Real Estate Crowdfunding. A financial innovation for direct property investment | Land Portal | Securing Land Rights Through Open Data

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Date of publication: 
December 2016
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The aim of this work is to provide a simple overview on crowdfunding with a focus on its potential application to the real estate market.
The Global Financial Crisis of 2008 paralyzed the global economy, creating a strong diminishing trust in financial services and in the banking system in general. One of the most revolutionary systems to get funded in the market has been crowdfunding, a way of financing coming directly from the crowd through the Internet.
Crowdfunding in real estate started in 2012 with the Jumpstart Our Business Startup Act (JOBS Act) in USA and has been developing at a fast rate every year.
In Italy, crowdfunding for real estate projects is not allowed yet, but there are various platforms that are already using the concept in different ways.
Real Estate Crowdfunding could represent an interesting opportunity for private individual to have an exposure to direct real estate investments.
After an initial description of crowdfunding in general, we present real estate crowdfunding in the U.S. by presenting the most relevant cases up to date. Finally, we analyze the Italian market by explaining why this innovative way of financing real estate projects is not feasible yet and how some platforms are legally
trying to overcome the current limitations.
In the U.S. the RECF has already raised more than $1 billion and there are more than 125 platforms; in Italy there are still limits for startups dealing with crowdfunding and a few platforms are starting to operate with a similar model.

Authors and Publishers

Author(s), editor(s), contributor(s): 
Giacomo Morri Marco Ravetta
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Territorio Italia - Governo del territorio, catasto, mercato immobiliare è una rivista scientifica open access peer-reviewed, edita dall'Agenzia delle Entrate, che intende porsi come ponte tra la ricerca scientifica, che si svolge nel mondo universitario, e la Pubblica Amministrazione, che ha un ruolo di fondamentale importanza nel processo di ammodernamento del Paese.

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