Real Estate Passive Income Streams You Can Start Now

So you’ve bought a house or your first rental property or commercial property. How can you increase your financial freedom through real estate? You can start by creating passive income streams with the property.

Passive income is what every real estate professional is after and real estate should be what every investor is after (at some point in their money-making journey).

Real estate passive income streams are ways to make money in or related to real estate that don’t require a lot of time or ongoing management.

In this article, we’ll go over several different ways to create and grow real estate passive income streams.

By following these strategies, you can build a foundation for success that will not only help you achieve financial independence but also allow more time for personal pursuits so that you can have both time and money freedom and live the lifestyle that you really want to live.

Real Estate Passive Income Streams

1. Rental Properties
2. Rent out a Room
3. Commercial Leasing
4. REITs
5. Money Lending
6. Property Management
7. Crowdfunding
8. Parking Spaces
9. Referrals
10. Informational Products
11. Seller Financing
12. Airbnb
13. eXp Revenue Share

1. Rental Properties

Rental properties are one of the most common and important types of passive income streams for real estate professionals.

There are a few reasons why rental properties are so crucial for generating passive income.

First, rental properties offer a steady monthly income. This is important because it provides a consistent cash flow that you can count on month after month.

Second, rental properties are a great way to build equity. Equity is the difference between the value of a property and the amount of money that you owe on it. As your property equity grows, so does your net worth.

Third, rental properties offer tax benefits. The government offers a number of tax breaks for those who invest in rental property. These tax breaks can help to reduce your tax liability.

If you want to reduce your tax liability while getting a revolving line of credit:

2. Have Roommates Pay Off Your Mortgage

Renting out a room in your home is one of the simplest methods to establish a passive income source. If you have a 4 bedroom, that’s one room for you and $500/month OR MORE per bedroom.

This is such a fantastic approach to make passive money for a few different reasons.

You may earn extra cash without putting forth a lot of effort by renting out a room in your house. You might be able to lower your monthly expenses as a result, or you might be able to save money for a down payment on a new home.

Another way to increase your equity is to rent out a room in your house. Your equity in the home will rise as a result of your renter’s payments decreasing the balance owed on the mortgage.

When you own duplexes, triplexes, or fourplexes, you can use this tactic, which is also known as “house hacking,” on a larger scale.

3. Commercial Leasing

Among the many ways that real estate agents and brokers make money, commercial leasing is a significant source of residual income.

Profiting from the rental of your property to businesses is possible through commercial leasing.

Commercial leasing is a means for real estate agents to make money by renting out space to businesses.

You can accomplish this by reaching out to local businesses you think might be a good fit for your property or by searching online for local businesses who are on the market for new locations.

Once you’ve selected a tenant firm, it’s time to draft a lease agreement that works for everyone involved. The amount of rent to be paid each month, the lease’s duration, and any other relevant information should all be included in this document.

You should also make sure you are okay making a long-term commitment before signing a business lease, as these contracts tend to be lengthier than residential leases.

4. Real Estate Investment Trusts (REIT)

Real estate investment trusts (REITs) are one of the most important types of passive income for real estate professionals.

REITs are a way for you to invest in real estate without having to purchase a property yourself.

This is important because it allows you to invest in a wide variety of properties without having to worry about the day-to-day management of those properties.

REITs also offer a number of tax benefits that can help reduce your tax liability, much like owning rental properties.

If you already own REITs and want more:

Consider taking out collateral loan or utilizing REIT-specialized lending networks like A.B. Nicholas.

5. Mortgage/Private/Hard Money Lending

Profiting from mortgage lending entails lending money to other investors so that they may acquire rental property.

Lending money to investors so they may buy rental properties is a passive way for real estate experts to generate money. You may either partner with an existing mortgage lender or start your own hard money lending business to accomplish this.

Another way to make passive income is to lend money to real estate investors who flip houses. The term “house flipper” refers to someone who buy homes with the intention of quickly selling them after making improvements. When you lend money to real estate investors, you can make money from the time they keep the property while it’s being fixed up or sold.

6. Property Management

Real estate professionals can make passive income by managing other people’s properties.

They do this by charging the owner of the property a monthly fee to manage the investment property, usually 10% of the gross monthly income for each property.

A property manager is responsible for the day-to-day operations of a property. This includes collecting rent, maintaining the property, and addressing any issues that may arise.

Be aware that in some states, you do need to be licensed as either a real estate agent or broker to be able to manage other people’s properties for income.

7. Crowdfunding

Crowdfunding is a way to get money from a lot of people to help finance a project. People who give money are called “crowdfunders.”

