7 Groundfloor Alternatives

When evaluating Groundfloor alternatives for real estate investment, the choice ultimately comes down to whether you need debt-based returns or equity ownership with appreciation potential. While Groundfloor offers short-term real estate loans with 7-14% target returns, many investors seek platforms providing both monthly income and long-term property value growth. This comprehensive guide examines the top Groundfloor alternatives, with particular emphasis on why Ark7 emerges as the superior choice for fractional real estate investing with liquidity, control, and cost efficiency.

Key Takeaways

• Ark7 leads as the top Groundfloor alternative – Offers unique secondary market liquidity, zero platform fees, and $20 minimum investments in specific rental properties
• Groundfloor focuses on debt investments – Provides 7-14% returns through real estate loans but with 4.71% uncured default rates and no equity upside
• Secondary market access defines Ark7 – Only platform offering share trading after 1-year hold period via SEC-registered PPEX ATS
• Cost efficiency is unmatched – Zero ongoing AUM fees versus 1% annual fees charged by Fundrise and Arrived
• Choose by investment goals – Ark7 for equity ownership with liquidity; Groundfloor for short-term debt; Fundrise for instant diversification

Understanding Groundfloor: A debt-focused crowdfunding platform

Groundfloor positions itself as a real estate debt crowdfunding platform that allows investors to fund short-term (6-24 month) real estate loans secured by property collateral. Serving over 250,000 investors with $2.2 billion+ funded since 2013, the platform combines low minimum investments with high target returns through its Loan Reservation Offerings (LROs).

Key Groundfloor Strengths:

• Lowest absolute minimum at $10 per loan investment
• Short-term investment options with 6-24 month loan terms
• High yield potential with 7-14% target returns on loans
• No investor fees – borrowers pay all platform costs

Significant Limitations:

• High default risk with 4.71% uncured default rate and 0.94% historical loss rate
• No equity participation – debt-only model misses property appreciation upside
• Complete illiquidity – cannot exit loans early; must wait for borrower repayment
• Transparency issues – investor complaints about delayed default reporting
• No bankruptcy protection – lacks bankruptcy-remote safeguards unlike competitors

With its debt-focused approach, Groundfloor serves investors seeking short-term returns but leaves equity-minded investors looking for platforms offering both income and appreciation potential.

Top 7 Groundfloor Alternatives Ranked

1. Ark7: The best overall alternative for fractional real estate equity

Ark7 revolutionizes real estate investing by offering fractional equity shares in individual rental properties with unique secondary market liquidity. With 220,000+ investors and $23 million+ in property value funded, Ark7 enables investors to build wealth through high-yield rental homes with as little as $20 per share while maintaining full operational transparency.

Key Ark7 Advantages:

• Lowest minimum for equity – $20 per share vs. Arrived’s $100 and RealtyMogul’s $5,000
• Traditional LLC ownership structure – no cryptocurrency, blockchain, or complex tech requirements
• Debt-free property options – unique risk reduction feature among fractional platforms
• Monthly income reliability – consistent distributions on the 3rd of each month
• Balanced liquidity timeline – 1-year hold period then access to PPEX ATS secondary market
• Individual property selection – choose specific assets with full underwriting transparency
• IRA eligibility – tax-advantaged investing via Inspira Financial partnership

Liquidity and Control Capabilities:

Unlike Groundfloor’s illiquid debt model, Ark7’s fractional equity ownership provides both monthly cash distributions from actual rental income and potential property appreciation. The platform’s secondary market enables investors to sell shares after a 1-year holding period, addressing the biggest limitation of traditional real estate crowdfunding platforms.

Proven Performance:

Ark7 delivers consistent returns backed by actual rental income and property value growth.

Integration Ecosystem:

Ark7’s mobile app provides a seamless investment experience with full property browsing, share purchasing, and portfolio management capabilities. The platform also supports IRA investing through Inspira Financial, enabling tax-advantaged real estate investments with the same $20 minimum and liquidity benefits (note: Inspira Financial charges an annual custodian fee).

2. Fundrise: The instant diversification alternative

Fundrise serves as the largest private market real estate platform, offering REIT-style pooled funds that provide instant diversification across dozens of commercial and residential properties. Operating since 2012 with the longest track record in the industry, Fundrise delivers fully automated, hands-off real estate investing.

