If you’re looking to invest in out-of-state rental properties without the six-figure down payments, cross-country flights for property inspections, and the headache of managing tenants from a distance, you’re not alone. The traditional model of out-of-state investing requires a 20% to 25% down payment, a trusted local property manager, and enough cash reserve to cover vacancies and emergency repairs sight unseen, barriers that shut out most investors. Fractional real estate platforms have emerged as an accessible alternative that removes those barriers entirely by letting investors buy shares of rental properties starting at $20 per share. The market reached an estimated $4.2 billion in 2025 with over 6.3 million registered users globally, reflecting a structural shift in how individuals access real estate returns. In 2026, the choice of platform matters more than ever: liquidity has tightened across the industry, fee structures vary by an order of magnitude, and the difference between monthly and quarterly dividends compounds significantly over time. This guide compares the seven leading fractional platforms for out-of-state investors across minimums, fees, liquidity, and real-world returns so you can match a platform to your specific investment needs. Each platform entry includes verified metrics on pricing, dividend frequency, secondary market access, and the practical considerations that determine whether a platform works for remote investors who cannot visit properties or attend shareholder meetings in person.
Key Takeaways
- Fractional real estate platforms allow out-of-state investors to own shares of rental properties starting at $20 to $100 per share, eliminating the need for down payments, property management, or local market knowledge.
- Liquidity varies dramatically across platforms, from monthly trading on regulated secondary markets to multi-year lockups with capped redemptions.
- Fee structures differ significantly; zero-AUM-fee models can save investors thousands compared to platforms charging 0.4% to 1.5% in annual management fees.
- The 2026 liquidity crisis has affected multiple major platforms. Fundrise paused redemptions in October 2025, and RealtyMogul suspended its share repurchase program in April 2026.
- Combining two or three platforms can optimize for liquidity, diversification, and property selection based on individual investment goals.
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Explore Ark7 OpportunitiesWhy Fractional Real Estate Suits Out-of-State Investors
Fractional real estate investing solves a problem that has frustrated remote investors for decades: how to own rental property in a growing market without being there. Traditional out-of-state investing requires a 20% to 25% down payment, a local property manager, and the ability to absorb vacancy costs and emergency repairs. Fractional platforms remove all three barriers.
The market has responded. Over 6.3 million registered users have accumulated roughly $2 billion in cumulative transaction volume across fractional ownership platforms as of early 2026. Residential properties account for 41.3% of the market, and North America holds 38.6% of global revenue. The demand is driven by investors who want real estate exposure without the operational burden, a group that includes remote workers, retirees, and professionals who lack the time or capital for direct ownership.
Platform selection matters more in 2026 than it did a year ago. Multiple platforms have restricted redemptions, paused share repurchases, or faced regulatory challenges. An out-of-state investor who cannot visit properties needs to trust that their platform can return capital when asked. That makes fee structure, secondary market availability, and track record the deciding factors.
Which Fractional Platforms Suit Out-of-State Investors?
The following seven platforms represent the leading options for out-of-state fractional real estate investing in 2026. The list covers equity ownership, REIT funds, real estate debt, and tokenized property, each with distinct trade-offs in minimum investment, fees, liquidity, and investor requirements.
- Ark7: SEC-qualified shares of individual rental properties starting at $20 with zero AUM fees, monthly dividends, and an SEC-registered secondary market for share trading after 12 months.
- Fundrise: Pooled eREIT funds with a $10 minimum, ~1% annual fee, and broad diversification across multifamily, industrial, and commercial properties in Sun Belt markets.
- Arrived: Individual rental property shares at $100 minimum with a 0.4% to 1.2% AUM fee, backed by Jeff Bezos and Marc Benioff, with a 5-to-7-year expected hold period.
- RealtyMogul: REIT funds and individual commercial deals with a $5,000 minimum for REIT products; currently paused to new investors across multiple programs.
- Lofty AI: Blockchain-tokenized rental properties on Algorand starting at $50 with daily rent distributions and a 24/7 trading marketplace.
- CrowdStreet: Direct commercial real estate deals for accredited investors requiring $25,000 minimum per deal with no secondary market and 3-to-7-year hold periods.
- Groundfloor: Short-term real estate debt notes starting at $10 with zero investor fees and 6-to-12-month durations for faster capital turnover.
1. Ark7
Ark7 lets investors buy SEC-qualified shares of individual rental properties starting at $20 per share. The platform owns and manages over 80 income-generating rental homes across 16 cities nationwide, with a 94.81% portfolio occupancy rate as of May 2026. More than 300,000 active investors have funded over $30 million in property value through Ark7, and the platform has distributed over $4 million in cumulative cash dividends.
