Comparison Graphic: Real Estate Investing vs. Mortgage Note Investing: Portfolio Management
Updated: Nov 6, 2020
Common sense investing for building wealth tells us that the preferred alternative investment is clear.
Since 2013, real estate has been the most popular investment in America. Whether flipping, residential rentals, commercial rentals, or vacation rentals, real estate draws in investors like few other investments do. Many look to real estate to fulfill their dreams of passive investment income, when really, they should be looking at mortgage loan investing.
No matter what you’ve read in the countless real estate investing books available, owning real estate and renting it, for any reason, is not a passive investment unless you invest in a REIT, syndication, or fund. The thirteen years I spent as a landlord taught me that owning a rental property is the furthest thing from passive investment you can get.
Ironically, the number one candidate for mortgage loan investment is the burned-out landlord looking for a less stressful and more passive real estate investment option.