active investor or passive investor

Today I am going to share with you something that may very well surprise you.

Your success in real estate investing
hinges on this decision:

Are you an Active Investor or a Passive Investor?

It is in fact, the very first important decision that you will have to make. I would like to share why it is important and distinguish between the two if you are keen on your real estate investing being successful.

No matter if you are new to real estate or not, your success will depend on this decision.

Every investor wants to reap the benefits of a successful investment, even more so when it comes to commercial real estate like apartment complexes.

The potential for income is incredible as it flows in four forms:

  • Cash Flow
  • Building Equity – Principal Reduction
  • Property Appreciation
  • Tax Benefits

However, the decision that you have to make is whether you will be an ACTIVE INVESTOR or a PASSIVE INVESTOR.

It’s quite simple really, the distinction is in your approach and how involved you will want to be in managing the property.

ACTIVE INVESTOR – is one who has a hands-on approach, does everything with their property like managing day-to day activities such as leasing, doing repairs, dealing with tenants, etc.

Traditionally, an ACTIVE INVESTOR would be also out negotiating with real estate agents and spending countless hours looking for more deals. We could actually refer to this person as a “Landlord” in the traditional sense as he or she would ultimately be responsible for all aspects pertaining to their property and investment.

PASSIVE INVESTOR – is quite the opposite of the active investor. This person has more leeway in their approach.

For example, a passive investor is not bound by geographic location, is free to expand their real estate investment portfolio without limitations, and could be referred to as a “CEO” as the perspective is that of the bigger picture.

The main focus of a passive investor is on strategic partnerships and the global marketplace with larger investment groups.

I hope the above distinction is helpful to you.

Once you have made this distinction between what type of investor you are and the approach you will have, half the work is already done.

You will also be more focused on achieving your goals, as you will have saved a lot of time and effort.

Whatever type of investor you choose to be, remembering that there is no right or wrong decision, it should be according to what best suits you and is a question of personal preference.

As I said before, this was going to surprise you, well, there it is.

This first decision will determine how successful you are at real estate investing and how much more efficient you will be at achieving your investment goals. To realize your full potential, make this decision today…

So what type of investor are you, an Active or Passive Investor?

Feel free to contact me with your response.