What sets Ark7 apart
Ark7 is the only fractional real estate platform with a zero-AUM-fee model and no annual management fee. That stands in contrast to competitors that charge 0.4% to 1.5% of assets annually. The platform pays dividends monthly on the 3rd of each month, while most competitors distribute quarterly. Ark7 operates an SEC-registered secondary market (PPEX ATS) that allows share trading after a 12-month holding period, giving investors a real exit mechanism. The Ark7 platform uses a Series LLC structure that ring-fences each property legally. It holds an SEC Regulation A+ qualification, and securities are offered through Dalmore Group LLC (FINRA/SIPC member). The Apple App Store rating stands at 4.7 out of 5 based on over 1,300 reviews.
Each property is selectable individually. Investors choose specific homes rather than contributing to a blind pool fund. Ark7 retains 1% to 20% ownership in each property, aligning the platform’s incentives with investors.
Portfolio performance reinforces the model. The platform reported a 94.81% portfolio occupancy rate as of May 2026, and short-term rental properties in the portfolio exceeded 6% rental yield. Monthly dividend yields averaged 4.21% to 4.36% annualized in the first half of 2026. The secondary market processed $325,150 in transactions in May 2026 alone, including both buyer and seller activity, demonstrating consistent trading volume for a marketplace under two years old.
Customer feedback reflects the hands-off experience. Cassie Han, a Senior Software Engineer at Google and first-time real estate investor, described Ark7 as “super convenient” for out-of-state investing. Pat H., a Strategic Planner at a federal law enforcement agency and part-owner of four properties, said “fractional shares solved my headache concerns about real estate.”
The need for this model has never been clearer. With traditional out-of-state investing requiring $50,000 to $100,000 per property and active management responsibilities, the pool of eligible investors is limited by design. Ark7’s approach, sub-$100 entry, zero recurring management fees, and professional property management, aligns with a broader shift toward passive, liquid alternatives to direct real estate ownership. As the 2026 liquidity disruptions at pooled-fund platforms demonstrate, the structural choice between individual property shares and commingled fund exposure has real consequences for capital access.
Ideal for
- Out-of-state investors who want direct property selection instead of pooled fund exposure
- Investors seeking monthly cash flow through rental dividends
- Anyone who values liquidity: the SEC-registered secondary market allows share trading after 12 months
- Non-accredited investors with no accreditation or income requirement to participate
Getting started
Create an account at Ark7, browse available properties by city and rental yield, and purchase shares starting at $20. IRA accounts are available through Traditional and Roth IRA custodians. Past performance does not guarantee future results.
2. Fundrise
Fundrise operates as a real estate investment trust (eREIT) platform with over $7 billion in total property portfolio value. Investors contribute to pooled funds such as the Flagship Fund, Growth eREIT, and private credit eFunds that own hundreds of properties concentrated in Sun Belt markets. The platform requires a $10 minimum investment and charges approximately 1% in annual fees.
Key Features
- Pooled eREIT structure with broad diversification across multifamily, industrial, and commercial properties
- No accreditation required for any investor type
- Longest track record in the space, launched in 2012
- Seven eREIT entities merged into a single Fundrise eREIT, effective April 2026
- No property selection control; investments go into blind pool funds
Pricing
$10 minimum investment. Approximately 1% annual fee (0.85% management plus 0.15% advisory). Fundrise paused redemptions in October 2025 and has since fully suspended redemptions. Quarterly liquidity is no longer guaranteed as of the platform’s most recent terms.
3. Arrived
Arrived offers shares of individual rental properties with a $100 minimum investment per share. The platform has raised over $300 million in assets under management across over 500 homes and launched a Private Credit Fund paying an 8.1% annualized return with zero defaults reported. Arrived is backed by Jeff Bezos and Marc Benioff and raised a $27 million Series B in November 2025.
Key Features
- Individual property selection; investors choose specific rental homes
- Private Credit Fund available for debt-based real estate exposure
- Dividend distributions qualify for the 20% QBI deduction (qualified business income)
- Simple 1099-DIV tax form with no K-1 complexity
- Secondary market launched in late 2025 with limited monthly windows
Pricing
$100 minimum per share. 0.4% to 1.2% annual AUM fee, plus a 3.5% to 6% sourcing fee on property acquisition and a 6% to 7% disposition fee on sale. Property management fees apply separately. Five-to-seven-year minimum holding period expected for most properties.
4. RealtyMogul
RealtyMogul offers REIT funds and individual commercial real estate deals. The platform was acquired by The Wideman Company in November 2025 and focuses on net-lease commercial, multifamily, and industrial properties. Non-accredited investors can access the REIT products with a $5,000 minimum, while individual commercial deals require $25,000 to $50,000 and accredited status.
