There are lots of reasons to consider investing in farmland – the biggest one being, of course, that people always need to eat! Farmland investing is perhaps the most reliable type of all real estate investing for this very reason, but if you’re new to farmland investing, you might not be sure how to start building up your investment portfolio in this area.
Enter – AcreTrader.
AcreTrader is one of the few real estate investing platform options out there that focuses on farmland investing above all other types. In this AcreTrader review, we’ll tell you everything you need to know to get started, from what kind of minimum investment you need to whether it offers a significant return on your investment.
So, without anything further, let’s get started with this AcreTrader review!
What is AcreTrader?
AcreTrader is a crowdfunded real estate investing platform that, again, specializes in farmland investing.
It is open only to accredited investors, meaning you have to earn at least $200,00 each year or have a net worth of more than $1 million.
That said, many of the deals you’ll find on this real estate platform have a much lower minimum investment than what you’ll find on other commercial real estate investing platforms.
A low-risk platform, AcreTrader makes it possible for any accredited investor to get started with the major asset class of farmland.
Is AcreTrader Only for Accredited Investors?
Unfortunately, like many other real estate investing platforms, AcreTrader is only open to accredited investors.
How Long Has AcreTrader Been Around?
AcreTrader has been around only since May 2018. It was created and is currently headquartered in Fayetteville, AR. It is a small company with a little over a dozen employees.
Despite its small size and young age, AcreTrader is one of the best platforms to use if you want to get started investing in agricultural real estate.
How Do You Use AcreTrader?
To get started with AcreTrader, you’ll need to start by opening an account. This can easily be done online on the AcreTrader website. Then, you can begin shopping for the various investment opportunities listed on the platform.
All offerings are what’s known as “private placement” Regulation D investments. This just means, again, that you need to be an accredited investor.
The platform has an easy-to-use interface, and it just takes a few minutes to complete the process. You don’t even need to log in to your email – you can do everything in the app via DocuSign.
Is AcreTrader Safe?
AcreTrader is safe to use. When you buy your shares, the money will go into escrow at North Capital Private Securities Corporation, which is a registered broker-dealer and a member of SIPC and FINRA.
Therefore, you don’t have to worry about what will happen to your money if AcreTrader goes out of business.
What Does AcreTrader Cost?
You will also be charged an asset management fee. This also varies depending on the asset value. However, you can expect to pay around 0.75% to 1% per year based on the asset value.
AcreTrader also owns a real estate brokerage, so it earns commission when a property is bought and sold -that’s one other real estate fee to keep in mind when using this platform.
AcreTrader Customer Service
AcreTrader has some of the best customer service of all real estate investing apps, even despite its small size and young age.
You can get in touch with customer service during office hours, which are between 7 am and 6 pm. There’s someone there to answer the phone at virtually all times, plus a very responsive online help desk if you need answers, too.
AcreTrader Pros and Cons
Like all the other investment platforms out there, there are several pros and cons associated with making farmland investments with AcreTrader. Here are some highlights.
Pro: Highly Unique Asset Class
AcreTrader investors can tap into a truly one-of-a-kind asset class. Farmland has a phenomenal track record of minimal losses and strong returns, making it one of the best alternative investments you can make.
Pro: Reliable Service
Even if you aren’t familiar with the world of agriculture, you can invest in farmland with AcreTrader. The AcreTrader marketplace has all kinds of information you need to feel confident about your investment.
Despite being a relatively new company, the AcreTrader management spends a great deal of time, money, and resources vetting each deal. Only about 1% of all farms are actually selected for investment opportunities – you can rest assured that this farmland investing platform only presents the best of the best real estate for accredited investors to invest in.
Pro: Low Initial Investment Minimums and Low Overall Fees
Again, you don’t have to put down a lot of money in order to invest in farmland with AcreTrader. AcreTrader fees are quite low, too, especially compared to other investment platforms.
You can often participate in deals with an investment of less than $10,000, something that can’t be said about many other investing platforms out there.
Con: Must Be an Accredited Investor
The biggest disadvantage of AcreTrader is that there are some serious barriers to getting started. The biggest is that it is not open to non-accredited investors.
You have to be an accredited investor in order to tap into this secondary market. Because you have to earn at least $200,000 per year or have a net worth of more than $1 million, it’s difficult to start investing in farmland unless you’re incredibly wealthy.
There aren’t many platforms out there that do exactly what AcreTrader does. The next closest option is FarmTogether, a real estate investing platform that is quite similar to AcreTrader in its format and function.
FarmTogether is also open only to accredited investors. However, it has a minimum investment of $15,000 in most cases, as opposed to $10,000. That’s something for investors to consider – in addition, FarmTogether has a higher asset management fee. It does not have a secondary market to sell positions early, which FarmTogether does, nor does it have FarmTogether’s track record of success.
Of course, if you’re not sold 100% on farmland investing, there are other alternative investing platforms out there, too. One is Hedonova, which is a low minimum hedge fund that invests in a portfolio of alternative asset classes like wine, art, equipment finance, and more.
YieldStreet is another, offering a wide range of asset-backed debt investments with short hold times. It’s this latter part of the equation that might be most attractive to certain investors – farmland takes a while to show its value, so it isn’t always the best for short-term investing.
Is AcreTrader Worth It?
AcreTrader is a legit way to invest in farmland – and if you’re thinking about tapping into real estate brokerage and investing, it’s a smart way to go. It has received a significant amount of funding from a notable group of investors, and despite being a new platform with a limited track record of success, it’s clear that it’s on an upward swing.
Consider investing in AcreTrader or check out one of the other alternatives to AcreTrader instead. Whichever You choose, know that investing your money in farmland is a smart move for your future.
AcreTrader Review Ratings
- Ease of Use: 5
- Cost: 4
- Safety: 5
- Customer Service: 5