Thinking About Sinking $100K Into Rental Properties? Consider This Passive Income Option Instead.
Buying a rental property offers the promise of passive income. In theory, the tenants will pay more than enough rent to cover the property's expenses, enabling the landlord to pocket the difference in passive income. In addition to that income, rental property owners can capture tax benefits and property price appreciation.
However, rental properties have their drawbacks. The up-front cost can be well over $100,000 when factoring in the down payment, closing costs, and any repairs needed to make the property ready to rent. Meanwhile, the income isn't always passive since you need to manage the property and the tenants. On top of all that, an unexpected vacancy or repair can turn a rental property from a money maker into a money pit.
There are many alternative ways to generate passive income from real estate. An easy option is to invest in a real estate investment trust real estate investment trust (REIT). These low-cost vehicles enable anyone to collect income backed by real estate. Here are two top REITs to consider.
Source Fool.com
