- Diversyfund Services and Features
- Diversyfund Performance
- Diversyfund Pricing and Fees
- How Does Diversyfund Compare to Other Services?
- Is Diversyfund Trustworthy?
- What Are the Risks Associated With Diversyfund?
- Who is Diversyfund Best For?
- Final Verdict: Diversyfund
Real estate investing is a powerful way to build wealth because it enables owners to generate rental income, reach their investment goals, and benefit from capital appreciation as property values increase.
Traditional real estate investment can be tricky for prospective investors because it takes a lot of capital, either debt or equity, to purchase a building, renovate it, and manage depending on your goals. Most large real estate investment options are limited to accredited investors who have a higher net worth.
Real estate investment trusts (REITs) are popular vehicles for investors who want a more liquid method to invest in real estate and a tool for generating income and are a great introduction to alternative investments. If a REIT is publicly traded on an exchange, anyone with a brokerage account can buy and sell shares while enjoying any dividend payouts.
But what if you want a bigger stake in commercial property but don’t know where to start investing in real estate?
Diversyfund is attacking this issue head-on with their public non-traded REIT, which requires a low minimum investment for everyday investors who are comfortable locking away their cash for at least three to five years.
In this Diversyfund review, we’ll discuss what this platform offers, how it compares to its peers, and ultimately decide if Diversyfund is right for your portfolio. Ready? Let’s get started!
Diversyfund Services and Features
Diversyfund investments sets itself apart by offering access to a public, non-traded REIT to everyone, not just accredited investors.
The fund operates similarly to closed-end private-equity funds, where the investors commit to investing their capital for a three-year minimum so the fund can purchase, renovate, manage, and ultimately sell the properties.
The Diversyfund Growth REIT is currently comprised of multi-family properties (apartment complexes) with a minimum of 100 units spread out across North Carolina, Texas, and California.
Each portfolio property held by the Diversyfund REIT is a value-add real estate development opportunity. This means Diversyfund is responsible for renovating and managing all investment properties so their value grows and they can achieve the benchmark returns when they sell them.
Investing in real estate through Diversyfund is simple and automated. Once you create an online account, they will manage your funds and allocate them to the different properties depending on how much capital you contributed.
Real estate funds generally measure returns by using a metric called Internal Rate of Return (IRR) because it details how the fund is growing if you were to sell the portfolio at any given moment.
Diversyfund’s Growth REIT seeks to generate an IRR between 10%-20% for each property in their portfolio over a 5-year horizon.
Real estate investors sometimes receive a preferred return, which means that they receive a guaranteed payment after a property is sold before the fund can take any remaining profits.
Diversyfund offers a 7% preferred return before they can receive any remaining profits (if there are any.)
If there are profits, there is a 65% split that the investors receive and a 35% split that Diversyfund gets.
If the average annual return is above 12%, then the profit splits shift to 50/50.
It’s important to remember that investors will be paid only after a property is sold, and they do not expect to sell any of their portfolio buildings before 2023.
Diversyfund Pricing and Fees
There are no asset management fees for Diversyfund Growth REIT investors since they manage and develop their own properties. However, there may be developer fees ranging from 2% to 8%, depending on the multifamily real estate properties in the portfolio.
How Does Diversyfund Compare to Other Services?
Diversyfund is unique among other online real estate investment platforms because it does not charge an asset management fee and has an affordable initial investment.
Fundrise investments is one of the biggest names in online real estate investment because they offer low investment minimums and access to a wide variety of investments. While the Diversyfund Growth REIT only has multifamily properties, the Fundrise portfolio also provides residential real estate investments. They offer highly illiquid non-traded REITs like Diversyfund, but they also provide more liquid investments such as their Interval Fund, in case you may need access to your cash.
Diversyfund sets itself apart in the real estate crowdfunding industry because it is the property manager and developer, which cuts investor costs significantly.
Comparison to Other Investment Opportunities
Investing in real estate is unique because it requires patience and longer time horizons before investors see a return.
If you are interested in shorter-term investments, then you could look to the stock market, equity crowdfunding opportunities, or other alternative investments.
Regardless of your choice, it’s best to have a diversified investment portfolio so that potential investment returns in another offset your potential losses in one asset class that can include stocks, real estate, and alternative investments.
Is Diversyfund Trustworthy?
Diversyfund has an A+ rating and many positive reviews from investors and clients, which is a positive reflection of their trustworthiness as a real estate investing platform.
To maintain an honest and transparent business model, Diversyfund contracts an independent 3rd party auditor to audit their financial statements annually.
What Are the Risks Associated With Diversyfund?
Illiquid investments like the Diversyfund REIT carry the investment risk of accessing your cash very difficult if you need it in a pinch. Other risks include loss of capital, real-estate market risk, and other risks associated with a real estate investment.
Make sure you are able to live without your investment capital if you choose to invest in the Diversyfund Growth REIT.
Who is Diversyfund Best For?
New investors who want to learn more about vertically integrated real estate funds with low minimum investments threshold will enjoy an inside look at the market provided by Diversyfund. Since Diversyfund is the developer and property manager, their annual reports provide a wealth of information on how the fund is performing and how they are managing your capital.
Final Verdict: Diversyfund
Overall, Diversyfund is part of a new breed of crowdfunded real estate platforms that brings a new investment opportunity to nonaccredited investors. Most funds structured like Diversyfund require a much higher initial investment, and they usually require institutional and accredited investors to be involved with their capital raise.
If you want to invest money in a diversified portfolio and are curious about real estate investing, Diversyfund may be an excellent opportunity if you already have an investment portfolio and access to cash if you need it outside of your Diversyfund investment.
- Unique access to non-traded REIT for real estate investing
- Low fees and minimum investment
- Nonaccredited investors can invest in alternative assets
- Access for the average investor to earn dividend income
- New fund means limited investment options
- Hard to access cash if you need it for other investments
- More liquid real estate deals are available elsewhere
Ease of Use
Access to funds
Looking to invest in real estate? Diversyfund is a real estate investing platform designed to be simple and automated for the everyday user. This platform is designed for the everyday user, not just accredited investors. It offers access to a public, non-traded REIT as well as investment funds of high-value private market assets, like real estate, for everyday investors. Does this investing platform have what you need? Find out in our thorough Diversyfund review!