Are you interested in getting started with earning passive income through real estate investing?
Real estate investing is still one of the best ways to earn passive income in 2020 even though we’ve had a bouncy year economically including the start of the economic recession, stock market crash, and job losses. Why? The answer to this question can be answered in one simple word: demand.
Demand for rental properties has never been higher because there’s never been a greater barrier to entry for some people to get started with owning homes, so most focus on renting properties instead of buying.
Besides a large number of people choosing to rent a home instead of buying real estate, renting is also more popular across more generations including Millennials, Baby Boomers, Generation X, and Generation Z, compared to younger generations like years past.
When you combine the demand for Real Estate, along with the changing attitude that most people have towards renting, this makes 2020 one of the best years to buy real estate but the big question is how can you earn passive income from it?
In this article, I’ll answer this question and provide you with tips for getting started with earning passive income through real estate investing
Earn Passive Income From REIT Dividends
The first way to earn passive income from real estate investing is by investing in real estate investment trusts.
A REIT is a public company that manages multiple residential and commercial real estate properties.
What’s great about investing in real estate investment trust is that they are required by law to pay out up to 90% of their taxable income to their shareholders.
As with stocks, a real estate investment trust will pay out their dividends on a quarterly or annual basis. This means that you only have to invest in a Real Estate Investment Trust one time, and then you can expect to continue to earn passive income from the REIT for as long as you are invested in it.
Many people typically choose a real estate investment trust as a way for them to get started with real estate investing because with a REIT, the investor doesn’t have to manage the properties that they are invested in.
This saves an investor the traditional headaches that can come from owning rental properties because they don’t have to worry about things like rent collection, maintenance, customer service, or marketing their properties.
Besides a real estate investment trust, some of the other ways that you can earn passive income from Real Estate include investing in land, crowdfunding, and purchasing mortgage notes.
Keep in mind that the goal with creating passive income is to not spend more than a couple of hours per month on maintaining a passive income stream. The more time that you spend working on that income stream every month, it stops being passive income and essentially turns into another job.
Invest In Multifamily Rental Properties
If you’ve been reading this blog for any length of time, or if it’s your first time here, you know that my preferred method for earning passive income is by investing in multifamily property.
In this day in age, there’s always going to be Real Estate Investors who will tell you that their preferences for investing in real estate is single-family, while others will say that their preference is investing in multifamily properties.
The reason why I prefer multifamily properties over single-family properties is because of the economy of scale.
With a multi-family property, you can easily have hundreds of doors under of roof, compared to only being able to own just one door if you invest in a single-family property.
The great thing about multi-family properties is that not only do you have all of your sources of income under one roof, you also can consolidate your maintenance costs as well. You also won’t lose money during vacancies because when one unit is vacant, there’s always going to be other units in your building that are occupied.
How to find your first deal – Thanks to the Internet, it’s never been easier to find multifamily deals across the United States because you can easily search for properties online, especially when you connect with other investors utilizing websites like Bigger Pockets.
If you plan on investing in a multifamily property that’s not in your city or state, you should consider hiring bird dogs, or a local real estate agent, who can help you find multi-family properties for sale in the area that you want to invest in
Location, location, location – If you have studied real estate in the past, you know that location is the key to success when purchasing a residential or commercial property. Why? The obvious reason why location matters is the location of the property that you buy may ultimately affect it’s resale value.
Do Your Due Diligence – Last of all, but most important, always remember to do your due diligence before investing in a new multi-family property. Due diligence is important because this is what’s going to save you the time, money, and hassle of potentially investing in a multifamily property that will only end up costing you more time, money, and effort than what it’s worth.
Let Me Save You The Time And Hassle Of Investing In Multifamily Properties
After reading this far, you may still be excited about investing in multifamily properties but hesitant at the same time because of the commitment that it takes to getting started.
Thankfully, my company can save you the time and hassle of getting started with investing in multifamily properties. We can help you build a portfolio of passive income-generating properties without you having to do any of the work yourself.
We do all the hard work to find and acquire ideal properties, and then oversee asset management after purchase, while our investors sit back, relax, and receive tax-advantaged passive cash flow.
To learn more about the benefits that come with investing in multifamily properties, or to speak with me about getting started with investing in your first property, contact me today by calling (630) 229-2383 or click here to connect with me online.