Investing in real estate is hot. These days the ads fly around your ears promising that you can own 10 properties in a year with no money of your own. Real estate is also often mentioned in the same breath as “passive income. But investing is real estate often requires a lot of equity anyway. Is real estate investing with little money even possible? Yes, it can. In fact, investing in real estate can be done in several ways.
Of course, the most obvious form of real estate investing is actually buying a property; this is also called an investment property. You can also invest in real estate in other ways, read and learn!
Investing in real estate with little money
But investing in real estate can also be done in other – less invasive – ways. Investing in real estate with little money, thus more accessible and less risky. For example, you can buy ETFs focused entirely on investing in real estate. You can also invest in real estate through real estate funds. In this article 4 well-known real estate investing platforms: SynVest, CORUM, Exporo and ReInvest24. Through these platforms, you can also actively invest in the real estate market with smaller amounts.
Please note that investing involves risk. Before investing: do your own research, and realize that investing can cause you to lose some of your investment. Check very carefully whether the parties you want to invest with are regulated by AFM and DNB, because only then do they have a license to do business in the Netherlands. Realize that the risk is higher if they don’t have this.
SynVest
SynVest manages investment funds in Dutch and German real estate. For example, investors choose SynVest if they want to build up an extra for later or to supplement their retirement. You can choose your own risk profile and the investor’s life stage is also considered to find the right fund mix. Founded in 2005, SynVest has grown into a serious player in the Dutch investment market. They currently have about 450 million under management. SynVest aims to be accessible to investors large and small. The information on their funds is therefore laid out clearly and understandably. Each fund can be explained in a few sentences, so clients immediately have a clear picture of the opportunities and risks.
At SynVest, you can “Target Investing” or “Free Investing.” Target investing is useful if you have a specific end date when you need a certain amount of money. SynVest’s calculation tool calculates how much you need to put in each month to reach your intended goal. You choose how much risk you want to take. It is also possible to reduce the risk as the end date approaches. They call this “lifecycle. Each year, as an investor, you will automatically be notified if your investment is still on track to meet the target or if you may need to adjust something.
“Free investing” is as the name implies: investing without a specific goal and without an end date You again choose how much risk you want to take. You can choose to have SynVest choose a fund allocation for you or you can create your own allocation (= active or passive investing). SynVest has no minimum entry fee.
Cost
SynVest charges 3 types of fees for their services:
- Entry and exit fees: entry and exit fees are 0.05%.
- A funding fee: the funding fee is 0.50% of each deposit you make.
- Fund fees:annual fees vary by fund. These costs are reflected in the exchange rate.
Advantages
One advantage of SynVest is that it is a completely Dutch company, including customer service and the website, etc. In addition, the information about the funds is actually simple, understandable and clear. Another advantage is that you can invest periodically. Also, there is no minimum entry amount, so that means investing at SynVest is feasible for everyone. Finally, at SynVest you can invest not only in real estate funds, but also in stocks or bonds. So that’s basically like buying real estate ETFs in the stock market.
Cons
The difference with investing in real estate ETFs is that ETFs are freely tradable. This is not the case with SynVest’s fund because you have entry and exit fees. You literally have to pay to get out of the investment. This raises the threshold for doing so. SynVest would like to keep you for the long term.
CORUM
Founded in 2011, CORUM Asset Management has offices in Paris (its headquarters), Amsterdam, Vienna, London, Dublin, Lisbon, Geneva and Singapore. With over 3 billion euros in assets under management, CORUM is one of the largest players in the (European) market. What is characteristic of CORUM is that the funds’ dividends are paid monthly. You can choose to reinvest the dividend. You can also invest periodically at CORUM starting at 50 euros per month.
In the Netherlands, CORUM currently offers 2 real estate funds, “CORUM Origin” and “CORUM XL.” “CORUM Origin” focuses only on Eurozone real estate. The fund focuses on long-term investments, where monthly rental income (= direct return) is higher. CORUM Origin has a direct return target of 6%, which means that they want to be able to deliver 6% returns to investors anyway. CORUM Origin requires a minimum deposit of 1090 euros.
At “CORUM XL,” the focus is on real estate from around the world (except France itself), which is expected to increase in value faster over time. So simply put: real estate in booming locations. CORUM XL has an immediate return target of 5% and an effective return over 10 years of 10% (= not guaranteed). CORUM XL has a minimum deposit of 189 euros, making it much more accessible to join.
