How to Create Passive Income from Real Estate Investing [2022]

Investing in real estate comes in many flavors with varying degrees of time, effort, commitment and investment. Real estate investing offers opportunities for both passive and active income which you can start making consistently and quickly when done properly. 

Some ways you can invest in real estate involve more risk than others.  Your options will depend on your level of capital available, time availability, investment time horizon, among other factors.

Should You Invest in Real Estate?

Pick the real estate income opportunity (or opportunities) that match your current budget and level of risk aversion.

How to Make Passive Income from Real Estate Investing

The most common method for real estate investing when considering the investment opportunity is from directly purchasing a property and renting it out to tenants. 

1. Direct Ownership and Management (or with 3rd-Party)

With short-term rentals, you can often charge more on a nightly basis than you would with longer-term tenants and you don’t need to spend time chasing down rent. If you use a third party, such as Airbnb, for short-term rentals of a property you already own, you can earn money relatively passively. 

2. Short-Term Rentals

People who invest in REITs receive dividends in the same way you receive dividends from certain stocks and these returns are usually higher than most other stocks.

3. Real Estate Investment Trusts (REITs)

Another way to create passive income through real estate is by creating or purchasing a mortgage note. You can buy performing and non-performing mortgage notes from other investors, commonly with a small discount. 

4. Mortgage Notes

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