Investing in real estate is a hard decision even for the brave ones. Sometimes, this is not the problem, but rather the lack of sufficient funds to move you to this step.
Crowdfunding (or Group investing) is growing even more in the past years all over the world and people rely on it for future income. It all started in 1997, with the first crowdfunding platform which opened in 2000.
What is crowdfunding?
Crowdfunding is a new type of Investing in which you start to invest when you do not have enough equity to invest, but you still has funds that you want to make a profit with.
The good thing is that everyone can join in crowdfunding – from students to retired people and businessmen.
The groups are between 5-10 people who invest different amounts of money, depends on their current budget without this reflecting the others.
You can calculate together the amount everyone has given and how much the return profit will be.
When a property is purchased through group investing, someone may subsequently retreat or continue with the group, deciding to sell it over time or rent it out.
1. Starting with a small amount
The biggest advantage in crowdfunding for sure is the ability to invest even though you don’t have enough funds to do it on your own.
In group investing there is no minimum capital to invest, which benefits investing a certain amount of money that you currently have.
In Bulgaria, such an investment is not so popular yet, but in other countries, it is quite advanced and offers an opportunity for training with experienced people in the field who motivating the future investor with seminars and conferences.
3. You are not the only one responsible
Investing is an important decision that needs your attention and part of your time constantly.
Through group investing, tasks are not just your responsibilities and they are distributed among all group members equally, so that way there is no overload.
4. It’s for everyone
Everyone can join the group investing. It’s open for students, as well as parents, employees in each field, retirees, and businessmen.
Teamwork can be quite hard or sometimes almost impossible, especially when you need to deal with many different.
Sometimes you need to be in a group with many people you may not be comfortable with.
Emotionality can be overwhelming, as investing is a responsible process and requires focus.
Depending on the platform you choose to invest in, there may be a fee to become a member of an investment group. The fee sometimes turns people off, especially if it’s too high.
3. Take your investment back
Very often when you become a member of an investment group and you need to take the investment back, it can be hard or sometimes even impossible process.
Trusting your money on the platform, you need to know that it is difficult to return them back, even if you are in an emergency.
4. Law restrictions
Since group investing is a relatively new process, there are no law restrictions. The documents and contracts must be carefully read.
After all, a lot of platforms are trying to keep track of and limit false projects, but you need to keep in mind for eventually misuse.
Crowdfunding is a relatively new type of investment in Bulgaria.
It has many more benefits for people who do not have a big amount of money.
Investing this way be sure to explore for better platforms and get together with people close to your interests for easier collaboration.
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