How to Invest in Real Estate with as Little as $100
Download MP3Real estate crowdfunding platforms allow you to pool your money with other investors to buy a share of a larger property, such as an apartment building, commercial property, or a single-family home. Many of these platforms have low minimum investment requirements, sometimes as little as $10 to $100.
- How it Works: The platform vets, acquires, and manages the property. You invest a small amount to own a fraction of it and earn a share of the rental income or profits when the property is sold.
- Examples: Platforms like Fundrise and Arrived offer low entry points, making them accessible to a wide range of investors.
- Risks: While a great way to start, these investments are typically less liquid than stocks, meaning it can be harder to sell your shares quickly if you need to access your money.
Real Estate Investment Trusts (REITs) 🏢
A Real Estate Investment Trust (REIT) is a company that owns, operates, or finances income-producing real estate. Think of it like a mutual fund for real estate. By law, REITs must pay out at least 90% of their taxable income to shareholders as dividends.
- How it Works: You can buy shares of a publicly traded REIT through a standard brokerage account, just like you would with any other stock. This allows you to invest in a diversified portfolio of properties (like shopping malls, office buildings, or hotels) without the hassle of being a landlord.
- Examples: You can buy shares of well-known REITs for as little as the cost of one share, which is often less than $100. Many of these REITs are traded on major stock exchanges.
- Benefits: REITs are highly liquid, and many offer a steady stream of income through dividends, making them a popular choice for passive investors.