Some people use crowdfunding to help finance their real estate projects. This can be done by creating a campaign on a crowdfunding website or by reaching out to family and friends.

Crowdfunding can be a great way for investors to get their projects off the ground.

You can invest in real estate projects through crowdfunding to make passive income without having to manage the property. This is a great way for investors who have more money than they do time to create a passive income stream.

8. Receiving rent for parking spaces

Some people invest in parking spaces. They can be rented out for a monthly fee. The owner does not have to do anything else. They just get the rent money every month.

This is a lesser-known passive income source, but it is something that can be done fairly easily.

There are a few ways to buy parking spaces and rent them out for money each month. One way is to buy a parking space in a city where there is a lot of traffic. This will ensure that there is high demand for the space.

Another way to buy a parking space is to find a space that is close to public transportation or major attractions. This will make it easier for people to get to, which will increase the demand for the space.

Finally, if you want to buy a parking space, be sure to do your research first. Make sure that you are getting a good deal on the space and that it is in a good location just like you would for rental or commercial property investment.

9. Get paid to refer people to buy or sell a home

If you have a real estate license, you can get paid when you refer someone to buy or sell a home with another realtor. This is called a referral.

When someone buys or sells a home, they usually go to a real estate agent. That agent will then give the person who referred them to the buyer or seller money as a thank-you for sending them business.

Real estate referrals are usually 25% of the total commission size.

A referral fee can be a great way to make passive income from real estate. You do not have to actively work for the money. Instead, all you have to do is refer someone else and then wait until they buy or sell a house.

10. Create and sell an informational product

Some successful real estate professionals use their knowledge and expertise to make money by selling online courses.

They can do this by creating a course that teaches people about real estate, marketing, investing, wealth-building, or sales.

This can help other people who want to become real estate entrepreneurs. It can also help current real estate professionals learn new skills and strategies for making more money.

Being an online course creator is a way that many real estate professionals make passive income. All they have to do is create the course once, and then it will continue to make them money in perpetuity without needing any additional work on their part.

Creating and selling a book and collecting passive royalty income is also a great alternative to making online courses.

11. Seller Financing

Seller financing is when you “become the bank”

Real estate professionals can use seller financing to create passive income. Seller financing is when you sell a home but the buyer pays you every month, not the bank. This can be a great way to get your property off the market quickly.

You can also use seller financing to get a higher price for your home. The buyer will be more likely to pay more money if they know that they do not have to go through a bank.

Seller financing is a great way to make money without having to do any additional work. You just have to find a buyer who will agree to your terms.

Usually seller financing is best for buyers who can not get bank financing or a mortgage but is able to make monthly payments to pay off the home.

When you seller finance a home you sell, you are essentially earning passive income every month equivalent or similar to the amount of a rental income but since you don’t own the home, you are not responsible for any damages and do not have to manage the property.

12. Airbnb Rental Properties

Airbnb rental properties are another great way to generate passive income.

There are a few reasons why Airbnb rental properties are such a great way to make money.

Short-term rentals are a great way to make money. Since turnovers are higher, you can charge more per stay.

Owning short-term rentals is much like being in the hospitality or hotel industry. You can run your business from home and you do not have to worry about many of the issues that come with long-term property management.

A downside of owning short-term rentals is that you do need to put more work in each month to manage your properties because turn-over rates are higher and you also are putting yourself at more risk because it is more of a commodity and luxury service than long term residential real estate.

Short-term rentals are also a great way to diversify your real estate portfolio.

13. exp Revenue Share

Lastly, if you want to make passive income without having to invest a lot of money or take on financial and legal risk, you might want to consider the revenue share model at eXp Realty.

As a real estate agent, you can choose to join the brokerage eXp Realty and participate in the revenue share model.

The revenue share model is where the company will pay you to refer other quality producing real estate agents to join the brokerage through sharing back the revenue generated to the company through the agents’ production each month.

It is a great way for real estate professionals who are well connected to generate a passive income stream. It is also a great income stream because it has a duplication component that almost no other passive income stream has that allows your revenue share income to grow exponentially over time.

Passive Income Streams in Real Estate: Change Your Lifestyle Today!

Real estate has a variety of passive income streams available to real estate professionals.

However, all of these methods have one commonality- they require some effort on the part of the real estate professional to get started.

Once you have taken the initial steps to create a passive income stream that is self-sustaining, it will continue to make money for you without requiring any additional work.

This will allow you to free up more of your time that you can then use to spend with your friends and family, take vacations/travel, or you can re-invest that time to create more streams of passive income and increase your income to build an even better lifestyle.

So, what are you waiting for? Get started today!