6 Savvy Ways To Get Rich off Real Estate (Without Being a Landlord)

Many people see investing in real estate as the perfect way to generate passive income while working towards other goals. Becoming a landlord often seems like the easiest way to do this since you don’t need too much experience to get started.

But, even with all the perks that come along with being a real estate tycoon, you may find that you don’t want to deal with all of the responsibilities that being a landlord entails.

Fortunately, there are alternatives that offer similar benefits that don't require you to be on call to deal with those overnight maintenance issues. If you want to start investing in real estate but are not quite ready to become a landlord, you may want to consider these six alternative options.

For those who don’t want to deal directly with renters but still want the benefits of owning an investment property, there’s the option of hiring a property manager or property management company.

These professionals can handle the day-to-day operation of managing a rental property, all while keeping both the tenants and the owners happy.

The downside to this arrangement is that you’ll have to pay for the property management services, which can dig into your monthly profits.

Another possible way to profit from real estate involves investing in a private equity fund. These broad spectrum investment options offer a lot of flexibility, since they use investor money in a variety of ways, including financing property flips and developing new properties.

Of course, there are varying levels of risk with this option, and buying an existing property with a long-standing tenant who pays on time each month can be less risky than financing a rehab with an unknown future, so it’s important for anyone considering this option to do their research first.

Thanks to HGTV, most people are familiar with house flipping. This process involves purchasing a home outright, investing additional funds to renovate and upgrade the property, and then selling it to a new owner at a profit.

House flipping may be a more appealing option for savvy folks who are handy with a hammer or those who can afford to hire reliable contractors who can do the job for you. Just remember, house flipping isn’t without its risks, and it can be easy to get in over your head if you’ve never attempted something like this before.

Real Estate Investment Trusts (REITs) allow investors to own shares of a profitable real estate company without requiring you to get involved in the nitty-gritty business of running any of the properties.

For those familiar with the investment world, REITs closely resemble mutual funds, and were established to make investing in real estate more accessible to new investors who may not have the funds to purchase a piece of real estate outright.

There are two options for those looking to invest in a REIT, and they include public and private options. Both have their pros and cons, so it’s important to do your research before deciding which option is right for you.

Real estate crowdfunding (also known as real estate syndication) allows investors to team up together to fund different real estate projects. This gives them the option to spread their money across several investments rather than putting a substantial amount into just one, potentially lowering their risk of taking a massive loss if things don’t pan out.

Note that many real estate syndication options have income requirements for investors.

In some unique situations, an individual may want to invest in a holding mortgage note on another person’s behalf. There are multiple ways to do this, and each option comes with varying degrees of risk.

In some cases, an investor will consider selling a property they already own using a “rent to own” agreement where the tenant’s monthly payments will pay down the balance owed on the property until they completely pay off an agreed upon sales price.

Another way to do this involves lending a buyer the money they need to purchase a property. In this scenario, the investor will hold the mortgage note, and the buyer will send them a monthly payment each month, exactly like they would with a mortgage.

While holding a mortgage note may give you a reliable monthly payment, the investment can take decades to fully pay off depending on the terms of the loan.

Investing in real estate can be a reliable and often lucrative way to build your wealth. You don’t have to be a landlord to do it, either, thanks to the many investment options available on the market.

You aren’t limited to one of the above investments, so bear that in mind as you conduct further research. The real estate market is vast and full of potential, so take your time as you consider the many, many possibilities out there.