So the difference between the two funds is that CORUM Origin focuses on a higher monthly dividend and CORUM XL aims to increase the value of the portfolio. CORUM’s full real estate portfolio can be viewed here.
Investing in a CORUM fund is a long-term real estate investment; they also advise you to keep your money for at least 10 years. It is not necessarily easy to get your money back out in the shorter term. This is partly why they are relatively strict about admission to the CORUM fund. You will be intensively supervised during enrollment by an advisor from CORUM itself and must provide several enrollment documents that will be carefully evaluated before you are admitted. Again, the CORUM fund is not free to trade, as fees are charged the moment you exit.
Cost
The management fee of this fund is 13.2% and the subscription fee is 11.96%. The management fee is deducted directly from the dividend paid. So what you get paid out in your account is really yours, and CORUM’s management fees are already removed from that. The registration fee is settled at the time you decide to opt out. As an example, if you have 1 1090 euro share of CORUM Origin that you want to sell back, then the subscription commission of 11.96% (= 130.36 euros) will be deducted from the current value and thus, instead of the 1090 euros deposited, you will get back only 959.64 euros.
CORUM XL fund management fees are 13.2% and subscription fees are 12%.
Advantages
You get paid monthly dividends when you invest through CORUM. So it is a great way to build passive income. The minimum deposit for the CORUM XL fund is low, so accessible to many investors.
Cons
CORUM is originally a French company. We also looked at the French website and quickly noticed, it is a lot better set up and explains the concept a lot better. In Dutch, the website is somewhat “muddled. They also do not have an AFM license. They do have an AMF license, which is the French AFM. As we wrote earlier, you can’t just get off at CORUM. The 12% subscription fee is charged at the time you sell or exit. You can’t use CORUM for retirement investing.
Exporo
Exporo is a company of German origin founded in 2014, which allows investors to invest in professional real estate – typically involving large sums of money – , through their own online platform. Through this platform, you keep track of your investments and can adjust your strategy whenever you want. You have a complete overview of your deposits and investments at all times. Since 2019, Exporo has also been active in the Dutch market. At Exporo, you invest only in real estate, not funds.
The idea of Exporo, which incidentally is also an official partner of Miles & More, is as follows: investing in professional or business real estate requires large sums of money. This is usually not feasible for the “average investor. BUT, if you bring together a lot of “average” investors, together you can raise the money needed to take on such a large real estate project and benefit from the associated returns. So a kind of crowdfunding for real estate.
Exporo wants – in its own words – to “democratize property ownership.” How? By being cost-effective, convenient and flexible. Exporo, for example, separates the traditional high fixed costs (transfer, administration, brokerage) from the property, which means that as an investor you only benefit from the good aspects of being a property owner. All the benefits, not the burdens. Exporo handles the charges for you and you get the rental income deposited into your account every 3 months.
Investing in real estate is generally seen as a sure way to build wealth. It’s just not the easiest way to invest. That’s why at Exporo, you don’t do it alone. Exporo, through crowdinvestment or crowdfunding (= money from all investors combined), can use high equity. This makes it possible to obtain financing for Exporo’s real estate projects. About half of the financing consists of the investors’ money and the other half of a loan. The ongoing rental income is used for ongoing maintenance and to repay the loan and investors. This ongoing maintenance and development of the property is done by Exporo itself. So this is where they earn their pennies.
Exporo’s minimum deposit is intentionally relatively “low,” at 1,000 euros, so you can invest in multiple properties fairly quickly and spread out your portfolio. You can withdraw your deposit whenever you want. Exporo’s current projects that you can get in on now can be found here.
Cost
Registration with Exporo and use of the platform are free. Capital providers also do not pay a fee for their investment. Exporo receives a fee of about 5% of the entire issue volume (= total value of investments) for structuring the offering, distribution and marketing. In addition, Exporo receives 0.1% for investor support and for ongoing asset management Exporo receives another fee of 5% of annual rent. So you don’t have to feel sorry for them 😉
Advantages
The advantages of Exporo are that you have no initial fees, no blind pool (i.e., direct participation in a property), more efficient structuring and management of your investment and thus a higher payout than real estate funds (believes Exporo). As an investor, you receive dividends from rental income every 3 months, so even with Exporo, you build passive income relatively quickly. At Exporo, you choose the German real estate property you want to invest in. You can trade the 10-year investments early on their platform.
