Are These Unusual Ways To Invest In Real Estate In Retirement Secret Money Makers?

Investing in real estate generally means a few tried-and-true techniques. Retirees are on a fixed income and usually look to generate income while not risking their principal. However, it can also be a time when people have the time to explore things they may not have tried before.

The traditional path for retirees often involves investing in real estate investment trusts (REITs). Many REITs pay a high dividend which delivers a steady income stream. They are also traditionally low risk. REITs can beat the S&P 500 and the dividend may help protect a retiree’s income against the negative impact of inflation.

Don’t Miss Out:

• A billion-dollar investment strategy with minimums as low as $10 — you can become part of the next big real estate boom today.
  This is a paid advertisement. Carefully consider the investment objectives, risks, charges and expenses of the Fundrise Flagship Fund before investing. This and other information can be found in the Fund's prospectus. Read them carefully before investing.
• Commercial real estate has historically outperformed the stock market. This platform allows accredited investors to invest in commercial real estate, invest today for a 1% boost.

House Hacking Isn't Just For New Homeowners

House hacking is often a way for younger people to get into real estate investing. The term refers to buying a house, generally one with a duplex or finished basement, that has room for an additional tenant. For older people, it may not mean buying a new house but finding a way to make additional space within your home pay off.

This can take a variety of forms. It can be a separate unit rented to a long-term tenant or a single bedroom rented out either short-term or long-term. Retirees can also consider renting out storage space like attics or basements. They can also rent parking spaces or even put their swimming pools or backyards up for rent through a service like Swimply. 

"With an impending loss of income, retirees who would like to keep their homes instead of downsizing might want to consider house hacking. This involves renting out a portion (or portions) of your home while you still live in it. Retirees can rent out extra bedrooms to other retirees. This will not only replace lost income but can help to ward off loneliness," Ryan Barone, CEO of RentRedi, a property management software company, told Benzinga. 

Barone added that retirees can also convert parts of their homes into spaces for social gatherings that can be income-generating. He suggested building an exercise room or crafting area and hosting classes. This can make money and help keep retirees active. 

Beyond Residential Real Estate

Most individual investors who are directly investing look for homes or buildings to generate income. But there are a wide variety of options such as investing in storage units or even looking at land as a space for parking lots. It can be challenging for inexperienced investors but buying land may be cheaper than getting into the world of residential real estate investing. 

Barone suggested another option: finding a property that can be rented out for events. So many people have dreamed of running their own inn in some cute rural town and there is even a name for it, "Newhart" Syndrome, named after the television show in which Bob Newhart runs a charming Vermont inn. But Barone's take on it is slightly different because instead of catering to guests, you would just host events.

See More:

• This billion-dollar fund has invested in the next big real estate boom, here's how you can join for $10.
  This is a paid advertisement. Carefully consider the investment objectives, risks, charges and expenses of the Fundrise Flagship Fund before investing. This and other information can be found in the Fund's prospectus. Read them carefully before investing.
• Investor alert: Triple-net properties can put a check in your pocket every quarter—a can’t-miss opportunity for accredited investors.

"People are willing to pay top dollar for space to host large events such as weddings, graduation parties, baptisms, milestone birthday parties, retirement parties, other major celebrations and even corporate meetings and conferences," he added. "Properties with expansive, beautiful and/or unique landscaping make good rentals for outdoor events but can also be rented out for photography shoots or as on-location filming spots."

Your Dream Portfolio Without The Landlord Headaches

While some of the ideas above are perfect for active retirees, they may not suit those who are older and staying close to home. One way to invest in real estate without having to own and maintain properties is through fractional real estate investing. 

Several fractional real estate platforms let you choose from various properties and spread out your investment among multiple homes. One way to do this is through Arrived Homes, a company that allows investors to take small shares in homes that are rented out to short and long-term tenants. 

The recent Federal interest rate cuts may only increase the value of building a portfolio this way. “Lower mortgage rates make homes more affordable but prices are still driven by supply and demand. As more homes become available, prices are expected to stay steady, creating a good environment for consistent returns without big price changes. With savings accounts offering less interest, many investors may turn to real estate for better returns,” said Cameron Wu, Arrived VP of Investments.

Interest Rates Are Falling, But These Yields Aren't Going Anywhere

Lower interest rates mean some investments won't yield what they did in months past, but you don't have to lose those gains. Certain private market real estate investments are giving retail investors the opportunity to capitalize on these high-yield opportunities and Benzinga has identified some of the most attractive options for you to consider. 

Arrived Homes, the Jeff Bezos-backed investment platform, offers a Private Credit Fund. This fund provides access to a pool of short-term loans backed by residential real estate with a target of 7% to 9% net annual yield paid to investors monthly. The best part? Unlike other private credit funds, this one has a minimum investment of only $100. 

Don't miss out on this opportunity to take advantage of high-yield investments while rates are high. Check out Benzinga's favorite high-yield offerings. 

Wondering if your investments can get you to a $5,000,000 nest egg? Speak to a financial advisor today. SmartAsset’s free tool matches you up with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.