--- title: "Passive Income Portfolio Management: 4 Things to Know" description: Passive investments in commercial real estate give investors many potential options for diversification. image: https://www.realized1031.com/hubfs/Images/photo/abstract/sack-laptop-portfolio-IS-1250426655.jpg --- [![Realized 1031 Exchange Marketplace](https://www.realized1031.com/hs-fs/hubfs/Images/Brand/Logo/Realized/Realized-Logo-Black.png?width=240&height=80&name=Realized-Logo-Black.png "Realized 1031 Logo") ](https://www.realized1031.com/) - [Wealth Management Gap](https://www.realized1031.com/the-wealth-management-gap) - [Our Process](https://www.realized1031.com/how-realized-works) - [Financial Advisors](https://www.realized1031.com/advisor) - [Resources](https://www.realized1031.com/resources) - [The Company](https://www.realized1031.com/about-us) - [Articles](https://www.realized1031.com/blog) [Register](https://www.realized1031.com/marketplace) [Log In](https://www.realized1031.com/login) - Better Business Bureau Rating: **A+** - [FINRA BrokerCheck](https://brokercheck.finra.org/firm/summary/22333) - [Call](tel:1-877-797-1031) **(877) 797-1031** # Passive Income Portfolio Management: 4 Things to Know Posted May 6, 2021 ![sack-laptop-portfolio-IS-1250426655](https://www.realized1031.com/hs-fs/hubfs/Images/photo/abstract/sack-laptop-portfolio-IS-1250426655.jpg?width=749&name=sack-laptop-portfolio-IS-1250426655.jpg) For long-term investments, Americans tend to prefer real estate. According to a [Gallup survey](https://news.gallup.com/poll/208820/americans-favor-real-estate-long-term-investment.aspx), 34% of Americans said that real estate was the best long-term investment — beating stocks, bonds, mutual funds, gold, savings accounts, and CDs.  Real estate also doesn’t have to be as hands-on as some believe. There are several strategies that allow investors to invest in income property without putting in a significant amount of time or effort. Who wouldn’t want to make [passive income](https://www.realized1031.com/blog/what-is-passive-income-and-how-do-you-generate-it) from their income property? Here are a few potential benefits of passive real estate investing.  ### Have Your Passive Income Managed by a Professional [Direct real estate investing](https://www.realized1031.com/blog/what-are-the-differences-between-direct-and-indirect-property-investments) puts the investor in the driver’s seat. The investor has direct ownership over the property. You pick the location, asset type, investment strategy, financing structure, and exit strategy. However, there are things you must deal with that wouldn’t occur with passive investments; namely the three Ts: tenants, trash, and toilets.   If time is an issue or you don’t want to deal with the day-to-day operations that come with direct ownership of a property, then passive real estate investing is an ideal option. Plus, you have the experience of a seasoned professional to guide you. Passive real estate investing lets the investor dip their toes into real estate without necessarily having to manage the property themselves.  ### Diversification with Investment Types Passive investments in commercial real estate give investors many potential options for [diversification](https://www.realized1031.com/blog/how-to-measure-diversification-in-a-portfolio).  **Different asset classes. **Investors can spread risk across a wide range of properties such as retail, office buildings, hotels, multi-family rental properties, and more. Each class has a different risk profile and some may be better suited for a particular demographic or economic cycle.  **Multiple tenants. **You’ll likely have multiple tenants paying you rent, which means there’s less risk if one tenant defaults on their lease payment or decides to move out.  **Investment strategies. **There are several investment strategies for passive real estate investing. Investors can purchase shares through [real estate investment trusts (REITs)](https://www.realized1031.com/glossary/real-estate-investment-trust-reit), crowdfunding, hard money lending, real estate ETFs, [Delaware Statutory Trusts (DSTs)](https://www.realized1031.com/glossary/delaware-statutory-trust-dst), or real estate mutual funds. **Different markets. **Investors aren’t limited by their location when it comes to passive commercial real estate investing. You don’t have to put all of your eggs into one basket. **Invest in multiple properties. **You can invest in multiple properties to diversify and mitigate risk. ### Liquidity [Liquidity](https://www.realized1031.com/blog/is-real-estate-a-liquid-investment) refers to the ease with which an asset can be converted into cash without affecting its market price. Direct ownership in real estate is among the least liquid investments you can make. However, there are ways to increase liquidity on income property.  