Cons
In principle, the investment offer has a fixed term. Therefore, if you sell earlier, you run the risk of not achieving your return. Since Exporo is originally German, Exporo also does not have an AFM license, which Dutch companies do.
ReInvest24
Reinvest24 has been working within real estate (property development, sales and management) since 2005. With the creation of the platform Reinvest24, the company aims to make real estate investment accessible to all. The first real estate projects were offered in 2018 and several successful projects have already been completed since then. Based in Estonia, the company has projects in Latvia, Moldova, Spain and Germany in addition to its home country.
There are two ways to invest your money in a project. At the “primary market” are the new projects, here each share costs 1 euro each by default and the minimum investment is 100 euros. You can find all the background information on the project here. Once the project is full, the investment becomes final and you will be paid interest the following month. If a project is “full bullet” then you get the interest deposited at the end of the term. In the “secondary market,” you can buy shares from fellow investors, from projects that have been running for some time. Here there is no minimum investment, but the shares cost more.
With all investments, you pay a 1% fee, otherwise there are no fees. With the rental projects, you become a co-owner of a rental property, you get monthly rental income from it, and when the property is sold, you get paid the increase in value, in addition to the investment you have already made. With a rental project, you pay 10% of the rental income on management and maintenance.
What does it provide?
Annual returns are between 13-15% per year for development loans and real estate backed loans. The website has an “investment calculator” that allows you to see what your investments could pay off in the long run. You can find it here. A mathematical example:
Starting deposit: 10,000 euros
Monthly: 100 euros
Annual rate of return: 14%
Capital gain: 0%
Duration: 15 years
Portfolio after 15 years: 144,154 euros, of which 27,900 euros were self-invested, with a monthly passive income of 1628 euros.
When and how do you get your money back?
When investing, you will see an estimated duration of the project. Before a project is completed (exit) you will receive email notification of its completion. You will then receive the money back to your account. You can then transfer this back to your own bank account or use it again to reinvest. If you want to sell your shares in the interim, you can do so through the “secondary market” option.
Advantages
Depositing and withdrawing money costs nothing and is quickly arranged. The downside is that you are locking in your money for a longer period of time. They maintain contact with their investors through blogs and video updates and are actively capturing the real estate market in Europe.
Disadvantage
Basically, you invest with money you can spare, but you cannot liquidate your shares immediately. In addition, the company is based abroad and ReInvest also does not have an AFM license.
Conclusion
Investing in real estate with Synvest, Corum, Exporo and Reinvest24 is a great way to start investing in real estate with a smaller amount. SynVest and CORUM are similar in product and still most similar to the “traditional form” of investing in ETFs or stocks in the stock market. There is a certain fund, which consists of a bundle of real estate projects, and in it you invest in exchange for a certain return (long-term). The only difference is that getting out of the fund is a lot less easy. At CORUM, you can’t even make interim withdrawals. At SynVest, you can do this whenever you want. SynVest offers stock and bond investing in addition to real estate funds.
Investing through Exporo is clearly very different. This is really about a crowdfunding principle. The “Many hands make light work” idea. You suddenly have access as a private citizen to projects you could not even dream of otherwise. You can choose which project you get in on, and you can also get out fairly quickly.
Personal choice
With all three there is a lot to gain and you can lose your entire deposit. Which one you would possibly choose for is really a personal consideration and choice. It just depends on what you are looking for, how much money you have free to invest and what you want to achieve with it. Moreover, it is often also a matter of feeling. Do you care that it is a Dutch company with an AFM license? Then SynVest is the one for you. Do you like Exporo’s investment concept and care that such a thing exists? Then this is the best broker for you. Do you like the idea of a company operating all over the world? Then get on CORUM. All four didn’t? Then look further. Fortunately, there are plenty of fish swimming in the sea… 😉
Extra tip: All four have a Dutch website, but during research we found that sometimes it is better to also check the “original” website, that is, of Exporo the German one and of CORUM the French one. Sometimes there are infographics or videos on there that are a lot clearer than those on Dutch.
