Real estate crowdfunding is a cutting-edge way for entrepreneurs to raise money. The process involves reaching out to a large number of small investors rather than asking one to make a substantial investment. Everybody makes a tiny financial investment in real estate ventures. Despite the inherent risk associated with real estate crowdfunding, these investments can increase an investor's portfolio and yield competitive returns.
Global Real Estate Crowdfunding Market Driving Factors and Challenges
Drivers- Integration of Blockchain Technology- Blockchain technology has made real estate transactions faster and easier than before. The usage of the technology for tokenization and smart contract development is growing quickly. Real estate crowdfunding powered by blockchain encompasses a decentralized, regulated listing, property financing, and management platform. It reorganizes assets, purchase/sale contracts, rental agreements, and related services on the blockchain. Peer-to-peer financing for projects is streamlined and real estate requirements are reorganized thanks to blockchain technology, which makes it easy and secure for investors and owners to share funds and information. Technology reduces fraud and deception, facilitates the removal of middlemen, and facilitates the management of information. The blockchain-based platform for real estate crowdfunding also streamlines the process of investing and risk assessment. It is anticipated that these factors will support the growth of the worldwide real estate crowdfunding market during the forecast period.
Challenges- Potential investors may become discouraged from participating in subsequent crowdfunding campaigns due to the high percentage of campaigns that fall short of their funding targets. Crowdfunding investments, in contrast to traditional investments, are frequently unprotected by the law. Investors may become more susceptible to fraud and other financial hazards as a result. In addition, the market has grown more competitive due to crowdfunding's rising popularity, making it challenging for individual campaigns to stand out and get funding. Furthermore, even in the event that a campaign is successfully funded, delivery of the promised goods or services may present difficulties, which could harm the platform's reputation and the legitimacy of subsequent campaigns. This makes it one of the main things impeding the growth of the crowdfunding market.
Impact of COVID-19 on Global Real Estate Crowdfunding Market
The COVID-19 pandemic had both beneficial and negative effects on the real estate crowdfunding market. On the one hand, the economic uncertainty brought on by the pandemic made it harder for many people to contribute to crowdfunding campaigns. But the pandemic also led to a sharp rise in interest in crowdsourcing for pandemic-related causes, such as medical equipment and research, and for small businesses struggling to survive due to lockdowns and other restrictions. All things considered, the crowdfunding sector has shown to be resilient during the pandemic, with many platforms learning to live with the new normal and continuing to connect investors with worthy causes and projects.
Global Real Estate Crowdfunding Market Key Players:
The market study provides market data by competitive landscape, revenue analysis, market segments and detailed analysis of key market players such as; DiversyFund, Inc., Crowdestate AS, Groundbreaker Technologies, Inc., Groundfloor Finance Inc., CrowdStreet, Inc., Fundrise, LLC, RealCrowd, Inc., EstateGuru OÜ, RM Technologies LLC., AHP Servicing LLC.
Global Real Estate Crowdfunding Market Segmentation:
By Investors: Based on the Investors, Global Real Estate Crowdfunding Market is segmented as; Institutional, Individual.
By Model: Based on the Model, Global Real Estate Crowdfunding Market is segmented as; Equity, Lending.
By Sector: Based on the Sector, Global Real Estate Crowdfunding Market is segmented as; Commercial & Industrial, Residential.
By Region: This research also includes data for North America, Asia-Pacific, Latin America, Middle East & Africa and Europe.
This study also encompasses various drivers and restraining factors of this market for the forecast period. Various growth opportunities are also discussed in the report.