Real estate investing has been a well-known strategy to build wealth over the last several years. It provides many benefits in terms of diversification, tax benefits and equity building, as well as competitive returns that are risk-adjusted. There are a few drawbacks, such as insufficient liquidity, and high capital requirements. If you’re thinking about adding real estate to your portfolio, it is important to think about your investment goals, your level of expertise and your level of risk tolerance.

Real estate investing is hands-on or hands-off based on your choice of property and management style. For instance rental properties tend to be one of the most hands-on property investments due to the ongoing maintenance and vacancy expenses. But they can also provide an income stream that is steady and have the potential to appreciate over time.

Another option is to purchase commercial properties such as shopping malls, hotels, or office buildings. This type of investment could provide steady cash flow, rent growth and a hedge against inflation. However, it can be more difficult to manage than residential real estate and typically has higher upfront costs.

Another option is to acquire raw land and lease it to the development of homes or businesses. This can provide an income stream that is steady. This is an approach that is hands-off, but it can have some risks as well, including the need for development fees and the potential for environmental issues that read here can affect the value of the property.

You can also invest in REITs, which is a type of mutual fund that focuses on a specific property portfolio. REITs are generally less hands-on and require lower upfront investments than investing in physical properties however they don’t provide the same flexibility or liquidity as direct real estate investments.