Investing in real estate is known as one of the best ways to diversify your investment portfolio and build wealth. But when thinking about making money with real estate, the first thing a lot of people imagine is someone visiting the bank frequently, going from one investment property to another, running after tenants to collect their rents, etc. And while owning rentals is one way of investing in real estate, the coronavirus pandemic is making it a difficult investment strategy to pursue. COVID-19 is forcing the concept of social distancing, meaning not a lot of people are planning to go out and buy rental properties. However, there are plenty of ways to make money from home during the coronavirus. The real estate industry offers a number of great opportunities to make money without leaving the safety of your house. In this article, we’ll show you the five best ways of how to make money from home in 2020.
#1. Renting Out a Unit (House Hacking)
If you want to be working from home as a landlord but don’t want to go out to take out a mortgage for buying a rental property, you can make extra money from home by renting out a unit/part of your primary residence. This is called “house hacking” and it’s considered one of the best ways to kick-start your real estate investing business. This strategy would work if you live in a duplex, triplex, or any other multi family home in order to live in one unit and rent out the others. If local laws permit it, you can also rent out parts of your single family home.
The main idea behind house hacking is that you collect rent from other people to pay for your expenses. If done right, you get to live in your home for free. House hacking also gives beginners in the business a hands-on experience on what it’s like to be a landlord without actually buying rental property. This is a fast way of making money from home with no money and no experience in the real estate industry. To learn more about this way of how to make money from home with real estate in 2020, check out The Ultimate Guide to House Hacking.
#2. Renting Out on Airbnb (Quarbnb)
Until the COVID-19 pandemic, vacation rentals were a popular and lucrative business. And while Airbnb hosts are feeling the effect of the coronavirus, Airbnb has created a new opportunity for all homeowners and real estate investors to capitalize on short-term rentals. The company introduced a new program that is called “Airbnb Open Homes” which offers housing for first responders looking for a place to stay during times of emergency. First responders can connect with Airbnb hosts who are making their rentals available via a new portal the company has set up.
If you’re wondering how to make money during the coronavirus, this is something to consider in 2020. Today, many who are dealing with the coronavirus outbreak are looking for Airbnb rentals to stay in either to be closer to their worksite or to self-quarantine away from their families while they’re treating or interacting with COVID-19 patients. It recently became known as “Quarbnb”. Airbnb has created a list of cleaning and safety protocols for hosts participating in the new program. According to the company, only full listings — not shared ones — are eligible. Hosts don’t have to offer their rental properties for free, but will still have all fees waived by Airbnb.
#3. Real Estate Investment Trusts (REITs)
If you’ve been researching how to make passive income while investing in real estate, then you must have read about Real Estate Investment Trusts (REITs). This can be a great option if you want to make money from home without having to do any physical work. A REIT is a publicly or privately held company that finances, owns, and manages income-generating properties. These are typically commercial real estate properties such as shopping malls, senior housing, multi-family homes, and several others.
Remember, you don’t own the property when investing in a REIT, but shares within the REIT. In other words, investing in REITs is very much like investing in mutual funds or trading with stocks as you only need to purchase equity or shares in the real estate company. REITs allow even beginner real estate investors to access their assets and receive potential dividends from their generated income. Investors don’t have to be actively involved in the day-to-day activities. You can simply follow developments in the real estate market on your computer to buy and sell shares in a REIT and, hence, make money from home with real estate.
Related: What Is REIT and Is It a Good Real Estate Investment Strategy?
#4. Real Estate Crowdfunding
In the past, making money with real estate was an option mainly for wealthy individuals with hundreds of millions of dollars or access to financial manpower. However, the advent of the internet and the introduction of the JOB Act of 2012 made it possible for small investors to pool their resources together for real estate investment purposes. This produced Online Crowdfunding. Making money from home through crowdfunding is quickly becoming a highly-patronized real estate investment strategy. Real estate crowdfunding allows you to pool your funds with others to invest in commercial real estate. This is usually done through online crowdfunding sites that connect real estate developers to investors.
One of the benefits of real estate crowdfunding is that it’s a passive investment strategy with little to no managerial responsibilities on your side. Meaning, you don’t have to deal with common landlord issues like finding a rental property for sale, screening tenants, maintaining the property, etc. Instead, it’s the sponsor who handles all of that work in addition to the distribution of potential profits to the investment participants. So, if you’re interested in how to make money online from home with real estate and want an additional stream of income in 2020, online crowdfunding may be an easy option for you.
#5. Real Estate Syndication
The final strategy for how to make money from home in 2020 during the coronavirus pandemic is to try out real estate syndication. Real estate investors are always looking to expand their investment portfolios. But some investment opportunities might be beyond your financial capability. Real estate syndication is a great way to acquire this type of property/properties from the safety of your home. Basically, a real estate syndication is a partnership between multiple investors. They pool their resources, experience, and capital together to acquire and manage a property that they otherwise couldn’t afford individually.
Under a typical property syndication structure, there are two main categories of real estate investors — the sponsors (or general partners) and the investors (or limited partners). The sponsor is solely responsible for the acquisition, reporting, and management of the investment property. So, you can join a real estate syndication as a limited partner and your role in the partnership will only be to supply the funds. This allows you to start making money from home through monthly rental income without being actively involved in the day-to-day running of the property.
Related: What Is Real Estate Syndication and How Does It Make You Money?
The Bottom Line
So now you know how to make money from home with real estate during the coronavirus pandemic and financial crisis. The next step is for you to do more research to further enhance your real estate knowledge of the principles of real estate investing and the recent housing market trends and predictions. This will allow you to pick the best way to make quick money from home while social distancing. It’ll pay off by allowing you to be a better real estate investor who makes smarter decisions in 2020 and beyond. You can start your real estate education by reading about everything real estate on our investment blog.
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