Key Fundrise Advantages:

• Lowest $10 minimum investment – most accessible entry point in the industry
• Automatic diversification – fund-based model spreads risk across multiple properties
• Longest track record – 12+ years operating with $194M in dividends paid
• IRA support available – tax-advantaged investing with $1,000 minimum

Limitations to Consider:

• No property selection – fund-only model prevents choosing specific assets
• Limited liquidity – quarterly redemptions with penalties and processing delays
• Lower current yields – recent dividend yields vary
• Customer service complaints – email-based support criticized for slow response times

Fundrise represents a solid choice for investors prioritizing instant diversification and hands-off management, but it lacks the property selection control and liquidity that Ark7 provides.

3. Arrived: The property selection alternative without liquidity

Arrived serves as a major fractional rental property platform allowing investors to choose specific homes for investment, similar to Ark7’s property selection model. With a large user base and established track record since 2019, Arrived offers equity ownership in individual rental properties.

Key Arrived Advantages:

• Vacation rental focus – unique dedicated short-term rental property category
• Individual property selection – choose specific assets like Ark7
• Monthly/quarterly income options – flexible distribution schedules
• National property coverage – diverse geographic exposure

Significant Limitations:

• Higher minimum investment – $100 per property versus Ark7’s $20
• Relatively high fees – Multiple fee layers including 3.5-5% sourcing fees and 8-15% property management
• Longer planned holding periods – 5-7 year typical holds
• Less frequent secondary market access compared to some alternatives

Arrived provides property selection similar to Ark7 but lacks the critical secondary market liquidity that makes Ark7 superior for investors needing exit flexibility.

4. RealtyMogul: The commercial real estate alternative

RealtyMogul stands as an established platform offering both REIT options for non-accredited investors and private placements for accredited investors, with a focus on commercial real estate including office, retail, and industrial properties. With 300,000+ investors since 2012, RealtyMogul provides institutional-grade real estate access.

Key RealtyMogul Strengths:

• Established track record – Operating since 2012 with proven performance
• Institutional-quality deals – Access to larger commercial properties
• Professional underwriting – Rigorous property selection and due diligence
• Diversified offering types – Debt and equity investment options

Significant Limitations:

• High minimum investments – $5,000 for REITs, $25,000+ for private placements
• Mostly accredited-only – Best deals restricted to accredited investors
• Commercial property focus – Different risk profile than residential
• Less frequent distributions compared to residential rental platforms

RealtyMogul excels for accredited investors seeking commercial real estate exposure but presents high barriers to entry for retail investors compared to Ark7’s $20 minimum.

5. EquityMultiple: The institutional-grade alternative

EquityMultiple serves as an institutional-grade commercial real estate platform offering sophisticated investment opportunities primarily for accredited investors. With a focus on commercial and multifamily properties, EquityMultiple provides access to larger, institutional-quality deals.

Key EquityMultiple Advantages:

• Commercial real estate focus – specialized exposure to business properties
• Institutional underwriting standards – rigorous deal selection process
• Professional asset management – experienced operators managing properties
• Diverse investment structures – debt and equity opportunities

Platform Limitations:

• Accredited investors only – Not accessible to non-accredited investors
• Complete illiquidity – No secondary market or early exit options
• Long hold periods – 5-10 year investment horizons
• Limited transparency – Less detailed property-level information

EquityMultiple serves accredited investors seeking institutional real estate exposure but lacks the accessibility and liquidity that makes Ark7 suitable for all investor types.

6. Yieldstreet: The alternative asset diversification platform

Yieldstreet offers a diversified alternative asset platform including real estate, marine finance, legal finance, and art investments. With real estate representing one component of a broader alternative asset strategy, Yieldstreet provides portfolio diversification across multiple asset classes.

