Doorvest is a company that believes you should reach financial independence. They encourage this by allowing you to invest with them in an asset class that’s usually reserved for wealthier folks, that is, real estate.
What is their real estate of choice? Single-family rental homes. Now if that’s something that piques your interest, we’re here to talk about it. We’ll be covering all the details, along with pros and cons of investing with Doorvest. In the end, we’ll give you our honest opinion on whether investing with Doorvest is right for you.
What is Doorvest?
Doorvest is a digital platform that aims to make real estate investing as simple and efficient as possible.
They offer two main services:
- They help you purchase a SFH that they then help manage for a fee
- They can buy your home off you with a cash offer, even if you’ve got a remaining mortgage on it
When we talk about Doorvest as a company, it’s best to dig into their philosophy, which they’re quite clear about. Their goal is to align their interests with yours, and to hopefully bring you into a partnership where you can both benefit.
The first interest you’ll need in order to jive with Doorvest is an interest in real estate investing. Historically, home prices have always gone up in the long run. There aren’t many who would argue against the value of investing in a home.
Secondly, Doorvest believes in investing in single-family homes specifically. These kinds of homes are always needed, as people buying a home for their family almost always look first into single-family properties. It’s overall quite rare for a family to be looking into multi-family units, though it does happen on occasion.
Lastly, Doorvest takes advantage of technology to be able to partner with multiple would-be and current homeowners in the most convenient manner possible. They charge a single fee and take care of renovations, tenancy, and rental payments. You are able to monitor all progress via their online dashboard.
Of note, Doorvest also has a program that offers cash for your home without the need for showings, repairs, or extra fees such as realtor commissions. This can save you upwards of 6% from the get-go. Offers come quite quickly at less than 24 business hours from initial contact. Additionally, should you decide to close, you’ll see the funds deposited into your account within 24 hours of closing. You can sell homes in which there is still a mortgage remaining on it as well.
How do you qualify for Doorvest?
To qualify to use Doorvest, you simply need to either:
- have a single-family home that you’d like to sell
- or be interested in purchasing a single-family home for Doorvest to help you manage
On top of those, you could even still have a remaining mortgage and they will still purchase your home from you, provided everything else looks good from their end. There is no minimum credit score to qualify or anything like that. It really is that simple.
Doorvest pros and cons: The pros
- The company is quick in everything they do, whether it be cash offers, closing, or answering questions
- Saving up to 6% on commission fees is no small savings depending on the value of your home, and they buy homes as-is
- For rental properties, they take care of renovations and repairs for the first year
- Dashboard is intuitive and helpful in giving you an overview of your cashflow and transactions
Doorvest pros and cons: The cons
- The 10% management fee is steep compared to other companies you can find locally
- Some homeowners may feel bad that current tenants cannot simply stay upon sale of the home, despite Doorvest acting as a property manager for rentals
How much does Doorvest cost?
There is only one fee when you’re partnering with Doorvest, and that’s the management fee. The management fee is 10% of the monthly rental income generated by your property. What happens if the property is vacant for the month? Well, you’ll still technically pay 10%, but 10% of $0 is still $0. There is no minimum fee set by Doorvest in cases like these.
Is Doorvest legit?
Doorvest is indeed a legit company that has raised $14 million from investors and capital firms such as Adam Nash, Marcus Ridgway, M13, Mucker Capital, and Pollen Street Capital. The company is similarly run to other more established platforms such as Fundrise, BuyProperly, and Rubik.
Can I make money with Doorvest right away?
According to the math on Doorvest’s website, you would need to expect to lose money for the first few years. Real estate investing is a long game; you cannot expect to make money right away, especially in this market.
In conclusion: Is Doorvest worth it?
If you can get over the 10% management fee, we certainly like everything about Doorvest, including the fact that they are involved with everything from beginning to end. For purchasing a SFH rental property, they’ll help you scout out potential listings, acquire it for you, and help get it transferred to your name. They then take care of tenancy and pay you what you’re owed.
As for selling a home with them, it’s super convenient and you don’t have to worry about a 6% commission fee. Depending on the price of your home, that could add up to tens of thousands of dollars saved in your pocket.