Commercial real estate investor Michael Eisenga discusses what a passive real estate investor is and what it takes to become one.
COLUMBUS , WISCONSIN, UNITED STATES, July 12, 2021 /EINPresswire.com/ -- Michael Eisenga is a businessman who has successfully invested in commercial real estate and considers finding and improving profitable investments one of his passions. During his most recent investment hunt, Eisenga says that he has centered his attention on sparking development in smaller communities through assisting living facilities.
When choosing to invest in real estate, Eisenga remarks that interested individuals should consider what kind of investor they would like to be, such as an active or passive real estate investor. Active real estate investing is when the investor is actively involved in the maintenance and management of the property. An active real estate investor rents out a property and manages the rent and tenants, maintenance, and property as a whole. A passive real estate investor is primarily uninvolved with everything except for contributing funds. The term passive stems from passive income, which is used to describe automated income.
Passive real estate investing is great for those wanting to invest in the real estate market but who might not have the time to manage a property. In fact, the least amount of experience is required for passive real estate investing, and this investment path provides fewer frustrations while granting more liquidity and diversification.
In passive real estate investing, there are two primary methods. Direct passive real estate investing is where the investor buys a section of property or an entire piece of real estate to then rent it out. During this method, the investor usually becomes hands-off by hiring a property management company. Indirect passive real estate investing involves the person investing to putting money in a real estate related mutual fund or a REIT (Real Estate Investment Trust). An indirect passive real estate investor does not need to worry about finding and hiring a management company as the method does not involve a particular property.
There are several different ways to become a passive real estate investor. An investor can get into passive real estate investing by investing in REITs, real estate funds, crowdfunding, or considering a turnkey rental property. REITs are broken down into three primary types: equity REIT, mortgage REIT, and hybrid REIT. Depending on how shares are bought and sold, REITs can be further broken down into these categories: publicly-traded REITs, public non-traded REITs, and private REITs.
About Michael Eisenga
Michael Eisenga is a successful commercial real estate investor with a banking and finance background and is the former mayor of the City of Columbus. As a President of both American Lending Solutions, a mortgage lending company (he founded and operated from 2000 to 2018), and First American Properties, he has a track record of creating and operating successful businesses. Mr. Eisenga is also devoted to property development and construction, primarily serving smaller local communities. Especially in the senior housing sector.