Instead of direct ownership, investors can have easy access to their capital through publicly traded real estate investing. The most popular options are REITs, real estate mutual funds, and real estate ETFs.  ### Passive Income from Your Income Property The potential to increase your cash flow through real estate investing without much effort on your part is one of the top benefits of passive real estate investing. Passive income is money from an investment that doesn’t require you to actively work in order to receive.  Not everyone has the experience or time necessary to directly own and operate income property. Passive real estate investing is a great way to get started without actively managing property.  This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. Learn Ways To Help Build Long-Term Real Estate Wealth [![Get Tips For Managing Real Estate Wealth](https://www.realized1031.com/hs-fs/hubfs/Images/UI/graphics/composites/IPWM-eBook-250c.jpg?width=250&height=250&name=IPWM-eBook-250c.jpg "Learn new ways to use real ...") ](https://www.realized1031.com/blog/passive-income-portfolio-management-4-things-to-know#blogform) Download eBook ---   --- ### Get Tips For Managing Real Estate Wealth ![Learn Ways To Help Build Long-Term Real Estate Wealth](https://www.realized1031.com/hs-fs/hubfs/Images/UI/graphics/composites/IPWM-eBook-550.jpg?width=550&height=650&name=IPWM-eBook-550.jpg) Learn new ways to use real estate to pursue your wealth goals. By providing your email and phone number, you are opting to receive communications from Realized. If you receive a text message and choose to stop receiving further messages, reply STOP to immediately unsubscribe. Msg & Data rates may apply. To manage receiving emails from Realized visit the Manage Preferences link in any email received. Search ### [Why Realized](https://www.realized1031.com/why-realized) - [Wealth Management](https://www.realized1031.com/the-wealth-management-gap) - [Why Realized](https://www.realized1031.com/why-realized) - [Our Process](https://www.realized1031.com/how-realized-works) - [Scenarios](https://www.realized1031.com/scenarios) - [Private Client Program](https://www.realized1031.com/private-client) - [Realized Exchange Services](https://www.realized1031.com/realized-exchange-services) ### [The Company](https://www.realized1031.com/about-us) - [The Team](https://www.realized1031.com/about-us) - [FAQ](https://www.realized1031.com/frequently-asked-questions) - [Testimonials](https://www.realized1031.com/testimonials) - [Press](https://www.realized1031.com/press) - [Careers](https://www.realized1031.com/careers) ### [Partners](https://www.realized1031.com/partners) - [Financial Advisors](https://www.realized1031.com/advisor) - [Broker Dealers](https://www.realized1031.com/partners/broker-dealers) - [Real Estate Agents](https://www.realized1031.com/partners/real-estate-agents) - [Certified Public Accountants](https://www.realized1031.com/partners/certified-public-accountants) ### [Resources](https://www.realized1031.com/resources) - #### Learn - [Articles](https://www.realized1031.com/blog) - [Glossary of Terms](https://www.realized1031.com/glossary) - [Capital Gains Tax Rates](https://www.realized1031.com/capital-gains-tax-rate) - #### Watch - [Video Library](https://www.realized1031.com/videos) - [Webinar Archive](https://www.realized1031.com/webinars) - #### Read - [Delaware Statutory Trust](https://www.realized1031.com/delaware-statutory-trust) - [Tenants-In-Common](https://www.realized1031.com/tenants-in-common-tic) - [1031 Exchange](https://www.realized1031.com/1031-exchange) - [Qualified Intermediary](https://www.realized1031.com/qualified-intermediary) - [Qualified Opportunity Zones](https://www.realized1031.com/opportunity-zones) #### Realized - 500 W 13th Street Austin, TX 78701 - (877) 797-1031 ##### [Contact Us](https://www.realized1031.com/contact-us) - [![Realized on