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Chase C. Hunter became a real estate investor after a Google search and an initial investment of $3,800. At the time, while living in Houston, he looked for places where he could buy cheap property and found ample opportunities in Detroit, with homes selling for as little as $1,000.
“I closed on my first two properties on the same day in June 2021,” he told Realtor.com in an article published in August 2024 (1). “The day I closed was my first time in Detroit.”
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Both properties had major problems. She paid $2,000 for one and $1,800 for the other, renovated them, found tenants and began her career as a landlord. Since then, he has repeated this process in eight homes.
Hunter’s journey was successful thanks to a lot of effort and a little luck, but it wasn’t easy.
Rental Properties Can Be Labor-Intensive
While Hunter paid very little for the two houses he purchased, that was far from the end of the story.
He had to invest $85,000 in renovations to the house he bought for $2,000 to prepare it for tenants. On the second home, purchased for $1,800, he spent $130,000 converting it into his office due to unexpected water line problems.
But you don’t need to get your hands dirty to make real estate profits.
With Arrived’s Private Credit Fund, you can invest in short-term loans that are used to finance real estate projects, such as renovations, property rehabilitations, or even new home construction projects.
All loans are secured by residential homes as collateral, meaning you don’t have to worry about the security of your investment.
Historically, Arrived Private Credit Fund has paid annualized dividends of 8.1% to investors, distributed monthly. Stock dividend yields aren’t even close: The long-term average dividend yield of S&P 500 companies is 1.83%.
While his business has been a success thus far thanks to his hard work, Detroit’s real estate boom helped fuel this success. The median real estate price plummeted to $58,900 in 2009 and the city declared bankruptcy in 2013.
Now, with prices rising to $250,000, according to Realtor.com, investors like Hunter are finding it much easier to profit in this rapidly appreciating market.
Just a decade after Detroit declared bankruptcy, The Wall Street Journal called it “America’s unlikeliest real estate boomtown.”
But if you don’t have $130,000 to renovate a fixer-upper, there are other ways to invest in real estate. If you prefer passive income to dealing with tenants or large down payments, you could look into crowdfunding platforms.
In addition to its Private Credit Fund, Arrived also allows you to invest in rental home stocks and vacation rentals for as little as $100, without taking on property management responsibilities.
Getting started is simple: browse a select selection of homes (each vetted for their appreciation and income potential) and choose the number of shares you want to purchase.
And once you’ve established a vacation rental investment, you may want to expand into multifamily and industrial properties.
Accredited investors can now take advantage of this opportunity through platforms like Lightstone DIRECT, which provides accredited investors access to single-asset industrial and multifamily deals.
Lightstone DIRECT’s direct-to-investor model ensures a high degree of alignment between individual investors and a vertically integrated institutional owner-operator – a sophisticated and simplified option for individual investors looking to diversify into private market real estate.
With Lightstone DIRECT, accredited individuals can access the same industrial and multifamily assets that Lightstone pursues with its own capital, with minimum investments starting at $100,000.
Read more: Robert Kiyosaki warned of a “greater depression,” in which millions of Americans will become poorer. Was he right?
Real Estate ETFs and REITs
For those who want to invest in real estate without turning it into a full-time job, there are many convenient alternatives.
Investing in real estate investment trusts (REITs) and exchange-traded funds (ETFs) can offer a more accessible and diversified way to participate in the real estate market without the direct ownership and management responsibilities of individual properties.
REITs are publicly traded companies that own properties and distribute profits in the form of dividends. ETFs, on the other hand, pool money to invest in REITs or real estate-related businesses. Both options provide a way to benefit from real estate without the responsibilities of individual ownership.
Want to tap into the experience of former hedge fund analysts to pick the best real estate stocks and ETFs? Try Moby.
Moby’s team of former hedge fund analysts and experts spend hundreds of hours each week sifting through financial news and data to provide top-notch stock and cryptocurrency reports to keep you up to date on what’s moving the markets.
If you’re serious about investing in real estate for passive income, Moby’s superior research can help you reduce the guesswork when selecting REITs or ETFs.
In four years, across nearly 400 stock picks, Moby’s recommendations have outperformed the S&P 500 by nearly 12% on average. With its easy-to-understand formats, you can become a smarter investor in just five minutes, backed by a 30-day money-back guarantee.
No matter what type of investment you are considering, a financial advisor can help you crunch the numbers and come up with a plan that works.
But hiring an advisor can be a lifelong commitment, one that could make or break your retirement. That is why it is essential to find reliable advisors.
That’s where Advisor.com can come into play. The platform connects you with an expert near you for free.
Advisor.com does the heavy lifting for you, vetting advisors based on track record, client ratings, and regulatory history. Additionally, their network is made up of fiduciaries, who are legally obligated to act in your best interest.
Simply enter a few details about your finances and goals, and Advisor.com’s AI-powered matching tool will connect you with the qualified expert who best fits your needs based on your unique financial preferences and goals.
Finding the right advisor isn’t always easy – there’s no one-size-fits-all solution. That’s why Advisor.com allows you to schedule a free, no-obligation initial consultation to see if it’s the right fit for you.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