Key Yieldstreet Strengths:

• Alternative asset diversification – Real estate plus marine, legal, art, and other assets
• Institutional partnerships – Access to institutional-quality deals
• Professional management – Experienced asset management teams
• Established platform – Operating since 2015 with strong track record

Significant Limitations:

• Higher minimum investments – about $10,000+ minimum per investment
• Complex fee structure – varying fees by asset class with less transparency than real estate specialists
• Limited real estate focus – real estate is just one component of broader alternative asset platform
• Quarterly distributions only – less frequent income than monthly alternatives
• Less property-level transparency – limited visibility into specific real estate holdings

Yieldstreet provides alternative asset diversification but lacks the real estate-specific focus and accessibility that Ark7 offers to all investors.

7. Streitwise: The REIT-focused alternative

Streitwise specializes in commercial real estate REITs focusing on office properties in growth markets. With a simplified 1% all-in fee structure and $1,000 minimum investment, Streitwise offers straightforward commercial real estate exposure through a REIT structure.

Key Streitwise Advantages:

• Simple fee structure – 2% annual management fee
• Commercial real estate focus – Specialized in office properties
• Quarterly dividends – Regular income distributions
• Professional management – Experienced commercial real estate team

Platform Limitations:

• High minimum investment – $1,000 minimum investment, based on share pricing 
• No direct property selection – REIT structure provides no control over specific properties
• Limited liquidity – No public secondary market; redemption requests subject to approval
• Primarily commercial office exposure – No access to residential rental properties
• REIT structure limitations – different transparency dynamics than direct property ownership

Streitwise provides simple commercial REIT exposure but lacks the residential property access, low minimums, and liquidity that make Ark7 superior for most investors.

Why Ark7 stands out for fractional real estate equity

Ark7’s dominance in fractional real estate equity stems from several unique advantages that directly address the limitations of Groundfloor and other alternatives. The platform’s secondary market liquidity ensures investors aren’t locked into 5-7 year holds like Arrived or Fundrise, providing crucial exit flexibility after just 1 year.

Zero platform fees represent Ark7’s cost advantage, eliminating the 1% annual AUM fees charged by Fundrise and Arrived. This fee elimination translates to approximately $100 annual savings on a $10,000 investment, significantly improving net returns over time.

The lowest minimum investment of $20 enables micro-diversification across multiple properties with minimal capital, making real estate investing accessible to investors of all income levels. This contrasts sharply with RealtyMogul’s $5,000 minimum or EquityMultiple’s $25,000+ requirements.

Property selection control empowers investors to choose specific properties based on location, type, and performance metrics rather than being forced into blind pooled funds like Fundrise. This control, combined with Ark7’s retention of 1-10% equity in each property, ensures true alignment of interests between the platform and investors.

Specific use cases where each platform excels

Choose Ark7 when:

• Seeking fractional equity ownership in specific rental properties with $20 minimum investments
• Requiring secondary market liquidity after 1-year hold period
• Wanting to avoid ongoing AUM fees that reduce net returns
• Needing both monthly rental income and property appreciation potential
• Investing through an IRA account with the same low minimums and liquidity benefits
• Preferring the convenience of a mobile app for property discovery and management

Select other platforms for:

• Short-term debt investments with 6-24 month terms (Groundfloor)
• Instant portfolio diversification across dozens of properties (Fundrise)
• Commercial real estate exposure with higher minimum investments (RealtyMogul, EquityMultiple)
• Alternative asset diversification beyond just real estate (Yieldstreet)
• Simple commercial REIT exposure with higher minimums (Streitwise)

Technical capabilities showdown

Investment Structure:

• Ark7: Fractional equity shares in individual properties with secondary market liquidity
• Groundfloor: Debt-only loans with no equity participation or liquidity
• Fundrise: Pooled REIT funds with no property selection or true liquidity
• Arrived: Fractional equity without secondary market liquidity
• Commercial platforms: REITs or private placements with high minimums and poor liquidity

Fees and Minimums:

• Ark7: $20 minimum, 3% acquisition fee, zero ongoing AUM fees
• Groundfloor: $10 minimum, zero investor fees
• Fundrise: $10 minimum, 1% ongoing AUM fees
• Arrived: $100 minimum, 3.5-5% acquisition + 1% annual fees
• Commercial platforms: $1,000-$25,000+ minimums with 1%+ annual fees

Liquidity and Control:

