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Roofstock is an online marketplace for property. The company is based in California and despite being a relatively new startup that has only been around since 2015, the platform has already established itself as a top financial services provider. Roofstock specializes in investent properties, meaning that you can buy properties that already have tenants renting the, saving you some hassle.
Pros
Low commission fees – the platform charges just $500 or 0.5% of the contract price (whichever is higher) on all properties transacted on the platform.1000+ properties you can choose from – the platform offers a wide selection of investment properties, many of which are already rented out to tenants.Fast transaction times – closing can take place within 15 days for cash purchases or within 30 days if you are paying for the property with financing.Relatively low financing fees – Roofstock works with preferred lenders to offer investors fees of as little as 3.49% on loans for property buyers.
Cons
High minimum investment – the minimum sum you must invest with Roofstock is $5000, making it not very suitable for novice with lower capital.Illiquid investment – if you want to cash out on your property, it can take anywhere from 2 months up to a year to find a buyer and sell it.
Jump to: Full Review
Compare to Other Investment Apps
Fundrise
Invest in real estate properties with a $10 minimum initial investment
Historical annual return varies from 8.8% to 12.4% (2019 – 9.47%)
Low annual fees: advisory – 0.15%; management fee – 0.85%
Public App
Manage your portfolio of stocks, ETFs, and crypto investments – all in one place
Over 5000 stocks and ETFs to choose from (dividend stocks available)
Follow other investors, see their portfolios, and exchange ideas
Acorns
Invest your spare change in a diversified portfolio built by experts
Expect up to 7.5% annually returns with plans starting from $3 a month
Earn bonus investments from 350+ Acorns Earn partners
How Does Roofstock Work?
Roofstock is an online marketplace where real estate investors can easily buy and sell properties. The company has been around since 2015 and has expanded to over 70 marketing since it was founded. There have been over $5 billion in transactions on the platform, and there are currently over 200 Roofsters.
You can use Roofstock to purchase properties, portfolios, and property shares for investment purposes. The platform specializes in single-family homes that already have tenants. Thus, when you buy a property, there are already tenants, allowing you to immediately earn rental income after purchasing the property.
Moreover, properties on Roofstock marketplace undergo inspection and certification, so you will not need to incur additional costs to do so. Unlike real estate crowdfunding platforms, you do not just buy a fraction of a property with Roofstock. Instead, you are buying the whole property and will hold the direct title.
In addition, you do not need investor accreditation to use the Roofstock marketplace to buy properties.
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How Much Can You Earn With Roofstock?
Roofstock provides estimated returns for each property on sale through the platform. Your earnings will vary depending on the property that you purchase. You can check the estimated potential returns for a property before deciding whether or not to buy it.
Most properties have a projected cap rate of between 5% and 8% and a gross yield rate of between 7% and 19%. You can also view a projected appreciation for each property to see how much it is likely to increase in value.
Roofstock Reviews: Is Roofstock Legit?
Roofstock is a legitimate platform that has been around since 2015. It is not accredited by the BBB but it has a B+ rating.
The platform has received many positive reviews from its users. Reviewers praised the platform for offering a wide range of properties that have high returns. Users were also satisfied with Roofstock’s reliability and pre-screening of the properties on its platform.
However, some users have complained that the platform is expensive and charges high fees. Some users also reported problems with the platform’s customer support, stating that it was not reliable.
Who Is Roofstock Best for?
Roofstock is ideal for anyone who wants to start investing in the real estate market. Real estate is a lucrative market since you can earn profits on the increased value of your properties and regular rental incomes.
Roofstock also makes it easy for anyone to purchase rental properties remotely. Thus, if you want are looking for passive income ideas or want to diversify your investments, Roofstock can be suitable for you.
Roofstock Fees & Pricing
The Roofstock marketplace is free to use, allowing you to browse and make offers for free. However, you will need to pay a fee whenever you buy or sell a property on the platform.
The fees that Roofstock charges are significantly lower compared to traditional real estate brokerages, which typically charge around 6% per transaction.
FeesRoofstockTraditional BrokerageBuying a Property0.5% or $500, whichever is higherAround 6%Selling a Property3% or $2500, whichever is higherAround 6%
Roofstock Features: What Does Roofstock Offer?
