InvestorGreg.net is compensated in exchange for featured placement of sponsored products and services, or your clicking on links posted on this website. That's how we make money. This compensation may impact how, where and in what order products appear. InvestorGreg.net does not include all companies or all available products. We will never allow advertisers to influence our opinion of financial products that appear on this site.
Roofstock is an online marketplace that focuses on making investments in the single-family rental space. The creators of the platform have a long track record of investing in this sector and it is looking to make the space a lot more transparent and efficient. Buyers will be able to invest in vetted homes that have nice potential for cash flows, while sellers can market their homes without having to deal with tenant disruption or losing income.
This Roofstock review will look at all of the different aspects that make up this offer, allowing you to determine if it will be a good fit for you.
Own actual property
With Roofstock, you are buying actual property and not just investing in a share of a loan.
Don’t need to be accredited
If you want to buy a rental property through the Roofstock platform, there is no need for you to be an accredited investor.
Cash flow investments
As you are not flipping houses but instead buying a property to earn rental income and you are not dealing with significant repairs, as soon as the property gets rented you will be cash flow positive.
Ease of use
Unlike having to physically go from potential rental property to potential property in real life, you can quickly filter through the different options online, checking out the 3D tours and inspection documents. This takes the entire process much more efficient.
Big down payment
Unlike other online platforms, you are actually buying a house through Roofstock. Therefore, you will have to put down a down payment of 20-30% of its value if you are going to get a mortgage.
Roofstock makes investing in single-family rental properties radically simple.
Where Roofstock Stands Above Competition
Roofstock is a platform that allows you to purchase rental properties rather than just buying a share in a property or buying an interest in a loan. The process is very good for people who do not have time to view loads of rental properties, as everything is done for you through Roofstock.
Where Roofstock Falls Short
As you are buying a property, the amount you need to invest will usually be a lot more significant than if you were buying a share in a property or interest in a loan.
Fees & Features
One of the main aims of the Roofstock marketplace is to keep this type of investing low cost for investors. If you make an offer on one of the properties that are listed on Roofstock, you will need to provide your credit card info while doing so. This makes sure that you are not making an offer without being serious about the investment.
There are usually many offers for a given property, so this helps to narrow down the selection process. If you are successful and your offer gets acceptance, then you will have your credit card charged whichever is the higher sum of 0.5% of the contract’s price or $500. Once this fee has been processed, the property will then be taken off Roofstock. This means you have entered into a contract meeting your desire to purchase the property and you will then proceed to the subsequent steps to buying the property.
Naturally, whenever you buy a property there are also going to be associated fees such as transfer taxes, insurance fees, loan fees, closing and documentation fees. The only fee taken by Roofstock is when your offer has been accepted.
How Does Roofstock Work?
Roofstock offers a very passive way for you to invest in single-family properties. You do not have to go through the process of searching for properties, dealing with an agent, touring each of these residences and going through the entire documentation process. All of this has been done for you thanks to Roofstock.
As opposed to a lot of other platforms, with Roofstock you are actually buying the entire property rather than providing money for a family to make renovations. Therefore, this is not a form of crowdfunding, it is a more streamlined and cheaper manner to buy a property for rental purposes.
If you like to look of the Roofstock offering and you want to get involved, the process of getting started is pretty easy and straightforward. The platform is free to join and there are no access or membership fees that have to be paid. Each of the properties on the platform has been fully certified and there is a 30-day buyer satisfaction guarantee after you have bought a property through Roofstock.
To help you with getting started investing with Roofstock, you can access a number of useful resources on the website. This includes the site’s complete guide for getting started, as well as checking out the webinar series or the one on one coaching through the Roofstock academy.
The basic premise of Roofstock is the purchasing of homes and having it as a rental property. This means that you will be the sole investor in the given property. All of these homes have been certified and you can take online 3D tours of them, check out reports on potential repairs that will be needed, a floor plan, valuation analyses and a number of other key aspects. At any one time, there are hundreds of different properties for you to look through.
There is now a new product offering for accredited investors on the Roofstock platform. This is called Roofstock One and it allows these investors to buy shares of a given property. A share will be a tenth of the equity of a home and the investor will get a return in the net rental income after expenses of this property. All of the management and maintenance of the property is all taken care of by Roofstock.
As mentioned, all investors are able to purchase properties through the Roofstock offering. There is also the Roofstock One program for accredited investors to buy shares in a given rental property.
The main focus of Roofstock is on single-family homes. These properties can be found across the United States. There is also the ability to buy a portfolio of different properties in one go.
If you build a portfolio of properties through the Roofstock platform, you will be able to now buy real property and do so even if you are a non-accredited investor. You will have access to cash flow positive investments and you can have these rental properties managed for you if you want.
The Roofstock platform is very easy on the eye and simple to use. The color scheme is basic but allows for the text to be very clear. You are not inundated with different types of options, the navigation system is very clear. The respective properties are well-laid out and you can use in-depth filter tools to find the exact types of properties you are looking for.
The process of making an offer on a property is extremely straightforward. All you need to do essentially is add in your credit card info and you will be ready to submit a bid. This platform takes a lot of the hassle out of the equation for people trying to find rental properties to invest in. Overall, you will find it hard to find a more efficient platform than what is seen with Roofstock.
Deposits & Withdrawals
When it comes to the Roofstock offering, there is no inherent deposit or withdrawal process necessarily. If you are purchasing a property, you will have to enter your credit card info when you make an offer. If this offer is accepted, your credit card will then be charged the greater of $500 or 0.5% of the contract price.
You will then work with a lending partner in order to finance the deal if you are not buying the property outright with cash. If you are an accredited investor that is part of the Roofstock One feature, you will be able to earn regular rental income that will be passed onto you by your property manager. Usually, this will be sent to you via a bank transfer.
If you have any issues or questions that you would like answered about Roofstock, your first destination will be the very useful FAQ section. This has answers to the majority of questions someone could have about the Roofstock offering.
If this section is not able to resolve your issue, then you can get in touch with the support team directly either through an email or by ringing them on the phone. The team is well trained and well able to quickly and efficiently resolve the issue you may be having.
Security & Reliability
If you are purchasing a property through the Roofstock platform, there is a 30-day guarantee in place. This means that if the property you bought got approval through the Roofstock inspection process before the contract closing and you are not happy with the property you have bought, you will be able to get a refund.
There is also a rent guarantee in place that means you will be guaranteed rent on vacant properties 45 days after the home is ready for rental. There will also not be any monthly management fees in place until the property has been leased.
In terms of the security of your data, Roofstock uses the latest in encryption technology to ensure that all of this private data is properly protected. For credit card processing, the industry-standard Braintree platform is used. Roofstock will also not sell or share any of your personal data with third parties.
What Roofstock Is Best For
- Roofstock is well-suited to those people who are looking to buy a rental property outright and may not be an accredited investor.
- It is also ideal for those who want to buy a rental property in a hands-off manner, not having to worry about its management or going through the lengthy process of physically touring around countless different properties.
- Overall, Roofstock is ideal for efficiency in the process of buying rental properties.