Concreit Review – Is It Worth Using?
Getting into real estate investing isn’t an option that is typically open to everyone. Building a real estate portfolio typically requires a large amount of money to get started and may also require approval for a loan in many cases.
The Concreit App is looking to change that all up. Concreit is a real estate app designed to enable the everyday investor with the chance to get into the real estate game.
Skeptical of these claims? In this Concreit review, we’ll find out if this real estate investing app lives up to its goal so you can decide if it’s truly worth the download.
Ready to learn more? Let’s get started with this Concreit review!
What is Concreit?
Concreit is a real estate investing app that allows you to buy and sell shares of a private, non-traded real estate investment trust, or REIT. The trust invests in private loans that are backed by real estate and commercial property such as multi-family complexes.
Theoretically, a REIT’s value should increase over time as real estate values increase. The goal is to provide investors with weekly or monthly dividends.
You can start investing with as little as $1 into commercial real estate. This sector of the market has typically been where the wealthy have been the primary investors.
History of Concreit
Concreit was founded by the current CEO Sean Hsieh and Jordan Levy in 2018. The pair were co-founders in Flowroute, a telecom startup that they sold in 2018 to West Corp.
Hsieh and Levy’s next goal was to build a company that “could help everyday people become more financially secure.”
Hsieh is a second-generation immigrant who had grown up working in his family’s restaurant. This is where they shared the dream of using properties to achieve financial freedom.
Levy’s parents built a small construction business from scratch as he was growing up. The idea of earning passive income through single-family rental homes was disillusioned by the risk, overhead, and hassle of managing these properties.
They started to invest in commercial real estate after selling Flowroute.
Upon realizing that opening this asset class to everyday investors could help reduce the wealth inequality gap, they started Concreit.
Their goal was to design a mobile-first platform that would allow even small investors to reap the benefits of owning real estate “without the burden of making repairs at 2 a.m. on a Saturday.”
Why invest in Real Estate?
There are several reasons why you should add a real estate income to your investment strategy. REITs are total return investments.
Generally, they provide high dividends, and there is also the potential for moderate, long-term capital appreciation. When you look at the long-term total returns of REIT stocks, they are similar to those of value stocks and offer better returns than lower-risk bonds.
Real estate investments through the use of REITS offer benefits like:
- Long-term performance that is similar to those of stocks
- Stable and substantial dividend yields
- Portfolio diversification
- Real estate income potential
Truly, investing has many advantages that make it a valuable asset class to add to your portfolio. However, you should be aware that there is some risk.
Real Estate involves Risks
By investing in REITs, you could potentially earn weekly dividends and other benefits. It’s still important to remember that there are risks.
Real estate prices have risen and fallen in response to outside stimuli, market conditions, etc. Any weaknesses will be reflected in the prices.
There have also been periods where the long-term returns of a REIT have fallen substantially. For example, the real estate bubble that occurred from early 2007 and 2009.
Negative total returns can also happen during times when interest rates are rising or high.
Just like any investment opportunity, REITs can be risky. Be sure to balance your investment strategies to help mitigate some of these potential risks.
How does Concreit Work?
The investments offered by Concreit are pooled with investor funds and put into different projects like:
- Commercial real estate that’s focused on multi-family structures
- Private short-term loans that are used by real estate developers and builders
- Real estate-related securities; includes equity and debt securities for publicly traded and private companies
Concreit’s Investment Advisory Committee (IAC) reviews all these investments opportunities. Each investment opportunity must be approved prior to the capital being ejected.
Members of the Investment Advisory Committee include those who are real estate industry experts and experienced in commercial real estate credit, property, and fund management. You can be sure this professional management has the experience in operating real estate to make well-informed decisions.
Your investment objectives should include buying shares of these diversified real estate portfolios to increase their value over time.
With no investment minimums, you can get started with this potentially awesome real estate investment for as little as $1. Under normal circumstances, you may also get monthly or weekly dividend payments.
There’s no property taxes or tenants to deal with on a regular basis to generate this real estate income.
Concreit invests conservatively in an effort to minimize risk. They also allow you to invest in short-term returns and cash out fast. These are two things that make the investment app, Concreit unique from other real estate assets and platforms.
Who can use Concreit for Real Estate Investments?
To take advantage of the investment opportunity offered by Concreit, you don’t have to be an accredited investor. There are no minimum requirements to start investing.