Facebook](https://www.realized1031.com/hs-fs/hubfs/Images/UI/Social/Icons/Mix/social-facebook-whiterev.png?width=60&height=60&name=social-facebook-whiterev.png)](https://www.facebook.com/Realized/) - [![Realized on LinkedIn](https://www.realized1031.com/hs-fs/hubfs/Images/UI/Social/Icons/Mix/social-linkedin-whiterev.png?width=60&height=60&name=social-linkedin-whiterev.png)](https://www.linkedin.com/company/realized/) - [![Realized on YouTube](https://www.realized1031.com/hs-fs/hubfs/Images/UI/Social/Icons/Mix/social-youtube-whiterev.png?width=60&height=60&name=social-youtube-whiterev.png)](https://www.youtube.com/c/Realized1031?sub_confirmation=1) - [![Realized Holdings, Inc. BBB Business Review](https://www.realized1031.com/hs-fs/hubfs/Images/professional-assoc/bbb/RZH2-bbb-seal.png?width=40&height=65&name=RZH2-bbb-seal.png)](http://www.bbb.org/central-texas/business-reviews/real-estate-investors/realized-holdings-llc-in-austin-tx-1000112948/#bbbonlineclick) - [![FEA Logo](https://www.realized1031.com/hs-fs/hubfs/Images/professional-assoc/fea/RZH2-fea-logo.png?width=82&height=65&name=RZH2-fea-logo.png "FEA Logo")](https://www.1031.org) SECURITIES DISCLOSURE Realized1031.com is a website operated by Realized Technologies, LLC, a wholly owned subsidiary of Realized Holdings, Inc. (“Realized Holdings”). Securities and/or Investment Advisory Services may be offered through Registered Representatives or Investment Advisor Representatives of Realized Financial, Inc. ("Realized"), a broker/dealer, member [FINRA](https://www.finra.org)/[SIPC](https://www.sipc.org/), and registered investment adviser. Realized is a subsidiary of Realized Holdings, Inc. ("Realized Holdings"). Check the background of this firm on [FINRA's BrokerCheck](https://brokercheck.finra.org/firm/summary/22333). Hypothetical example(s) are for illustrative purposes only and are not intended to represent the past or future performance of any specific investment. Investing in alternative assets involves higher risks than traditional investments and is suitable only for sophisticated investors. Alternative investments are often sold by prospectus that discloses all risks, fees, and expenses. They are not tax efficient and an investor should consult with his/her tax advisor prior to investing. Alternative investments have higher fees than traditional investments and they may also be highly leveraged and engage in speculative investment techniques, which can magnify the potential for investment loss or gain and should not be deemed a complete investment program. The value of the investment may fall as well as rise and investors may get back less than they invested. This site is published for residents of the United States who are accredited investors only. Registered Representatives and Investment Advisor Representatives may only conduct business with residents of the states and jurisdictions in which they are properly registered. Therefore, a response to a request for information may be delayed until appropriate registration is obtained or exemption from registration is determined. Not all of services referenced on this site are available in every state and through every representative listed. For additional information, please contact the Realized Compliance department at 512-472-7171 or info@realized1031.com. - [Terms & Conditions](https://www.realized1031.com/terms-and-conditions) - [Privacy Policy](https://www.realized1031.com/privacy-policy) - [Form CRS](https://www.realized1031.com/hubfs/common-files/disclosures/FormCRS.pdf) - [ADV 2A](https://www.realized1031.com/hubfs/common-files/disclosures/ADV2A.pdf) - [Reg BI Disclosures](https://www.realized1031.com/hubfs/common-files/disclosures/RegBI.pdf) -   © 2026 Realized Holdings, Inc. ```json { "@context" : "http://schema.org/", "@type" : "BlogPosting", "articleBody" : "For long-term investments, Americans tend to prefer real estate. According to a Gallup survey, 34% of Americans said that real estate was the best long-term investment — beating stocks, bonds, mutual funds, gold, savings accounts, and CDs. Real estate also doesn’t have to be as hands-on as some believe. There are several strategies that allow investors to invest in income property without putting in a significant amount of time or effort. Who wouldn’t want to make passive income from their income property? Here are a few potential benefits of passive real estate investing. Have Your Passive Income Managed by a Professional