One of the most straightforward ways to get into real estate is to buy and hold a rental. Another popular strategy is flipping properties.
However, there are multiple ways to invest in real estate.
Business Insider has spoken with investors who are using less traditional strategies to hit financial independence. Here are three.
1. Private money lending. If you want to participate in the real estate space without actually buying and managing properties, one option is lending capital to other investors.
It’s one strategy that financially independent couple Carl and Mindy Jensen are using to continue to grow their net worth. Having spent years buying property and doing time-consuming “live-in flips,” they appreciate how passive lending can be.
The way it works is they’ll lend other real-estate investors’ money to rehab a house, for example, and earn interest on the loan. The terms are determined by the lender and borrower and vary from deal to deal. The Jensens said that they’re earning between 10 and 12% from lending.
“The private lending generates such a nice return that it’s difficult to be like, ‘No, we don’t want to have the easy money. Let’s go do another live-in flip,'” Mindy told BI.
2. Build-to-rent. Brannon Potts likes the idea of owning rentals but has found it challenging to make the numbers work in his area: “The resale market is a little bit harder to pencil out and work financially.”
His solution is to build his rentals. He admitted that the strategy is “a little more niche,” and time-consuming. He’s designing the layout and working with a builder to bring it to life — a process that can take up to nine months for a multi-family property. “But I’m seeing a lot more financial reward from it at this moment than doing the resale side.”
Courtesy of Brannon Potts
As of March 2025, Potts has 10 completed doors and said he’s averaging $330 a month per door. That’s about $40,000 a year of relatively passive income, as his properties are new builds and don’t require much maintenance or attention. He expects to hit financial independence once he gets to 20 doors, which he plans to do in the next five years and before turning 60.
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He’s earning more than just financial reward.
“I love building — to be able to put my fingerprint on a property,” he said. “I really wanted to be proud of what we did so that our tenants got something wonderful that they could live in and hopefully take better care of it because it’s just a little bit nicer than the ordinary.”
3. Real-estate syndication. With real-estate syndication deals, a group of investors pools their capital to purchase a single property managed by the syndicator.
New England-based investor and self-made millionaire Tess Waresmith owns rentals, but she started investing in syndications in 2023 and says the strategy comes with unique advantages: It opens the door to bigger investment opportunities and is much more passive than managing rentals.
“I check out the deal and make sure it’s something that feels good to me, and then when I invest the money, I’m hands-off,” she said. “I’m not involved in the day-to-day decision-making of the property. But as an investor, I get to benefit from investing in the larger unit properties.”
The Jensens, who are in two syndication deals, also appreciate the hands-off nature, but it can be difficult to predict your returns.
“The people running these syndications will tell you they’re expecting numbers, and it’s infrequently accurate,” said Carl. Keep in mind that the syndicator is “probably using their best, sunny-day scenarios.”
That said, “every syndication we’ve had has actually outperformed the original numbers.”
