How to Build a Real Estate Portfolio Using REITs and Direct Ownership
Building a real estate portfolio can be a lucrative investment strategy for individuals looking to diversify their holdings and increase their passive income streams. One way to do this is by using a combination of real estate investment trusts (REITs) and direct ownership of properties.
REITs are companies that own, operate, or finance income-producing real estate across a range of property sectors. By investing in REITs, individuals can gain exposure to a diversified portfolio of properties without having to directly manage them. This can be a convenient option for those who are looking for a more hands-off approach to real estate investing.
On the other hand, direct ownership of properties allows investors to have more control over their investments and potentially earn higher returns. By purchasing properties outright or through partnerships, individuals can benefit from rental income, property appreciation, and tax advantages.
To build a real estate portfolio using both REITs and direct ownership, investors should first assess their risk tolerance, investment goals, and time horizon. They can then allocate their capital between the two options based on their individual preferences and objectives.
Overall, combining REITs and direct ownership of properties can provide investors with a diversified portfolio that offers both passive income and potential for capital appreciation. By carefully selecting investments and monitoring performance, individuals can build a successful real estate portfolio that meets their financial goals.