Are you searching for tips on how to create passive income with real estate investing?
Now is the perfect time to invest in real estate, especially if you want to avoid continued stock market losses and place yourself in a position where you can protect your net worth from future economic instability.
In this article, I’ll break down several strategies that you can utilize to start earning passive income from Real Estate.
How To Create Passive Income With Real Estate Investing
In 2020, more people are storing their overflow items in storage facilities across the United States than ever before.
It doesn’t matter the city or state that you live in, self-storage facilities are a common sight and they can be very profitable because the average monthly rent of a self-storage facility is $50. This means that if you have 100 units at your self-storage facility, you can easily be earning $5,000 per month in passive income from Self Storage.
The key to success with managing a self-storage facility all boils down to hiring someone to manage that facility for you because, if you’re spending more than a couple of hours per month managing it then it ceases to be passive income, and becomes a second or third job.
Mobile Home Parks
Another excellent way to earn passive income from real estate investing is by investing in mobile home parks.
Like self-storage facilities, mobile home parks can be found in most major cities across the United States.
Many renters prefer living in mobile home parks because they offer the convenience of living in a home without having the same responsibilities of homeownership while the water, sewer, and trash are paid for by the mobile home park.
The great thing about mobile home parks is that depending upon location, it’s quite possible to invest in a mobile home park for under $500,000 and if the park has 15 to 30 units, you can easily be earning upwards of $10,000 or more per month in passive income from one Mobile Home Park.
Mobile home parks often get a bad rap because many owners have neglected them over the years and let the quality of the trailers that they have in their mobile home parks decline. Don’t let this happen to you, they are a great way to enjoy passive income with real estate investing if you take care of your trailers!
If you focus on keeping the trailers in your mobile home park in excellent shape, as well as keeping the landscaping maintained, you’re going to preserve the value of your mobile home park while showing your tenants that you care and are not just a ‘slumlord’.
Land is one of the oldest and time-tested real estate Investments to date because, it’s something that’s in short supply so if you have the opportunity to invest in land in your state, or elsewhere across the United States, you should take the opportunity to invest in land because you never know what that land could be used for in the future.
Before investing in just any land parcel, research is the key to success with land investing. You should take the time to research the area where the land lot is located to determine if it’s an up-and-coming area that could be developed sometime in the near future.
Real Estate Investment Trusts (REIT’s)
Another excellent way to earn passive income from real estate investing is by investing in a Real Estate Investment Trust.
Many investors prefer to get started with investing in real estate investment trusts because it gives them the ability to essentially get their feet wet by investing in real estate, without actually holding property or having to manage it.
Like dividend stocks, real estate investment trusts pay out dividends on an annual or quarterly basis. Before investing in a REIT, you should take the time to thoroughly research its management team, then learn how you would be compensated, before you invest your money with a specific Real Estate Investment Trust.
If your goal as an investor is to enjoy passive income with real estate investing, you may also want to consider investing in tax liens and mortgage note investing because, these are also excellent ways to be involved with real estate without actually having to hold or manage properties yourself.
Last, of all, my favorite method for earning passive income from real estate investing is by investing in multifamily properties.
The great thing about multifamily investing is that there are more multi-family properties out there than ever before.
If you are a new investor, and you are also open to the possibility of ‘house hacking’, you may want to consider investing in a fourplex. Doing this will enable you to qualify for FHA financing so that you could have the opportunity to live in one of the units while renting out the other three units in the building.
Let’s say that you didn’t want to opt for house hacking, no problem, you should consider investing in a small apartment building as your first multi-family investment.
Before investing in just any apartment building, make sure you do your due diligence and take the time to thoroughly research the area where the apartment building is located.
Besides researching the local rental market, you should investigate the local jobs market, crime rate, and School Districts because your goal as a real estate investor should be to first and foremost invest in a property where you can potentially see yourself living there.
After doing your initial due diligence, the next thing that you should do is research the competing supply of other multifamily properties in the area. Once you do this it’s also important to analyze new construction permits because this will help you to have a bigger picture to see if other multifamily properties under construction that could compete with your property when they are finished in the years to come.
The next thing to do on your due diligence checklist is to investigate area vacancy rates. This is important because, if the area vacancy rate is more than 8%, this means that the area could need repositioning or renovation so it’s best to tread carefully before deciding to invest there.
Last of all, but most important, another thing that you should do before investing in a multi-family property is to verify if there are any value-add opportunities with that property.
This means that you want to specifically be looking for things that you can do to earn passive income with real estate investing every month like adding vending machines, a laundry room, premium parking spaces, or other premium options like high-speed internet that will attract tenants to the property who would be willing to pay for those premium services.
Contact Trier Capital
At Trier Capital, 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.
Why invest in multifamily properties yourself? Our simple step-by-step process allows you to accelerate your wealth creation so you can live a magnificent life on your own terms, whether that means traveling the world, spending more time with family and friends, or making an impact.
To learn more about the benefits that come with partnering with my company, contact me today by calling (630) 229-2383 or click here.