REITs are essentially companies that own real property or hold the mortgages for properties.

If you’re looking for a hands-off, extremely passive investment option, real estate investment trusts (or REITs) may be the way to go. You will also need to account for tourist trends and seasonal vacancies. Costs include the usual homeownership expenses (repairs, updates, insurance, etc.) as well as management costs, rental platform fees and housekeeping services. In some cases, it may pay for itself, your vacations there and then some. These properties can be purchased in areas that you and your family already enjoy visiting, allowing you to use the home certain weeks out of the year and rent it out the rest of the time. You will likely need to consider the costs of property management, security and insurance.Ī vacation property can be a fun and lucrative option for generating passive income.

Your revenue will depend on the number of units you own, as well as factors such as climate control and customer access. With multiple units and relatively-low overhead, storage facilities can be a great way to generate passive income. As with multi-family properties, these investment properties can be more streamlined in some ways and increase the potential for passive revenue income.Īpartment buildings also require a much more involved management process, however you may want to hire a property manager to find tenants, collect rent and facilitate repairs, all of which can affect your revenue.īoth urban and rural communities can benefit from storage unit facilities, which are in demand in nearly every populated area of the country. If you’re looking at a larger passive income scale, apartment buildings - which include properties with five units or more - may meet your needs. However, it also means managing multiple leases, tenants and potential vacancies at the same time. It also allows you to spread the risk of a vacancy out over multiple units, buffering the financial impact. This can be easier in some ways ( one mortgage, one property tax bill, etc.), and it generates more revenue than a single-family property. These units allow you to generate income from multiple tenants while only managing one physical property. However, they can also be risky, as turnovers and vacancies equate to income lost for landlords.Īnother option for rental property is the multi-family unit, such as a duplex, triplex or quadplex. This provides both long-term asset growth and, in many cases, additional monthly revenue.Īn SFH is one of the most common choices for real estate investment. These properties can be purchased and then rented out to a single tenant, a couple or even a family.

Here are a few real estate investment options to consider.Ī single-family home, or SFH, is an individual, standalone rental property, such as a house or even a condo unit. The one you should choose will depend on your level of experience, your available cash flow and the time you can afford to dedicate to your investment. There are many different avenues to choose from when considering passive income real estate investments. These passively earned funds can be used to boost your savings accounts, pay off debt, save for your kids’ college, achieve financial independence or even provide income throughout your retirement. Essentially, you are able to earn money while you work your 9-to-5, while you sleep and even while you’re on vacation with your family.

While the actual level of involvement will vary from one investment to the next, the idea is that once your real estate investments are established, they can generate revenue on their own. And that’s not even to mention the toll that non-stop work would take on your mental, emotional and household health. Whether you work on salary, make an hourly wage or even have a side hustle that earns extra money, you will eventually run out of hours in the day in which you are able to generate more income. No matter your career, your income is inevitably limited by time. Some may purchase and manage rental homes while others might opt to invest in commercial properties. Investors can utilize various real estate options to generate this passive income.

Beginner passive income