Active Income vs Passive Income In Real Estate Explained

Are you thinking about investing in Portland Oregon rental properties? If so, you’re making a smart choice.

Rental properties continue to be a great investment in the 2020s because more people are renting than ever before and investors can earn a stable income while stocks, crypto, and other investments continue to have fluctuations.

Even though rental properties are an excellent investment, the reality is that you have to make sure that you’re earning passive income, instead of active income from your rental properties.

Understanding Active Income vs Passive Income In Real Estate Investing

In the business world, there are many examples of active income but the easiest example of this is any type of business (or job) that requires you to do all of the work yourself to earn that income.

Some examples of passive income in business include:

Digital Passive Income Streams – If you feel comfortable using the internet, you should consider getting started with Active affiliate marketing, CPA marketing or you may want to think about creating your digital products to sell online.

Buy An Existing Business – Another solid way for establishing a passive income stream is to invest in an existing business. Keep in mind that coronavirus has changed the economy in 2021, so investing in a restaurant would not be a good idea for at least the next couple of years but, you may want to consider investing in a service-based business like a general construction company, delivery service, copy service, mobile locksmith, or a car wash.

Invest Passively In Real Estate – Let’s say that you’re thinking about investing in Oregon real estate but, you’re not ready to purchase your first rental property yet. No problem! You should consider investing in real estate passively by investing in a Real Estate Investment Trust, crowdfunding, or by purchasing mortgage notes. Each way is an excellent method for investing in real estate without having to physically hold or manage properties yourself.

Start A Service Based Business – If you’re ready to start a physical business of your own, you may want to consider starting a service-based business like a laundry service because most people hate doing their laundry and if you own a washer and dryer, why not make money from those appliances that you already own?

Make Your Money Work For You – Another easy way to get started with creating passive income streams is to make your money work for you by investing in dividend stocks, high-interest CDs, bond ladders, or high-interest savings accounts.

When it comes to owning rental properties, any property that you’re managing yourself including collecting rent, taking care of maintenance, and serving your tenants is an example of active income.

Your goal as an investor should be to earn passive income from your investments. This means that you’re not doing any of the work to manage your properties yourself because you’ve hired a property manager to professionally manage those properties for you.

With passive income, you can focus on living your normal life while having confidence that your properties are going to be professionally managed for you.

Contact Rent Portland Homes – Professionals

At Rent Portland Homes – Professionals, we specialize in local property management.

Our team will save you the time, money, and hassle of managing your property yourself so that you can enjoy owning rental properties without the hassle.

To learn more about our services, contact us today at (503) 447-7735 or click here to connect with us online.