I’ve thought about investing in real estate for years. I’ve gone to numerous free dinners (from those who sell syndications, from those who sell private funds, and from those who sell oil and gas investments), and after I get full on chicken piccata and barbecue short ribs, the temptation to expand into this asset class sounds like such a great idea.
And it certainly can be.
WCI founder Dr. Jim Dahle has mostly had a good run of success in real estate. WCI columnist Margaret Curtis doesn’t regret her direct real estate investment (even if her tenant was almost immediately arrested on a drug charge). And others in the WCI community have found this asset class, whether through short-term rental empires or syndications, to be a worthwhile venture.
But something (maybe because of the risk or the oftentimes high minimum investments or just good old inertia) has prevented me from taking a cold plunge into the real estate pool.
As I’ve gotten older, I often wonder if I’m doing a better job of setting boundaries for not dealing with aspects of life that I don't enjoy. Or maybe I’m just getting lazier.
If it’s the latter, I wanted to create a scale of how the lazy person could invest in real estate and be satisfied with the result (from an earnings perspective and from an I-just-want-to-sit-on-the-couch-all-day perspective). If you, like me, want to finally start investing in real estate but don’t want to put too much time and energy into the project, here’s where you can turn.
Lazily Investing in Real Estate
To get a visual representation of how much work goes into different parts of real estate, here’s our oft-cited real estate continuum chart that compares the hassle, diversification, experience needed, and tax benefits of the different areas of the asset class.
Let’s go through some of the highlights and rate them on my Lazy Real Estate scale (1 being I-ain't- gettin'-I ain't-gettin'-out-of-bed-today and 5 being the hardest working, most highly motivated person you can imagine).
Short-Term Rentals, Long-Term Rentals, and Fix-and-Flips
As a lazy real estate investor, I’m avoiding all of these options. I’ve tried hard to improve my skills, but I’m no handyman (I consider it a personal victory when I can manage relatively basic plumbing and electrical tasks), so flipping houses is a no-go.
Short-term rentals might be OK if you have tons of extra time or if you have a partner interested in attaining Real Estate Professional Status (REPS), but you’d better like the hospitality business and/or not care what your Airbnb-hating neighbors think of you.
For several years, we rented out the townhouse we bought during my wife’s five-year residency, and it worked out OK as a long-term rental. We were slightly cash-flow negative most of the time, but we built equity in the home, we had 3-4 good tenants over the years, and we didn’t get many calls for a malfunctioning dishwasher or refrigerator. I didn’t like living 1,100 miles away from that responsibility, and I felt the house was a never-ending albatross around my neck. I was so relieved when we sold it, and I vowed never to become a landlord again.
I suppose you could put less effort into this area if you outsource all the work to a property manager, but then you’d just be cutting into your profits. If you want to be active in real estate, this is where you should put your time and money. If you want to be passive, you should take a pass.
Lazy Real Estate Scale: 5
Syndications
For several years, I liked the idea of syndications. I even made my way through the fairly dense The Hands-Off Investor. Syndications are the classic take-my-money-now-so-you-can-pay-me-more-money-later scenario.
But here’s what gives me pause.
- You have to do plenty of due diligence before you start your investment, and if you don’t know how to do that due diligence, you need to spend time either 1) reading and learning how to do it or 2) failing, losing money, and then learning how to do it. All of that sounds like work to me.
- Say you have $100,000 to invest in real estate, and you find a reputable company that requires a $100,000 minimum. That company invests your $100,000 into one apartment building. You end up with a chunk of your nest egg in an asset class that lacks any kind of diversity. If that apartment building fails, you’re out $100,000. I’d like more diversification than that.
- Even if the investment performs well, you probably won’t have control of your money for several years. This is an awfully illiquid approach to real estate.
If you want to be lazy, syndications are a solid approach, but you’re going to have to do plenty of work in the leadup to the investment.
Lazy Real Estate Scale: 3
Private Funds
Giving somebody money so they can pay me back more money later seems like a winning idea. Funds could be a good option. Similar to a syndication, you’ll likely need to be an accredited investor (or even be a qualified investor or qualified purchaser, two higher bars to clear) to participate in this sort of real estate investment, but putting money into a private fund (which will own multiple properties) provides more diversification than an individual syndication.
You’ll still need to complete your due diligence before you invest, but private funds have a low correlation with the stock market and oftentimes give you better returns.