Direct real estate investing puts the investor in the driver’s seat. The investor has direct ownership over the property. You pick the location, asset type, investment strategy, financing structure, and exit strategy. However, there are things you must deal with that wouldn’t occur with passive investments; namely the three Ts: tenants, trash, and toilets. If time is an issue or you don’t want to deal with the day-to-day operations that come with direct ownership of a property, then passive real estate investing is an ideal option. Plus, you have the experience of a seasoned professional to guide you. Passive real estate investing lets the investor dip their toes into real estate without necessarily having to manage the property themselves. Diversification with Investment Types Passive investments in commercial real estate give investors many potential options for diversification. Different asset classes. Investors can spread risk across a wide range of properties such as retail, office buildings, hotels, multi-family rental properties, and more. Each class has a different risk profile and some may be better suited for a particular demographic or economic cycle. Multiple tenants. You’ll likely have multiple tenants paying you rent, which means there’s less risk if one tenant defaults on their lease payment or decides to move out. Investment strategies. There are several investment strategies for passive real estate investing. Investors can purchase shares through real estate investment trusts (REITs), crowdfunding, hard money lending, real estate ETFs, Delaware Statutory Trusts (DSTs), or real estate mutual funds. Different markets. Investors aren’t limited by their location when it comes to passive commercial real estate investing. You don’t have to put all of your eggs into one basket. Invest in multiple properties. You can invest in multiple properties to diversify and mitigate risk. Liquidity Liquidity refers to the ease with which an asset can be converted into cash without affecting its market price. Direct ownership in real estate is among the least liquid investments you can make. However, there are ways to increase liquidity on income property. Instead of direct ownership, investors can have easy access to their capital through publicly traded real estate investing. The most popular options are REITs, real estate mutual funds, and real estate ETFs. Passive Income from Your Income Property The potential to increase your cash flow through real estate investing without much effort on your part is one of the top benefits of passive real estate investing. Passive income is money from an investment that doesn’t require you to actively work in order to receive. Not everyone has the experience or time necessary to directly own and operate income property. Passive real estate investing is a great way to get started without actively managing property. This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions.", "articleSection" : [ "Real Estate Investing" ], "author" : { "@type" : "Person", "email" : "marketing@realized1031.com", "image" : "", "name" : "The Realized Team", "url" : "https://www.realized1031.com/blog/author/the-realized-team" }, "dateModified" : "2021-05-06T12:00:01+0000", "datePublished" : "2021-05-06T12:00:00+0000", "description" : "Passive investments in commercial real estate give investors many potential options for diversification. ", "headline" : "Passive Income Portfolio Management: 4 Things to Know", "image" : { "@type" : "ImageObject", "height" : 500, "url" : "https://f.hubspotusercontent10.net/hubfs/733513/Images/photo/abstract/sack-laptop-portfolio-IS-1250426655.jpg", "width" : 749 }, "mainEntityOfPage" : "https://www.realized1031.com/blog/passive-income-portfolio-management-4-things-to-know", "name" : "Passive Income Portfolio Management: 4 Things to Know", "publisher" : { "@type" : "Organization", "address" : { "@type" : "PostalAddress", "addressCountry" : "USA", "addressLocality" : "Austin", "addressRegion" : "TX", "postalCode" : "78701", "streetAddress" : "500 W 13th Street " }, "logo" : { "@type" : "ImageObject", "height" : 60, "url" : "http://www.realized1031.com/hubfs/Images/Brand/Logo/Realized/Realized-Logo-Black-No-Margin-296x60-AMP.png", "width" : 296 }, "name" : "Realized" }, "thumbnailUrl" : "https://f.hubspotusercontent10.net/hubfs/733513/Images/photo/abstract/sack-laptop-portfolio-IS-1250426655.jpg" } ```