Real estate has built more millionaires than almost any other asset class. But for most people, the mental image is the same: you need a big down payment, a mortgage, and a landlord’s patience for 3 a.m. maintenance calls.
None of that is actually required to start investing in real estate today.
Here are five legitimate ways to invest in real estate — some starting at under $10 — even if you’re just getting started.
Why Real Estate Belongs in Your Portfolio
Real estate offers something most assets don’t: multiple income streams at once.
- Rental income — regular cash flow from tenants
- Appreciation — property values tend to rise over time
- Inflation hedge — rents and property values generally rise with inflation
- Tax advantages — depreciation, 1031 exchanges, and pass-through deductions
You don’t need to own a house to capture these benefits. Several modern options let you participate with far less capital.
1. REITs (Real Estate Investment Trusts)
REITs are the easiest entry point. They’re publicly traded companies that own and operate properties — apartment complexes, office buildings, warehouses, hospitals, cell towers, and more.
How to start: Buy shares through any brokerage account, just like a stock. Many popular REITs trade for $20–$100 per share.
Why they work: By law, REITs must pay out at least 90% of taxable income as dividends. That means consistent passive income even if you hold just a few shares.
Popular REIT categories:
| Type | What They Own | Example Tickers |
|---|---|---|
| Equity REITs | Physical properties | VNQ (ETF), O, AMT |
| Mortgage REITs | Real estate loans | AGNC, NLY |
| Diversified ETFs | Mix of REIT types | VNQ, SCHH, XLRE |
If you’re new, a REIT ETF like VNQ (Vanguard Real Estate ETF) gives you instant diversification across hundreds of properties for the price of one share.
Related: What is a brokerage account?
2. Real Estate Crowdfunding
Crowdfunding platforms pool money from many small investors to fund commercial or residential real estate deals. You earn a share of the income and appreciation without managing anything yourself.
How it works:
- Sign up on a crowdfunding platform
- Browse individual deals or diversified funds
- Invest as little as $10–$500 depending on the platform
- Collect distributions (usually quarterly)
Things to know:
- Your money may be locked up for 3–7 years depending on the project
- Returns aren’t guaranteed — deals can underperform or fail
- Some platforms (like Fundrise) are open to anyone; others require being an accredited investor
This is a good option if you want real estate exposure beyond the stock market but aren’t ready to buy property.
3. House Hacking
House hacking means buying a multi-unit property (duplex, triplex, or fourplex), living in one unit, and renting out the others to offset or eliminate your mortgage.
This is one of the most powerful wealth-building strategies available to non-wealthy people because:
- You can use an FHA loan with as little as 3.5% down
- Rental income from neighbors covers part or all of your mortgage
- You’re building equity while learning landlord skills with a safety net
Example: Buy a duplex for $300,000 with a 3.5% down payment (~$10,500). Rent the other unit for $1,200/month. Your net mortgage cost drops dramatically — or disappears entirely.
The catch: you have to be comfortable living next to your tenants and handling repairs or hiring a property manager.
4. Rental Properties the Traditional Way
This is what most people picture — buy a house, rent it out, collect monthly income. It works, but it requires more capital and effort than the other methods.
Rough breakdown of costs:
| Cost | Typical Range |
|---|---|
| Down payment (investment property) | 15–25% of purchase price |
| Closing costs | 2–5% |
| Repairs/renovation buffer | $5,000–$20,000+ |
| 3–6 months cash reserves | Variable |
Before buying a rental, run the numbers carefully. A property that cash flows positively in one market may lose money in another after taxes, insurance, vacancy, and maintenance.
The 1% rule (rough screening tool): Monthly rent should equal at least 1% of the purchase price. A $200,000 home should rent for at least $2,000/month to be worth analyzing further.
This rule is harder to meet in expensive cities, which is why many landlords buy in smaller markets while living elsewhere.
5. Invest Through Your Retirement Accounts
Most people don’t realize you can hold REITs in a Roth IRA or traditional IRA. The tax advantages stack on top of real estate’s existing benefits.
- In a Roth IRA, dividend income from REITs grows and can be withdrawn tax-free in retirement
- In a traditional IRA, you defer taxes on dividends until withdrawal
If you’re already maxing your 529 plan or other accounts, adding a REIT ETF to your retirement portfolio is a simple, low-friction way to get real estate exposure.
Comparing Your Options
| Method | Min. Investment | Effort | Liquidity |
|---|---|---|---|
| REIT (stock) | ~$10–100/share | Very low | High (sell anytime) |
| Crowdfunding | $10–$500 | Low | Low (locked in) |
| House hacking | 3.5% down | Medium-high | Low |
| Rental property | 15–25% down | High | Low |
| REITs in IRA | $1+ | Very low | Medium |
Which Option Is Right for You?
- Just getting started with $500 or less? → REIT ETF in a brokerage or IRA
- Have $1,000–$5,000 and want diversification? → Crowdfunding platform
- Ready to buy your first home? → Consider a duplex and house hack
- Have capital and want active income? → Traditional rental property
There’s no wrong starting point. The real estate investors who build real wealth usually start with one method, learn the mechanics, and expand from there.
You don’t need a fortune to start. You need a brokerage account and $50.
Looking to build your overall investment foundation? Read What is a Brokerage Account and What is a Target-Date Fund for more beginner investing basics.