You can start investing in real estate assets as long as you are over the age of 18 and a US resident or US citizen. This makes Concreit accessible to a large population of individuals.
Here’s a look at the key features that Concreit offers to users who wish to build a real estate portfolio.
- Minimum Investment – $1
- Annual Returns – 5% to 8%, 5% is the preferred return
- Account Fees – 1% annual lAUm
- Time Commitment – N/A
- Accredition Required – No requirement; Non-accredited investors limited to 10% of annual income
Most real estate investments require that you have a lot of capital to get started. The investment app Concreit makes real estate investing easy and allows everyday investors to generate money, build passive income, and get into commercial real estate assets.
Using their platform, you can buy shares of private REITs, which invest in private loans backed by real estate and fractional shares of multi-family properties. As long as you have at least $1 in your savings or checking accounts, you can get started.
Other features included with Concreit:
- A professional investment team, called the Investment Advisory Committee performs the due diligence
- Generate weekly dividends from passive income generated from rental income, property appreciation, and loan interest
- Auto invest feature that allows you to automatically invest monthly
- Mobile app that’s available on iOS and Android devices
- No minimum holding period. Their withdrawal program allows you to request withdrawals anytime there is fund availability in the pool
- Potential annual returns of 5% to 8% after fee deductions
- Receive important updates and announcements via push notifications
To keep your personal data safe, Concreit uses the same security level as banks when it comes to encryption. There are additional layers of biometric protection with Touch ID and Face ID access too.
There is no cost or membership fee to sign up with Concreit. You will pay a Monthly Assets Under Management (AUM) fee of 0.08%, which equates to 1% on an annual basis.
Additionally, there are withdrawal fees which include a redemption fee and a bank transfer fee (pass-through ACH fees). These fees will depend on how long you’ve had your money in Concreit’s professionally managed portfolio, as broken down below:
- Over a year – An ACH fee of 10 bps which is equivalent to 0.001%
- Less than a year – An ACH fee and a short-term redemption fee. Under the redemption program, the short-term redemption fee comes out to 20% of your net dividends, which leaves all your original principal shares.
Concreit Referral Program
Now let’s introduce Concreit’s referral program that has been launched recently. New members who sign up with Concreit are eligible for a $10 bonus in fee waivers. You must sign up via a referral link to be eligible.
Existing members have their own unique referral link, which allows them to earn $10 in bonus credit for every person that signs up to claim their welcome reward using it.
Each user can earn up to $500 in referral bonuses and up to $5,000 for life.
Concreit Pros and Cons
Pro: Allows Investors at all Levels to Get into Real Estate Investing
The everyday investor to the accredited investor can get into the game in an equal fashion. US real estate investments are typically only for the wealthy or well-connected investors.
You don’t have to worry about the hassles of direct ownership or your credit worthiness to be eligible for a loan.
Pro: Earn passive Real Estate Income
Through weekly dividends, users can earn money without having to lift a finger. The ability to make money, build passive income, and do it in a consistent manner is one of the greatest benefits of using Concreit.
Pro: Auto-Pilot your Investments
Since Concreit’s portfolios concentrate on data-driven decisions combined with a long-term outlook, you don’t need to constantly be monitoring your investments. The whole investment team at Concreit, who reviews all the investment opportunities, have gained management skills in this sector to be experts in their field.
Pro: No minimum Holding Period
Having a long-term investment balance is typically a good idea. However, situations happen, and you may need to dip into those assets for your money management needs.
Concreit doesn’t have a holding period, so you’re free to pull money out whenever you wish using their redemption program.
To withdraw your investment, simply put in a withdrawal request. Concreit will fund your request using cash they have on hand and income produced from their assets and loan repayments.
The waiting period for withdrawals is generally around one week. The only downside is that if there is high demand or Concreit is low on cash, keep in mind that withdrawals might be delayed.
Pro: Mobile App is User-Friendly
The app continuously has received high ratings on Google Play and Apple Stores. The information displayed in the app is clean and easy to use.
You have access to everything that you need, all from your phone. Its simple to schedule automatic investments, setting the amount and schedule of these investments through the app.
If you want to keep informed of important announcements, you can enable push notifications that will allow you to receive important updates and real-time announcements.
Pro: Minimum Investment is only $1
You can start generating real estate income with just $1 from a checking or savings account. Even on a tight budget, you can probably afford to buy real commercial real estate assets.