• Ark7: Secondary market after 1 year, specific property selection
• Groundfloor: No liquidity, specific loan selection only
• Fundrise: Limited redemption after 5 years, no property selection
• Arrived: No liquidity, specific property selection
• Commercial platforms: No liquidity, limited or no property selection

Performance and Risk:

• Ark7: Consistent returns with equity appreciation potential and lower default risk
• Groundfloor: 9.91% overall returns with 4.71% uncured default rate and no appreciation
• Fundrise: 5.75% returns in 2024 with instant diversification but no control
• Arrived: 5.14% 12-month returns with property-specific risk and no liquidity
• Commercial platforms: Varies by deal with higher minimums and longer hold periods

Making the Right Choice

Selecting the ideal Groundfloor alternative depends on your specific investment goals, risk tolerance, and liquidity needs. Ark7 emerges as the clear winner for investors seeking fractional real estate equity with the unique combination of secondary market liquidity, zero platform fees, low minimum investments, and property selection control.

For investors prioritizing both income and appreciation potential while maintaining exit flexibility, Ark7 provides the optimal balance of accessibility, control, and cost efficiency. The platform’s proven track record with 220,000+ investors, transparent fee structure, and mobile-first experience ensure successful real estate investing without the landlord responsibilities.

The future of real estate investing is fractional, liquid, and accessible, and Ark7 leads the charge in democratizing high-quality rental property ownership for every investor. Start building your real estate portfolio today with as little as $20 and join the growing community of investors who’ve chosen Ark7 for their fractional real estate needs.

Frequently Asked Questions

What makes Ark7 a good alternative to Groundfloor?

Ark7 offers fractional equity ownership in specific rental properties with both monthly rental income and property appreciation potential, unlike Groundfloor’s debt-only model. Ark7 provides unique secondary market liquidity after a 1-year hold period, zero ongoing platform fees, and a $20 minimum investment. While Groundfloor offers higher target returns of 7-14%, it comes with a 4.71% uncured default rate and no equity upside. Ark7’s equity model allows investors to benefit from property value growth while maintaining greater exit flexibility through its trading platform.

Can I invest in real estate through an IRA on platforms like Ark7?

Yes, Ark7 supports IRA investing through Inspira Financial, allowing you to use Traditional or Roth IRA funds to purchase fractional shares in rental properties. The same $20 minimum investment and secondary market liquidity apply to IRA accounts, making it one of the most accessible IRA real estate investment options available. This enables investors to build tax-advantaged real estate portfolios with the same property selection control and low barriers to entry as standard Ark7 accounts. Note that Inspira Financial charges annual custodian fees for their services.

What are the minimum investment requirements for fractional real estate?

Minimum investment requirements vary significantly by platform, with Ark7 offering the lowest minimum for equity ownership at $20 per share. Arrived requires $100, Fundrise accepts $10 but only for pooled funds without property selection, and commercial platforms like RealtyMogul require $5,000 or more. Groundfloor offers the lowest absolute minimum at $10, but this is for debt investments only with no equity participation or appreciation potential. The lower minimums on platforms like Ark7 enable investors to diversify across multiple properties with minimal capital.

How does the secondary market for real estate shares work on platforms like Ark7?

Ark7’s secondary market operates through the SEC-registered PPEX ATS, allowing investors to sell shares after a 1-year holding period. This provides crucial liquidity that other platforms lack, as Arrived and most competitors offer no secondary market while Fundrise has limited redemption options with penalties. The secondary market enables investors to exit positions without waiting 5-7 years for property sales, making real estate investing more flexible and accessible. However, liquidity depends on buyer demand, and there’s no guarantee shares will sell immediately at desired prices.

What are the risks associated with investing in private real estate offerings?

Investing in private real estate offerings involves substantial risks including illiquidity, lack of diversification, and potential complete loss of capital. Groundfloor’s 4.71% uncured default rate demonstrates the specific risks of real estate debt investments, while individual property investments carry location-specific and tenant-related risks. Market downturns can reduce both rental income and property values, affecting returns and making exits difficult. Investors should carefully review the applicable offering circular for comprehensive risk disclosures and consider their ability to hold investments for extended periods, as secondary market liquidity is not guaranteed.