From a how-much-work-do-I-really-want-to-put-in perspective, here’s what could make you squeamish: a large number of K-1 forms that will force you to pay more money to an accountant to file your taxes, that will force you to file in multiple states, and that probably will force you to file for an extension. I get stressed enough by making sure my taxes are finished by mid-April. Do I want to elongate that stress for another six months every year?
Lazy Real Estate Scale: 3
Turnkeys
If you want to pay somebody else to do all the work for you while enjoying the benefits of direct ownership, the turnkey model, which allows you to buy a property that already has a tenant in it with a team that’s already assembled to take care of the property, is a good one. As we’ve written before, here are the pros of turnkey real estate investing:
- It’s mostly a hands-off investment.
- You have full control of the property.
- You can invest from anywhere.
The disadvantages include paying a significant amount of money upfront (you are buying a house, after all) and that you won’t be diversified or liquid. But that all could be offset by the lack of work you'd need to do to make this investment.
Lazy Real Estate Scale: 2
Public REITS
Now, this seems relatively simple. If you want a steady income stream, portfolio diversification, and long-term capital appreciation, public REITS are a great idea. But a public REIT’s correlation with the stock market is relatively high, and they’re not at all tax efficient. Plus, you wouldn’t benefit from depreciation or 1031 exchanges like you would in other kinds of real estate.
The liquidity to buy and sell out of an ETF, the diversification, and the lack of K-1s, though, make REITs pretty darn tempting for the person who just can’t seem to find their way out of the BarcaLounger.
Lazy Real Estate Scale: 1
So, what comes next for me and slothfulness? Will I finally shake off the inertia and invest in a new asset class, or will I continue with my current asset allocation and make room in my brain for other activities? I’ll figure it out later, once I'm done with my current Netflix binge.
More information here:
How to Start Investing in Real Estate
The 7 Worst Ways to Invest in Real Estate
Money Song of the Week
I’ve had a surprisingly large number of conversations recently where I’ve lamented with friends and/or repair people that you can’t expect the large appliances for which we pay thousands of dollars to last longer than a decade. Sometimes, if you get caught with a lemon, it’s an even shorter life span for the fridge, washer and dryer, and microwave.
We’re no longer in the era where your grandparents’ fridge that they bought in 1975 is still plugging along or the microwave that has seen everything from 1980s Hungry-Man frozen dinners to early 2000s Hot Pockets lunches is still reheating your leftovers.
At least that’s what it seems like. Maybe it’s recency bias when it seems like your fridge’s condenser stops working every few years or your toaster produces smoke instead of a well-done bagel. But in those conversations about the declining quality of our everyday appliances, we tend to blame the companies that create crappier products that break more often so that we’ll be forced to buy another one in a couple of years.
That’s only part of it, according to the New York Times from 2025:
“It’s true that appliances don’t last as long as they used to—though the difference is probably not as dramatic as many people seem to believe. Although companies are partially to blame, the fault also lies with the unintended consequences of government regulations, price wars driven by global trade, and people’s own desire for increasingly sophisticated features requiring complex components that are far more likely to fail.”
Even if it’s partially our fault that products suck a little more than they did decades ago, we can always take solace in a piece of work like Guy Clark’s 1995 tune Stuff That Works. Clark isn’t really talking about your Whirlpool and Bosch appliances. He’s just making the point that we should bask in the objects and people on which we’ve always relied.
As he sings,
“I got an ol’ pair of boots and they fit just right/Well I can work all day and I can dance all night/I got an ol’ used car and it runs just like a top/I get the feelin’ it ain’t ever gonna stop.
Stuff that works, stuff that holds up/The kind of stuff you don’t hang on the wall/Stuff that’s real, stuff you feel/The kind of stuff you reach for when you fall.”
I don’t know anything about Guy Clark, but in doing some research on this veteran country singer, dubbed a King of the Texas Troubadours in a 2016 obituary, he’s often mentioned in the same breath as Willie Nelson, Townes Van Zandt, and Jerry Jeff Walker.
He sounds like a guy who knew a thing or two about a thing or two. He sounds like a guy who was probably smart enough to have owned the same refrigerator for decades upon decades.
More information here:
Every Money Song of the Week Ever Published
YouTube Short of the Week
Billie Eilish has resided in the cultural zeitgeist for less than a decade, but she’s already made a generational amount of money.
And she’s not afraid to call out the people who are much wealthier.
For what it’s worth, Eilish recently donated $11.5 million to a charity that looks at climate change and food insecurity. The last time Forbes looked at her net worth (in 2020), it stood at about $50 million.
Are you lazy about real estate? If so, how do you invest in this asset class? How do you motivate yourself not to be lazy?