EVALUATION OF ADOPTION OF CROWDFUNDING PLATFORMS FOR REAL ESTATE INVESTMENT IN AKURE, NIGERIA

Purpose: The study identified the forms of real estate crowdfunding platforms in the study Akure; evaluated the level of their adoption and examine the factors influencing the level of adoption of different forms of real estate crowdfunding in the study area.

Design/methodology/approach: In order to achieve this, forty-seven (47) questionnaires were administered to registered estate firms (35) and estate developers (12) in the study area out of which twenty-five (25) and six (6) were retrieved respectively. Overall, a total of 31 questionnaires representing 66% general response rate was achieved and found adequate for further analysis. The questionnaires were analyzed using weighted mean score analysis, relative importance index (RII) and logistic regression analysis.

Findings: The study revealed that real estate crowdfunding platforms viz reward-based crowdfunding is the most recognized with the mean of 2.48 while the hybrid model has the least familiarity with a mean-score of 2.13. The study further revealed that debt-based, donation-based and equity-based crowdfunding platforms has the highest adoption rate with a mean of (2.39) respectively, followed by reward-based crowdfunding platform with a mean of (2.32) while the hybrid model offers the lowest mean of adoption (2.13). Finally, the study found that portfolio diversification has the most valued benefit with relative importance index (RII) of 0.741935 followed by passive income generation, real estate deals and quicker dealings while professional property management, less paper work, availability of prime real estate and lower entry barrier in terms of amount of investment are less beneficial to an investor amongst other findings.

Research limitations/Implications: The rapidly evolving nature of technology platforms like crowdfunding may limit the applicability of some findings over time. The contribution to knowledge is that the study provides insight that real estate crowdfunding platforms can increase real estate investment opportunities for a broader audience contributing to financial inclusion.

Practical implications: Real estate crowdfunding platforms can be utilized by real estate developers/estate firms to diversify funding sources and thereby deepen risk sharing and diversification.

Originality/value: The study highlights strategies for promoting real estate crowdfunding platforms as a viable financing option for real estate development.