The pandemic has highlighted the importance of having a passive source of income. People have realised that having income security is crucial in unpredictable times. Passive income provides a financial safety net and can act as a source of income post-retirement. With the rise of digital connectivity, investing in passive income has become more accessible.
Why Invest In Real Estate?
Real estate investment has emerged as a favourable way to generate passive income. Here are a few ways to do so:
1. Commercial Buildings: Investing in commercial properties can yield a high ROI of 5-6% and offer multiple investment opportunities. Leasing commercial buildings for longer durations reduces the risk of vacancy and generates long-term income.
2. Second Homes: Investing in luxury resort homes can provide high returns of 8-9% and up to 20% with additional benefits. These properties can be occupied for personal use and rented out when not in use, providing regular rental income and zero maintenance worries.
3. Residential Properties: Buying a residential property and renting it out is a common and sought-after option for generating passive income. Real estate rental provides an ROI of 2-3%, and the cost of maintenance and renovation is relatively lower compared to commercial properties.
Real estate investment offers a multitude of opportunities and is considered less risky compared to other investments. It's essential to choose the best option for your needs and make a smart decision to utilise the opportunity. With changing times, the need for generating passive income remains, and real estate emerges as a winner in providing a secure and steady flow of income.
In addition to these options, other ways to generate passive income through real estate include:
- Real Estate Investment Trusts (REITs)
- Real Estate Crowdfunding
- Real Estate Mutual Funds
- Real Estate Exchange-Traded Funds (ETFs)
Each of these options has its benefits and drawbacks, and it's essential to research and understand them before making a decision. With the right investment strategy, real estate can provide a steady stream of passive income and help achieve financial freedom