Pro: Low Risk Comparatively
Concreit doesn’t guarantee returns, and you could potentially lose all the money that you invest. After all, no one can predict the economic factors that may happen in the future.
The platform does invest in underlying real estate assets that are generally low-risk. This includes real estate debt from collateralized commercial loans and fixed-income residential real estate.
Con: Average Returns are Low
As of 10/1/2021, the annualized rate of return for Concreit is 5.47%. When you compare it to the stock market or public REITs, this is below the average returns you see in past performance.
The real estate income the fund generates is using a low-risk profile. That means during down times when you experience price volatility, you could be earning more, and in strong economic times when the stock market is up, you’re probably going to be earning less.
Keep these economic factors in mind when considering the type of returns to expect.
Con: No FDIC or SIPC Insurance
You’re susceptible to losing any money that you invest with Concreit. You don’t technically keep money in Concreit as you would with a checking or savings account because it links up to your bank account. Hence, not having FDIC insurance is not as important.
But the Securities Investor Protection Corporation (SIPC) is designed to protect securities and cash in your brokerage account of up to $500,000 if your brokerage fails.
With SIPC insurance, that means if Concreit goes under, you are susceptible to losing your investments.
Con: Very New to the Game
Concreit is a very new investment app. While the company’s real estate fund has been around for a couple of years, the app itself launched in September 2021.
They haven’t had the time to build trust and a solid reputation quite yet.
Con: Non Accredited Investors Limited to 10% of Annual Income
If you are gun-ho on generating real estate income and have a large percentage of your income available to invest, you probably won’t be able to with Concreit. That’s because the platform limits the investments to 10% of annual income to non-accredited investors.
So if your main real estate play is to dive as much of your income into an investment platform like Concreit, you might look at alternatives.
Con: Liquidity not Guaranteed Investments
Concreit is a liquidity not guaranteed investments platform, which means that the investments might not be liquid.
Con: Competitor Options Might be Better
Other investment app possibilities out there might be a better fit for some investors than Concrete. We’ll talk about some of these next.
Concreit is not the only platform that enables you to build real estate income. Below are a few others that you should consider when looking at options.
Targeting higher returns than Concreit, Fundrise builds funds with slightly higher risk profiles. Additionally, Fundrise doesn’t offer the liquidy that Concreit does. Investors should expect to hold their investments for five years at a minimum.
You can get invested with individual rental properties with Arrived Homes. You can’t build a diversified portfolio since they don’t offer other investments like income-oriented private loans.
That also means that there’s more risk. On the flip side, that means you could potentially earn higher returns than a REIT. You need to meet their minimum investment requirement, and if you want to diversify your portfolio, that requires even more money.
Just like Fundrise, you should also expect to hold your investments with Arrived Homes for at least five years.
Non-accredited investors who are looking to get into multi-million dollar properties have an option with DiversyFund. Their investment offerings include Growth REITs and IPOs.
Available in all 50 states, you can invest anywhere between $500 and $1 million.
DiversyFund offers individual, joint, trusts, retirement (self-directed IRA), and some entity accounts.
Concreit Review Ratings
Mobile App – 4.5/5
The Concreit app continuously gets solid ratings from both the Apple and Android stores. The number of new app bugs reported is low.
The mobile app has user-friendly, so it’s easy to get started by downloading the app on your device. It also takes advantage of your device’s security features like Face ID access to provide additional levels of protection.
Customer Service – 4/5
If you have general questions about using Concreit, they have an extensive knowledge base that you can use to answer those questions. Their website also has a chat box in which you can get additional support if you can’t find the answer to your question or need more help.
Additionally, you can call them at 206-607-6080. Concreit does not have its contact hours posted, but it appears they are not available on the weekends. You can leave them a message, however.
Lastly, you can email them at firstname.lastname@example.org.
Features – 4.5/5
Concreit is an entirely mobile experience. The platform allows users to take advantage of all the features it has to offer using the mobile app.
You can turn on your notifications to get important updates, link up a checking or savings account, and make automatic schedules for investing using your device. Concrete has made making real estate income very seamless.
Bottomline: Should You Use Concreit?
Getting into real estate investing for the average person is made possible by platforms like Concreit. It is a solid option to get into commercial properties.
It is also a safe bet because their portfolios get into less risky assets such as private money lending (real estate debt). As a result, if you look at a particular benchmark like the stock market, it’s going to underperform in good times. But during times of price volatility in the markets, Concreit can offer solid returns.