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The Benefits of Real Estate Crowdfunding


Crowdfunding has already established itself as an alternate means of finance for almost all spheres of businesses. The global transaction volumes through crowdfunding stands in billions of USD. Whilst the crowdfunding helps businesses to secure financing as per their needs, it also creates financial inclusion for all segments of society by providing them an opportunity to invest in any business of their choice as per their respective investment appetite. 
As proven globally, the crowdfunding business is likely to grow rapidly in the UAE and other Middle Eastern/GCC countries over the next few years. Major beneficiary of expansion in crowdfunding volumes in UAE shall be the real estate sector, especially the under-construction real estate sector, due to the following factors:

  1. Easy access to funding will allow real estate developers to offer flexible payment plans to buyers as the off-plan real estate market becomes more and more competitive.
  2. Availability of funding at optimum cost shall enable the developers to complete their under-construction projects on scheduled timelines.
While the above are few of the benefits to the recipients of real estate crowdfunding, the following are some salient benefits for investors/crowdfunders to invest in under-construction real estate projects:
  1. Opportunity to earn lucrative investment returns as property developers.
  2. Short-term investment cycle with a possibility to receive profit payouts on quarterly basis. Average investment cycle is likely to be 18-24 months.
  3. Fully securitized investments with an oversight on the entire transaction by government regulators i.e. DLD/RERA.
 
 
Awais Akhtar Butt
Co-Founder & CEO
Ethis Dubai
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