Can you invest in real estate without actually buying a property?

Investing in real estate can be profitable provided you find a good property in a great location. But one thing that stops many investors from choosing real estate investment is the large capital required. Can you reduce the capital required and invest in real estate without actually buying a property? Yes! And when there is no ownership of the property, you also get tax reduction and other benefits.

Real estate mutual funds

Mutual funds are managed funds which are easy options for the new investors. If you choose real estate mutual funds you would be able to reap the profits of real estate investment without buying a property. Diversification provided by the mutual funds would also be good for your investment portfolio. Here your funds would be invested by the mutual fund’s company on real estate stocks, on your behalf.

Real estate investment trust

Publicly traded stocks are known to have their advantages for the investors. REITs combine these benefits with the benefits offered by real estate investment. One major trait of REITs is the liquidity that they offer. Real estate investments in the form of properties might be difficult to buy or sell instantly. But with REITs, this is tackled and you would thus be able to balance your portfolio and allocate your assets accordingly. Added to all this you also get a transparency that makes these investments easy to understand.

Real estate exchange traded funds

Very similar to mutual funds in a lot of ways ETFs also have many additional perks. Real estate is known to pose as a strong hedge against inflation. The stability offered by real estate combined with the security and convenience offered by ETFs would be available with real estate ETFs. The yield from each real estate ETF varies and not all of them are equally profitable. So if care is taken to pick the right one real estate ETFs can be some of the most secure and lucrative investments.

Real estate notes are known to have strong investment potential

When you invest in real estate notes, you are assured of passive income where your efforts might not be required. Management of the owned volume is simpler with notes. The rate of returns are also known to be higher with real estate notes and you also receive the monthly interests.

Benefits of investing in real estate without buying a property

  • Ownership gives you ultimate control over the property and the flexibility to customize your property. In that case, why should you invest in real estate without buying a property?
  • Liquidity and the freedom to take a buy or sell decision when required is one main benefit.
  • Management of a real estate, taking care of the maintenance in order to preserve the property value, all requires a lot of efforts. This can be cut down when you invest in real estate based investments without buying a property.
  • There is assistance provided in managing your funds. So even if you are very new to investing you would be able to handle your finances without any trouble.