Tue Mar 04 2025, by Tyler Gardner

Real Estate InvestingFinancial AdvicePassive Income MythsInvestment RisksFinancial Planning

3 Reasons Why I Would Never Invest in Real Estate

I'm Tyler, a former financial advisor and portfolio manager, and now I create financial content for free so that you don't have to pay for it.

1. The Cost of Entry

In order to purchase real estate, you need money. And if you've tried to get money today, you'll know it's very expensive. With interest rates being at multi-decade highs, it's almost impossible right now to generate positive cash flow from rental income alone.

2. The Myth of Passive Income

If you're convinced that by investing in real estate you just magically have some passive income, time to put down the social media. Contact someone who's actually invested in real estate and find out just how actively they had to work to get to that passive gravy train.

3. Underestimating Expenses

Speaking of getting to that gravy train, new investors often underestimate expenses, overestimate rental income, and fail to account altogether for vacancies, repairs, and property management costs. So buying based on appreciation alone equals speculation.

And just remember, once you own something, it owns you. And I like to travel light.

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