Roofstock Property Management
Roofstock’s property management feature allows you to use the services of world-class property managers. A property manager can help you take care of the properties you purchase so you do not need to visit them.
They will help you manage clients on your behalf, collecting rent from them and addressing any issues they face. Thus, you can earn rental income from your Roofstock properties remotely, in exchange for a reasonable fee.
Roofstock One
Roofstock One is a full-service investment option that enables you to invest in real estate and earn a passive income. To use this feature, you will not need to purchase properties. Instead, you can buy shares in various single-family properties.
Some of the benefits of Roofstock One include:
However, Roofstock One is only available to accredited investors, meaning you need to have an annual personal income of at least $200,000 or a joint income of $300,000.
Roofstock One comes with an annual asset management fee of 0.5% of the home price and a property management fee of 10% of gross rent. Part of these fees will also be allocated to a reserve fund to pay for repairs, insurance, and taxes.
Roofstock 1031 Exchange
At its roots, 1031 Exchange allows real estate investors to swap one investment property for another and defer capital gains taxes if they meet IRS rules.
Some of the benefits of using Roofstock 1031 Exchange include:
Guiding throughout the entire process of closing the deal
Identifying high-quality replacement investment portfolios
Assisting you in selecting the best property management partners
Referring qualified intermediary partners to facilitate your transaction
Referring the best lending partners to provide you with the right loan solution
Providing an inventory of stabilized properties ready for purchase
Roofstock IRA Investing
Roofstock also enables you to buy and hold investment properties in your IRA. The platform partners with the New Direction Trust Company, which helps to handle the administrative and custodial aspects of your IRA. Thus, you will then be able to purchase real estate while enjoying the tax advantages of your retirement account.
Here are some steps that you can follow to invest in your IRA with Roofstock:
Open and fund your IRA with New Direction Trust Company
Choose property on the Roofstock marketplace to invest in
Buy properties on Roofstock and diversify your IRA portfolio
30-Day Money-back Guarantee
If you are unsatisfied with a property you bought on Roofstock, you can notify the platform within 30 days of closing.
Roofstock will relist your property on their marketplace free of charge. When the property sells, you will get a full refund, regardless of the sale price of the listing. If your listing does not sell within 90 days, Roofstock will buy the property from you and provide a full refund.
You must return your property in the same condition you purchased it in, and you are responsible for maintaining the property until it sells.
Roofstock Requirements
There are no requirements for you to buy and sell properties on Roofstock.
However, if you want to invest using Roofstock One, you must be an accredited investor. There is also a $5000 minimum investment amount.
Roofstock Payout Terms and Options?
When you invest in a rental property with Roofstock, you will earn a rental income from it. Since you become the owner of the property, you will be able to collect your rental earnings directly from the tenants.
If you choose to use a property management service such as Roofstock Property Management, the company will help you collect rent from your tenants. They will then deduct fees and pay you directly, typically via direct deposit into your bank account.
Roofstock Risks: Is Roofstock Safe to Invest With?
Roofstock is a safe and legitimate platform you can use to invest. The company inspects and certifies all of the properties available for sale on its platform.
Moreover, every property available on Roofstock already has tenants living in them. Thus, you can start earning returns on your initial investment right after purchasing a property.
Nonetheless, all investments carry risk, and there is always the chance that you may make a loss on your investments if it decreases in value or loses tenants. Thus, you must do proper research to ensure that you invest in good properties.
How Does Roofstock Protect Your Money?
When you buy a property on Roofstock, you gain full ownership of the property. The platform does not control your property at any point, and you will still own your property even if the company were to shut down.
What Are the Roofstock Pros & Cons?
Roofstock Pros
All properties available for sale on the platform already have tenants and are inspected by the company
Low fees of just 0.5% or $500, whichever is higher, when buying a property
Fast processing time of under 15 days for cash purchases and under 30 days for financed purchases
Over 1000 properties that you can browse on the platform
Roofstock Cons
You must be an accredited investor to use Roofstock One
There is a $5000 minimum investment for Roofstock One
How Good Is Roofstock Support and Knowledge Base?
