If real estate is a key investment for the French, not everyone is destined to become a lessor.

The solution ?

Turning to "stone-paper", by placing your money in products financing the sector... In addition to the various classic equity funds and investment companies (SCPI), more and more savers are turning to the crowdfunding.

Since the regulation of the market in France in 2014, crowdfunding has experienced exponential growth which broke all records in 2021. That year, 958 million euros were collected through some forty web platforms, i.e. 90% more compared to 2020, according to the barometer published by Fundimmo.com, one of the five biggest players in this area.

Financing residential

In line with the trend of collaborative finance, real estate crowdfunding allows individuals to invest their savings directly in the projects of professionals and in this case in those of property developers and merchants.

And unlike a fund that spreads your money left and right, here you alone decide which operations you want to support.

In practice, it will essentially be a question of financing the construction of housing, which France still and always lacks, knowing that they represent 81.7% of projects in 2021 according to the Fundimmo barometer.

Next come offices (9.8%), shops (9.7%), hotels (3.8%) and miscellaneous fittings and renovations (2.2%).

In terms of location, Île-de-France, the PACA region and Auvergne-Rhône-Alpes capture 74% of collections.

Attractive financing

If crowdfunding is so popular, it is because it offers several advantages.

First of all, it democratizes real estate investment by putting it within the reach of average savers, where it was previously often reserved for very large investors.

As Benoît Bazzocchi, President of Fundimmo, explains to us, "you can generally invest in a project from €1,000, which remains accessible and allows you to multiply projects to spread the risks".

Better still, crowdfunding allows funds to be immobilized for a short period of time, in return for high remuneration.

"Operations last between 12 and 36 months, with a yield that varies between 8 and 10%", specifies the specialist.

On average, the investment period thus reached 21.2 months for an annual rate of return of 9.21% in 2021, according to the sector barometer.

Be careful, however, to take into account delays in the construction and sale of goods which can lead to a delay in reimbursement (6.61% in 2021) and thereby further immobilize your money.

Rigorous diversification

Despite the good arguments of crowdfunding, you should not get the wrong objective.

"It is a tool for diversifying assets with a set of higher returns and risks", according to Benoît Bazzocchi.

Therefore: "You must already have classic and secure savings" before starting.

Indeed, crowdfunding does not offer any capital guarantee, which means that it is necessary to accept, and especially to be able to assume, possible financial losses, and this, even if the default rate of repayment of the sector was limited to 0, 09% in 2021.

To put the odds on your side, we therefore apply the adage that we do not put all our eggs in one basket!

Clearly, you only invest part of your savings in crowdfunding and you prefer to bet small amounts on a multitude of projects rather than placing a large amount of capital on a single real estate program.

Ideally, it is also better to diversify intermediation platforms.

Economy

Borrowing: How to use crowdlending while remaining vigilant

Economy

Participatory wedding, the new trend!

Good landmarks

  • The label: real estate crowdfunding players must hold an authorization from the Financial Markets Authority (AMF) or the Prudential Control and Resolution Authority (ACPR).

    Make sure that the official logo bearing the mention “Platform of crowdfunding regulated by the French authorities” is displayed at the bottom of the site.

  • Quality: to assess the reliability of the platform, check its creation date, the number of projects financed, the amounts collected and its overall success rate.

  • Projects: each collection indicates the total amount expected, the duration of the operation and the interest rate charged.

    Carefully review everything!

  • Fees: as a general rule, the intermediation commission is invoiced to the professionals supported and not to individual investors.

    But you should make sure before you start.

  • Saving

  • Crowdfunding

  • Investment

  • Lodging

  • Economy

  • Video

  • Crowdfunding