Here’s How to Make Passive Income Through Real Estate Investments
Who doesn’t want to make passive income? Sure, making profits off of your hard work is great but making passive income is even better. With passive investing, you make money while others do all the work. There are plenty of opportunities for you to get involved with these investments. But how do you find opportunities like this? Here are two passive income options you should know about.
One option is a Real Estate Investment Trust ( REIT) which is a group of investors who pool their money together to buy real estate such as commercial property or luxury real estate. Each of the investors split the profit. The loan is structured by a fund manager. Trust and communication is very important when it comes to finding the right fund manager for you. You want a fund manager who has experience with trust deed investments and the real estate market as a whole. This approach is attractive because the fund typically gets the highest-yielding investments since it is being managed by a professional. If an originator must choose between investing in an individual trust deed or the fund, they will always choose the fund.
Another way to make passive income is to invest in a trust deed. This essentially means that you are lending y our money to an experienced investor who flips properties. This is called a first trust deed investment. These borrowers choose to get a nontraditional loan instead of going to a bank because traditional lenders have strict regulations and, even if they are approved, it can take weeks to get the financing. You and the borrower agree on the terms, payment, penalties, etc. then you make monthly passive income. In the event of a default, you take possession of the property and can sell it to recoup the initial investment. It’s safe, secured, and profitable.