Roofstock has a comprehensive knowledge center on its website that you can visit if you encounter any issues while using the platform.
If you have any questions you cannot find the answers to in the knowledge center, you can contact the company directly via email or phone.
Roofstock Review Verdict: Is Roofstock Worth It?
Roofstock is one of the best real estate marketplaces that you can use if you want to start investing in real estate. The platform has a wide selection of investment properties that have been inspected and certified. Moreover, all properties on the platform already have tenants so you can start earning rental income immediately.
In addition, you can also use the Roofstock Property Management feature to earn a passive income remotely. Property managers can help you with the daily management of your property, so you do not need to visit the property to collect rent.
If you are an accredited investor, Roofstock also allows you to purchase shares in rental properties starting from just $5000. Overall, this makes Roofstock a great platform for anyone to buy and sell properties.
How to Sign Up With Roofstock?
To sign up with Roofstock, you will need to visit the website to create an account. You will need to provide some personal information to create an account. Once your account has been verified, you can start browsing properties for sale on the platform.
Note that you will need an account to browse property for sale on the platform.
Sites Like Roofstock
Roofstock vs. Acorns
Acorns Summary
Low account fees from just $3 per monthGet $5 in your account for referralsLow minimum starting investment amountHigh average return on investments of 7.5%
Acorns is a reliable alternative platform to Roofstock if you want to invest in stocks and ETFs. The platform is best known for its Round-Up investing feature. This feature allows you to round up your spending to the nearest dollar. It then helps you save and invest the spare change.
When investing with Acorns, you can also choose from five different pre-built portfolios. This makes Acorns a better option for beginners since you do not need any specialized knowledge of investing.
Acorns is also great for beginners due to the low minimum investment amount of $5.
Roofstock vs. Fundrise
Fundrise Summary
Low minimum starting investment of $10High historical returns of 8.8% to 12.4%1% of management feesDiverse portfolios of up to 16 investments
Fundrise is a popular alternative to Roofstock for real estate investing. It functions as a crowdfunded investment platform, enabling you to buy shares of properties and diversify your investments across your portfolio without owning entire properties.
Fundrise also charges a relatively low management fee of just 1% per year. Thus, this makes Fundrise a good alternative to Roofstock if you do not want to invest in entire properties.
Roofstock vs. Public
Public App Summary
Invest in stocks, ETFs, and crypto$0 commission fees for any stock tradesOver 100 articles to learn about investingLow 1-2% commission for crypto trades
Public is a platform that allows you to invest in various assets such as stocks, ETFs, and cryptocurrencies. One of the most popular features of Public is its fractional investing feature. This feature allows you to buy and share fractions of a share, allowing you to invest in expensive stocks while diversifying your portfolio.
Public is also well-known for its commission-free trading, allowing you to buy and sell shares for free. There are also over 100 free articles on Public’s website that you can read to learn more about investing. Thus, you can consider using the platform if you are looking for a way to invest in the stock market.
Other Sites Like Roofstock
Roofstock FAQ
What Is Roofstock?
The company has also received many awards, including:
Entrepreneur 360 Best Entrepreneurial Companies in America
Forbes Fintech 50 Most Innovative Companies
2019 HW Tech 100 Winner: Roofstock
CB Insights Fintech 250
Finovate Best Alternative Investment Platform Winner
And many more
What is the catch with Roofstock?
If you use Roofstock to view properties without purchasing them, you will not need to provide any payment details and there is no catch. If you want to purchase a property on the platform, there is a brokerage fee. However, the fee structure is very transparent and is listed on the company’s website.
Can you make money on Roofstock?
There are two ways for you to make money on Roofstock. Firstly, you can make money fast by purchasing a rental property that already has tenants and collecting rent from them.
You can also make money by buying a property for investment and selling it when its value increases.
Is Roofstock for accredited investors?
Anyone can buy and sell property on Roofstock. However, if you want to use Roofstock One, you must be an accredited investor.
Does Roofstock own property?
Most of the property available for sale on the platform is not owned by Roofstock. Instead, they are owned by private individuals who list them.
Is Roofstock publicly traded?
Roofstock is not currently publicly traded.