Introduction
According to Mark Roemer Oakland, there are several ways to create passive income streams via intelligent real estate investments. Passive income streams are great since you don’t have to actively invest your time and effort in order to generate wealth, but it can be difficult to get started if you have no idea how to proceed.
The Sources
Here are a few ways you can build passive income sources via real estate:
- Purchase and rent properties – The most common and simplest way to generate a reliable passive income source through real estate is to purchase new properties and rent the units. Investing in single-family home (SHF) properties are ideal for newbies since they are long-term assets that allow you to increase your cash flow.
However, you have to keep in mind that these investments are also risky since the monthly revenue is dependent on the vacancy and may not be stable. Plus, these would require additional investment in the form of maintenance.
If you want to generate wealth on a much larger scale, you can invest in multi-family units such as duplexes, triplexes, quadplexes, and even apartment buildings to increase your cash flow and income. However, although you can enjoy better cash flow when everything goes well, you have to be prepared to manage and maintain multiple units and bear the risk of the vacancy of multiple units as well.
- Consider investing in storage units or facilities – Storage unit facilities are in high demand in both rural and urban areas. You can purchase multiple storage units and generate good cash flow with relatively low overhead. However, you have to consider other factors such as the cost of security, property maintenance, and insurance.
- Invest in vacation properties – Investing in vacation properties can be one of the most lucrative ways to generate passive income, especially if the property is located in a popular tourist attraction. The best part is that you can use the property on certain weeks of the year when you are on a trip with your family or friends.
Vacation rental properties allow you to charge more on a per-night basis compared to renting properties for the long term. But you have to deal with cancellations, constant scheduling, housekeeping costs, and more.
- Invest in commercial properties – Usually, it takes more capital to invest in commercial properties compared to investing in residential properties. However, you can lease them to businesses to generate a stable, long-term passive income stream. Similarly, you also have to be prepared for higher remodeling costs and lengthy vacancies. Thus, it is often recommended that you invest in such properties with a business partner.
Conclusion
Mark Roemer Oakland suggests you consider investing in real estate investment trusts (REITs) if you want to adopt a truly passive role in real estate investing. When you invest in REITs, you invest in shares of properties and can receive dividends from them or benefits when the value of the asset grows in the future.
