Overall, it means that you put your money in real estate either in equity (owning the property) or debt (loaning the funds to buy the property). No matter how you invest in real estate, you may earn monthly cash flow, capital gains from appreciation, or interest on your loan.
Passive real estate investing can create the ability for individuals to invest in real estate without the stress or time constraint of operating the real estate property. This short guide will give you all the essential information you’ll need to get started as a passive real estate investor.
Experts say between 25-40% of your net worth should be in real estate because that asset class allows investors to capitalize on the benefits of real estate ownership—like passive income, equity, and appreciation—as you pursue other methods of investment and wealth development
Wealth building is the process of generating long-term income through multiple sources. This refers to more than job-based income and instead includes savings, investments, and any income-generating assets. The wealth building definition relies on proper financial planning and insight into one's future financial goals.
When it comes to building wealth, most people follow the same basic plan — buying stocks or mutual funds, opening a savings or retirement account, and maybe buying some real estate. These are all great ways to save for the future, but none of these strategies are likely to lead to abundance and wealth in the future
In addition to the amount you'd have paid off on your mortgage during that time, this appreciation in value builds even more equity, therefore increasing your net worth.