When it is time to invest certain investors are more comfortable with tangible estate rather than numbers on screens. So, if you’re interested in diversifying your portfolio by investing in real estate, it may be worthwhile to research this option.

Real estate investment comes with distinct advantages like cash flow and potential appreciation. However, it’s important to note that cash flow can fluctuate dramatically and the value of a property can rise or decrease due to a number of factors.

The buy and hold strategy is a well-known option for novices. It involves buying an investment property to earn rental income and potential capital appreciation. This method is labor-intensive and requires you to meticulously research and vet potential investment opportunities. It’s also relatively illiquid, meaning that once the deal is closed and your money is refunded you’ll need to find a new opportunity to invest in.

A REIT (real estate investment trust) is a different method to invest in real estate. These companies solicit funds from shareholders to buy and manage properties such as apartment complexes, office buildings and strip malls, which can be used for rentals and long-term appreciation. REITs, unlike individual real estate investments, are traded publicly. They can diversify your portfolio from stocks and bonds.

One last way to start your journey into real estate investing is by becoming a landlord yourself. This can be done by purchasing traditional rental properties or by making use of modern business apps and brokerages that permit you to purchase a portion of a property. This is usually less expensive than becoming a home owner and it allows you to be able to balance the desire for physical assets in your portfolio with the degree of separation you’d like from your investment choices.

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