administrative Fees: $30-$70/year
For funds, there’s an Origination Fee, which is different for each offering and is usually paid upfront. Administrative fees apply to all investments and cover tax documents, annual fillings, and entity formation.
Sign-Up Process
Anyone can register and sign up for an EquityMultiple account, but only US-based accredited investors can participate and make investments. If you’re a foreign national who owns an investing entity incorporated in the US, you may also be eligible to participate – contact the customer support reps at EquityMultiple for more details.
Signing up for EquityMultiple is very quick and won’t take more than a couple of minutes – here are the steps:
1. Visit EquityMultiple’s website
2. On the top right, click Sign Up
3. Fill in some of your basic information
If you use our link to sign up, you will qualify for a welcome bonus. Keep in mind this will depend on the current offer.
Final Thoughts
EquityMultiple is a crowdfunded real estate platform for accredited investors. It offers investment opportunities for all types of investors; whether you’re looking for low-risk investments or more profitable growth and opportunistic investments, EquityMultiple’s got something for you. Despite being open to accredited investors only, EquityMultiple has a very affordable minimum investment of just $5,000, making it one of the more flexible options for US-based investors. For this reason and its excellent customer support reps, we can’t recommend EquityMultiple enough.
