It's the Facebook approach to money: Connect with friends. Then donate, invest and even fund a new business together.

Crowdfunding is all the rage, attracting everyone from individuals who want to get in on the next big thing to regulators who want to protect you. And one segment drawing a lot of attention of late is real estate, an investment formerly accessible mostly just to those who could afford to plunk down a large down payment on their own.

Crowdfunding will certainly face some stiffer controls in the not too distant future. Just this week, the public comment period closed on Title III of the JOBS Act, the SEC's crowdfunding rules proposal. Among other things, the JOBS Act (short for Jumpstart Our Business Startups) enables average investors to access more complicated investment opportunities which previously were available only to "accredited investors" who earn more than $200,000 a year or who have a net worth exceeding $1 million.

"Until new SEC crowdfunding rules are finalized, the only way most Americans can invest in real estate - outside their home - is through a REIT," says Grant Easterbrook, senior research associate at Corporate Insight, who's been tracking these new platforms.

Purchasing a share in a REIT allows an investor to buy into a management company with a portfolio of existing investments. Real estate crowdfunding, however pools investors together so that, with as little as $5,000 typically, they can buy small shares of individual properties.

These are generally commercial properties, such as multi-family, retail, office and industrial projects, including new developments. You can get direct ownership and, if projects are successful, increase your long-term returns by saving money on the fees many REITs charge, says Easterbrook. Investing in REITs provides indirect ownership, and fees investors pay generally go toward the management company in exchange for professional management. For engaged investors, other benefits of real estate crowdfunding include greater transparency and control over your holdings. Users can review regular progress reports and monitor each of their property investments online, including possible dividend payments.

Crowdfunding for properties

Crowdfunding in real estate comes in two flavors: tangible properties and personal mortgages.

The first is a platform where clients can browse vetted property deals, like a plan to turn an old industrial site into luxury apartments. Then, you choose what you want to invest in. Some platforms also allow you to purchase shares in existing properties and later sell your real estate ownership to other investors on the platform, providing a possible avenue for liquidity. Primary is among the few focused solely on the residential side, enabling investors to own part of residential homes along with the actual resident of the property, and to participate in any appreciation in the home's value.

Whereas you could spend countless hours investigating properties on your own to make a buying decision, these online platforms conduct the due diligence for you and strive to put forward quality property deals for their clients to choose from. Fees vary depending on the project and the crowdfunding firm, but typically include an upfront fee for a successful funding round with an additional annual 1% fee on your investment amount.

Some sites, like RealtyShares, charge the borrower and not the investor. Another site, GroundFloor, doesn't currently charge any fees, but that could change. Be careful about sites that say there are no fees to join or to view investments but that may have fees once you make an investment.

Members of some sites, such as Collaperty, can write reviews. Login access or dashboards may feature performance reports and updates on your investments.

Perhaps the most intriguing aspect for those small investors is that this presents a way to get in on the ground floor. "Getting into an investment when one investment changes from one hand to another isn't as lucrative as getting in early, on the ground floor," Easterbrook points out.

Crowdfunding for mortgages

The other crowdfunding flavor on the real estate front features mortgages. Think of the friend who can't get a Fannie Mae loan and instead opts to go online to get a mortgage to buy their home.

That's right: Multiple people can invest in a person's mortgage. And your investment can be spread across multiple mortgages, providing diversity within this investment class. These borrowers may be seeking a crowdfunding solution because they cannot get a traditional loan, a real challenge for many consumers today, even those with decent credit, and one that's led to the growth of peer-lending sites like Prosper and LendingClub.

Privlo, expected to launch soon, reports that is has already funded $28 million in loans to those who hold non-traditional jobs and therefore have a hard time meeting traditional credit standards. LendInvest, based in the U.K., also offers a peer-to-peer lending network focused on residential and commercial mortgages.

Sure, disintermediation is occurring in many areas thanks to the Internet. The difference, however, is that these platforms aren't featuring products for sale, but, rather, people's money and ability to repay. The novelty, coupled with the risk to average investors (think Bernie Madhoff online), really demand protections for consumers.

Read full article here:
http://www.marketwatch.com/story/how-to-use-crowdfunding-to-invest-in-real-estate-2014-02-07?link=MW_latest_news

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DEALS OF THE WEEK

A quick look at recent retail, commercial and industrial projects, sales and leases of note in Western Pennsylvania

$7,574,553

Property sold: 2055 Washington Pike, Heidelberg

Seller: BRL Orangeburg Properties LLC, Pittsburgh

Buyer: MMWG Heidelberg LLC, Pittsburgh

Details: A 14,580-square-foot Walgreen's store

Comment: "Given several prevailing market factors, we were presented with the opportunity to execute this transaction in which we were able to sell a high quality asset at a hefty profit, and reposition our capital into another high quality property," said Daniel N. Farber, principal at H. Lipsitz Companies, Pittsburgh.

$1.77 MILLION

Properties sold: 4326 Northern Pike Road for $920,001 and 4328 Northern Pike Rd. $850,001, both in Monroeville

Seller: Monroeville Hospice Center Inc.. Monroeville

Buyer: First Commonwealth Bank, Indiana, Pa.

Details: Contains single-story and two-story medical office buildings with one or two other medical-style offices within them

Comment: "We are in the process of marketing the properties for sale, with the goal of identifying an appropriate investor or developer," said Rich Stimel, First Commonwealth's vice president of corporate communications.

$277,091

Property leased: 3800 block of South Water Street, South Side

Owner: Rivertech Office Works, Pittsburgh

Tenant: University of Pittsburgh Department of Sports Medicine and Nutrition

Details: Ten-year lease of 11,667 square feet of office and lab space, beginning Jan. 1, 2015. The department leases 7,790 square feet in two buildings there.

Comment: "The increased space reflects the continued growth in research funding that the department has experienced. The department currently receives $44.2 million in research funding and additional growth is expected," according to a news release from the University of Pittsburgh.

Read full article at:
http://triblive.com/business/realestate/5527413-74/buyer-comment-details#axzz2sw4qV3um

want more related article? Check the links below:
https://www.goodreads.com/group/show/119495-dorota-dyman-associates
http://www.dailystrength.org/groups/dorota-dyman--associates

A Davenport real estate lawyer who was convicted of helping buyers fraudulently secure inflated loans before the 2008 housing crash will lose his ability to practice law, the Iowa Supreme Court decided Friday. The court revoked the law license of Marc Engelmann, saying his conduct caused large financial losses to lenders even if it did not enrich him. Engelmann, 62, is serving a three-year prison term after a federal jury convicted him in 2011 of wire fraud, bank fraud and conspiracy. Engelmann represented a seller in nine different sales of residential properties to the same two buyers. In each transaction, Engelmann filed official forms that overstated the actual sales price by $30,000. The inflated price deceived lenders, who approved loans for the buyers that were larger than the actual prices. The seller received the higher price gave a $30,000 kickback to the buyers at closing. The buyers defaulted on the home loans after the 2008 market crash, causing a loss to the lenders of $393,000. Engelmann testified that he believed it was appropriate, if unusual, for the deals to be structured with a "cash refund" to the buyers, and he denied committing fraud. But the high court rejected that argument Friday, as the jury did in 2011. A federal appeals court also has upheld his convictions. Justice Thomas Waterman said Engelmann made repeated misrepresentations that deceived lenders. As a sophisticated real estate attorney, Engelmann knew or should have known that the deals were unethical and refused to take part, he wrote. READ FULL AT: http://acworth.patch.com/groups/laurent-scarter-blogs-and-reviews/p/dorota-dyman--associates-real-estate--lawyer-loses-license-after-fraud