How To Make Money With Fundrise In 2023

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Fundrise has become one of the most well known and trusted crowdfunded real estate investing platforms.

Investors from all over the United States are able to pool money together for private real estate investment. With a minimum of $10 to get started, this investment is very accessible to most people.

However, you might be wondering how you get paid back or earn money from Fundrise. 

There's primarily two ways to earn money investing with Fundrise:

1. Asset Appreciation - The value of the real estate owned goes up over time, usually a few years.
2. Distributions - Dividends paid out on a quarterly basis representing an investors share of interest and rent payments collected.

We will be exploring both with more detail!

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1. Asset Appreciation (Real Estate Price Growth)

With Fundrise, all the investors pool their money together to purchase real estate within a portfolio.

In particular, Fundrise looks for properties with a high potential of growing in value. This is usually based on the local real estate market that property is located in.

They will also usually make improvements on properties, which can further add to this overall appreciation.

• Let's say they buy a building for $800,000 and do $200,000 worth of improvements.
• Years later, they sell it for $1,500,000 based on the local housing market doing well.
• That means the profit before fees is $500,000.

Profits earned from the sale are distributed among investors.

Keep in mind, this money is only earned when a property is eventually sold. That is why Fundrise is considered to be a longer term 5+ year investment. 

2. Distributions (Rent/Debt Interest Payments Paid Out)

While most of the money is going to be made from the eventual sale of real estate owned, you can also earn money through rent/interest payments.

Currently, every investment offering from Fundrise pays out dividends on a quarterly basis. However, there are some portfolios that are more focused on growth vs income.

• A growth oriented portfolio will focus mostly on asset appreciation. 
• An income oriented portfolio will focus mostly on cash flow/dividends.

Depending on where you are at in your life financially, you may choose one over the other based on your goals.

Nonetheless, these dividends earned can either be reinvested automatically or paid out directly to your bank account. The benefit to reinvesting is this allows you to earn compound interest.