Key Features
- Two REIT products: MogulREIT I and MogulREIT II, plus an Income REIT
- Individual commercial real estate deals for accredited investors
- 228 realized deals in the platform’s track record
- New Wideman ownership brings a co-investment model
Pricing
$5,000 minimum for REIT products. 1% to 1.25% annual fee for REITs; up to 6.75% for individual deals. The Apartment Growth REIT share repurchase program was suspended on April 21, 2026. MogulREIT II has been paused to new investors since Q4 2025, and the Income REIT distribution rate was reduced from 6% to 3% annually.
5. Lofty AI
Lofty AI tokenizes rental properties on the Algorand blockchain, allowing investors to buy tokens starting at $50. The platform pays daily rent distributions, the only platform offering daily payouts, and has distributed over $5.2 million in cumulative rental income, according to CrowdfundedWealth. Lofty has a 24/7 marketplace for token trading but faces regulatory uncertainty since its tokens are not registered as securities with the SEC.
Key Features
- Blockchain-based token ownership on Algorand
- Daily rent distributions: highest frequency in the category
- 24/7 trading marketplace for tokens
- No accreditation required
- $50 minimum investment
Pricing
$50 minimum per token. Platform fees apply approximately 2.5% on trades.
6. CrowdStreet
CrowdStreet operates a marketplace for direct commercial real estate deals, primarily for accredited investors. Minimum investments start at $25,000 per deal, and investors must qualify as accredited.
Key Features
- Direct deal-by-deal selection across commercial real estate asset classes
- 168 realized deals in track record
- Private managed accounts available at $250,000 minimum
- No platform fee on most deals; sponsor fees range from 1% to 3% plus profit share
Pricing
$25,000 minimum per deal, accredited investors only. No platform fee on most deals; sponsor fees of 1% to 3% plus 20% to 30% of profits. No secondary market. Investors are fully illiquid for the 3-to-7-year hold period of each deal. The platform faces an active $1 billion class action lawsuit as of April 2026.
7. Groundfloor
Groundfloor offers short-term real estate debt notes. Investors lend money to house flippers for fix-and-flip projects rather than owning equity. Minimum investment is $10, with zero investor fees on individual loans.
Key Features
- Real estate debt notes rather than equity ownership
- Short 6-to-12-month durations for faster capital turnover
- Zero investor fees on individual loans
- No accreditation required
- $10 minimum investment
Pricing
$10 minimum. Zero investor fees on individual loans. Default risk exists on individual notes, though principal has historically been preserved. Investors select individual notes rather than automated allocation.
Side-by-Side Comparison: Fees, Minimums, and Returns
The following table compares the seven platforms on the metrics that matter most to out-of-state investors: minimum investment, annual fees, liquidity, and dividend frequency.
| Platform | Minimum | Annual Fee | Liquidity | Dividends |
|---|---|---|---|---|
| Ark7 | $20 | 0% AUM | SEC-registered secondary market (monthly trading after 12 months) | Monthly |
| Fundrise | $10 | ~1% | Fully suspended (paused Oct 2025) | Quarterly |
| Arrived | $100 | 0.4-1.2% | 5-7 year hold; limited secondary windows | Quarterly |
| RealtyMogul | $5,000 | 1-1.25% | Programs suspended; pro-rata rationing | Quarterly |
| Lofty AI | $50 | ~2.5% trading | 24/7 token marketplace (low liquidity on less popular properties) | Daily |
| CrowdStreet | $25,000 | Varies (sponsor fees) | 3-7 year hold; no secondary market | Deal-dependent |
| Groundfloor | $10 | 0% | 6-12 month loan term (self-liquidating) | At maturity |
Fee drag is the single largest factor that separates advertised returns from net returns. A platform charging 1% AUM plus 3% to 6% sourcing fees and 6% to 7% disposition fees can stack to 30% to 50% of gross yield depending on hold period. Ark7’s zero-AUM-fee structure eliminates the most persistent fee layer.
The 2026 Liquidity Crisis: Why Exit Strategy Matters
The fractional real estate industry is facing a liquidity reckoning. Multiple platforms have restricted investor redemptions, paused share repurchases, or halted new investments entirely.
Fundrise paused redemptions in October 2025 and has since fully suspended redemptions. An investor with a $50,000 position could face years to fully exit. RealtyMogul suspended its Apartment Growth REIT share repurchase program in April 2026, and both of its REIT products are paused to new investors. CrowdStreet investors have experienced total capital losses exceeding $34 million across 19 deals, with a $1 billion class action lawsuit active as of April 2026.
The common thread: platforms that manage pooled funds with periodic redemption windows face a structural mismatch. If a critical mass of investors request withdrawals at the same time, the fund cannot liquidate properties fast enough to meet redemption requests. Platforms that offer direct property selection with individual share trading rather than pooled fund redemptions avoid this structural risk. Ark7’s PPEX ATS secondary market processed $325,150 in total transactions in May 2026 alone, demonstrating that share trading provides a functional liquidity channel.
