DiversyFund offers automated real estate investing for those with at least $500.
DiversyFund; Alyssa Powell/Business Insider
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Bottom Line: DiversyFund is best for investors who don’t mind waiting five years to see their investments grow. The company manages everything for you, so it’s not the best option for DIY investors who prefer active trading.
FeatureInsider rating (out of 5)Fees5.00Investment selection3.00Platform navigability5.00Customer service4.00Trustworthiness5.00Educational resources/research3.75Overall score4.29
Is DiversyFund right for you?
Editor’s rating4.29 out of 5Fees0%Account minimum$500PromotionNone at this time.DiversyFund
Launched in 2014, DiversyFund is an online real estate investing platform offering private commercial real estate investments to nonaccredited investors (or people with less than $1 million to invest). While some platforms let you trade on your own, DiversyFund is completely automated.
The company says it aims to serve everyday investors who don’t have millions of dollars to invest but want to build wealth in meaningful ways.
DiversyFund also strives to maximize investment returns by requiring each investor to stick to a minimum term of five-years. Once you set up your account, you won’t be able to make early withdrawals, so be prepared to let your money sit for at least five years.
DiversyFund prosDiversyFund cons$500 minimum investment No management feesAutomated real-estate investment managementAvailable to non-accredited investorsLimited investment selection; only offers one REITs with assets in three statesMust hold investments for at least five yearsNo IRAs Can’t withdraw your investments’ earnings until the real estate assets, or properties, are sold
Not sure if DiversyFund is right for you? Keep reading to see how it stacks up against similar investment platforms.
How does DiversyFund compare?
$5,000 – $10,000
1% (additional $125 for IRAs)
1% to 2% for Prism Fund; other investments start at 0%
Real estate investment trusts (REITs)
Electronic real estate investment trusts (REITs), electronic real estate funds, and Fundrise IPOs
Multi-asset class funds, alternative investments, and short-term notes
Like DiversyFund, Fundrise offers real estate investments both for accredited and non-accredited investors. While both real estate platforms have $500 minimums, they differ when it comes to fees and investment options.
You can only invest in REITs with DiversyFund, but Fundrise’s investment options also include electronic real estate funds, Fundrise IPOs, and self-directed IRAs. Yieldstreet, on the other hand, offers mult-asset class funds, alternative investments, and short-term notes.
If you’re set on REIT-focused automated investment management, though, keep reading to see if DiversyFund is right for you.
Ways to invest with DiversyFund
DiversyFund is best for passive investors looking to get into the private commercial real estate market without paying high account minimums or management fees. The company primarily offers its own real estate investment trust (REIT), and it makes these available to everyone, not just accredited investors (individuals who have a net worth of at least $1 million or annual income of $200,000).
A REIT is a company that owns and manages income-generating real estate assets. In other words, when you invest in REITs, you’re investing in multiple real estate projects.
In some cases, REITs own different types of real estate assets like hotels, rental units, or retail centers. However, DiversyFund’s Growth REIT mainly owns multifamily properties. This means that your $500 deposit grants you access to all of the real estate projects, or multifamily properties, that DiversyFund currently owns.
Since it owns all of the real estate assets it offers, DiversyFund manages each real estate project from start to finish and profits off of those projects alongside you. Plus, it says it offers each investor 7% preferred return. This means that the company doesn’t profit off of real estate projects until investors receive 100% of returns up to the first 7%.
And although you’ll need $500 to get started, DiversyFund’s investment minimum is relatively low compared to other real estate apps like CrowdStreet ($25,000) and Yieldstreet ($1,000 to $10,000).
Keep in mind, though, that since DiversyFund’s Growth REIT is a public, non-traded real estate investment, you won’t be able to withdraw your investments’ earnings until the real estate assets, or properties, are sold. This is because the company reinvests dividends and earnings until it sells the real estate assets.
DiversyFund currently owns properties in California, North Carolina, and Texas.
DiversyFund also offers a learning center that contains a variety of educational blogs on investing, business, news, personal finance topics, and more. The platform currently provides posts on the following:
You can also sign up to receive investment updates and articles by email.
Is DiversyFund trustworthy?
DiversyFund currently has an A+ rating with the Better Business Bureau. This is the highest rating a company can receive, and it generally suggests that it excels in its business practices and customer interaction.
The BBB considers several factors when assigning ratings to companies. These include the company’s complaint history, type of business, time in business, licensing and government actions, advertising issues, and more.
DiversyFund’s record is clean of any major lawsuits. The company has closed seven complaints in the last three years.
REITs: These are companies that own income-generated real estate assets. You can buy shares of publicly traded REITs through online brokerages and other investment platforms.Accredited investor: An individual who either has earned above $200,000 in the prior two years ($300,000 for spouse or spousal equivalent), or someone who has a net worth of at least $1 million.Alternative investments: These are assets that deviate from traditional securities such as stocks, ETFs, bonds, and mutual funds. Common examples include real estate, art, hedge funds, master limited partnerships, private equity, and precious metals such as gold.Illiquid: Something is illiquid when it can’t be easily converted to cash. An illiquid asset could represent property or other tangible investments.Related Content Module: More Investing Coverage