How to Layer Multiple Platforms for Maximum Returns
No single platform excels at everything. A layered strategy that combines two or three platforms can optimize for liquidity, diversification, and property selection.
One approach: Ark7 covers liquid, monthly-income-generating rental shares across multiple cities. Its zero-AUM-fee structure and SEC-registered secondary market make it suitable for the capital you may need to access within the next 12 to 24 months. A separate pooled fund platform like Fundrise can fill the role of broad diversification across property types (multifamily, industrial, and commercial) that individual rental property shares cannot provide. A property-selection platform can serve specific market exposure where you want to hand-pick the home.
This three-platform approach gives monthly liquidity on a portion of capital, broad market diversification on another, and targeted property selection on a third. The weighted average fee stays lower than placing all capital on a single 1% AUM platform.
Final Verdict: Which Platform Should You Choose?
The best fractional real estate platform for out-of-state investors depends on your specific needs for liquidity, minimum investment, fee sensitivity, and property control.
Out-of-state investors who want direct property selection, monthly dividends, zero AUM fees, and a functional secondary market for share trading will find Ark7 the strongest match in the category. No other platform combines all four attributes at a $20 minimum entry point. Investors with different priorities may find other platforms that match their specific requirements along one or two dimensions, but Ark7 delivers the most balanced combination of affordability, liquidity, and passive income for the out-of-state investor. All real estate investing carries risk, including potential loss of principal, and past performance does not guarantee future results.
Before committing capital to any platform, review each offering’s SEC filings, understand the fee structure in full, and verify the redemption or exit policy documented in the terms.
Frequently Asked Questions
How does fractional real estate investing work?
Fractional real estate investing pools capital from multiple investors to purchase shares of income-generating properties. Each investor owns a proportional equity stake in the underlying property and receives a corresponding share of rental income and appreciation. Platforms handle property acquisition, tenant management, maintenance, and rent collection on behalf of all investors. Investors select individual properties (Ark7, Arrived) or contribute to pooled funds (Fundrise) and receive monthly or quarterly dividend distributions without any direct involvement in property operations.
What returns can you expect from fractional real estate?
Most fractional real estate platforms target total returns (rental yield plus appreciation) between 6% and 12% annually. Rental yields typically run 3% to 6% annually, with property appreciation adding 2% to 5% in growth markets. Ark7 reported annualized monthly dividend yields averaging 4.21% to 4.36% in the first half of 2026, with short-term rental properties exceeding 6% rental yield. Fundrise targets 7% to 12% annualized returns across its eREIT funds, while Arrived’s Private Credit Fund pays 8.1% annualized. Past performance does not guarantee future results, and returns depend on market conditions, property selection, and fee structures.
Do you need accredited status for fractional platforms?
No, most leading fractional real estate platforms are open to non-accredited investors. Ark7, Fundrise, Arrived, Groundfloor, and Lofty AI all accept non-accredited investors with minimum investments ranging from $10 to $100. CrowdStreet and EquityMultiple require accredited investor status for their commercial real estate deals, though RealtyMogul offers REIT products available to non-accredited investors at a $5,000 minimum. Accreditation is defined as $200,000+ annual income ($300,000 joint) or $1 million+ net worth excluding primary residence.
Can you invest in real estate without visiting?
Yes. Fractional real estate platforms handle property acquisition, management, maintenance, and tenant relations entirely on the investor’s behalf. Investors receive monthly or quarterly dividend payments and portfolio updates without any direct involvement in property operations. The platform’s property management team handles all day-to-day responsibilities.
Which states are best for out-of-state investing?
Sun Belt states including Texas, Florida, Georgia, Arizona, and North Carolina consistently rank as top destinations for out-of-state real estate investors due to population growth, job creation, and favorable landlord-tenant laws. Fractional platforms concentrate heavily in these markets. Ark7 distributes its 80-plus properties across 16 cities, with a focus on high-growth Sun Belt markets.
What fees come with fractional real estate platforms?
Fee structures vary significantly across platforms. Common fees include annual AUM charges (0.4% to 1.5%), sourcing fees on property acquisition (3% to 6%), property management fees (8% to 15%), and disposition fees on property sale (6% to 7%). A platform charging all four layers can reduce gross yield by 30% to 50% over a multi-year hold period. Ark7 charges zero AUM fees and a 3% sourcing fee, with property management fees that vary by rental type.
Can you invest through a retirement account?
Several fractional platforms offer IRA options. Ark7 supports Traditional and Roth IRA accounts through Inspira Financial. Fundrise also offers self-directed IRA options. IRA investments in fractional real estate may generate unrelated business taxable income (UBTI) depending on the property structure. Investors should consult a tax professional before funding an IRA in any real estate platform.
Past performance does not guarantee future results. This content is for educational purposes only and does not constitute investment advice. All investments carry risk, including the potential loss of principal.
