Real estate can add diversification to your portfolio, provide a steady stream of income, and offer tax incentives. But how much should you invest? And is there a way to get started without having to come up with tens of thousands of dollars upfront?

Whether you’re looking to become a landlord or just add rental properties to your investment portfolio, it’s possible to start investing in real estate for less than you might think. From using conservative leverage to invest in a small number of properties, to JV partnerships, REITs, and crowdfunding, there are many options for investors with any amount of capital to spend on real estate. Also read

When determining how much to invest in real estate, you’ll want to consider your goals and the level of risk you are comfortable taking on your investments. If you are interested in renting out property, for example, you may need to factor in vacancies, maintenance costs, and other ongoing expenses that can potentially offset the rental income you’ll receive. The initial cost of the property should also be considered, since it will have an impact on the eventual profit you stand to make when selling the property.

Another important factor to consider is the overall market conditions at a given time. If there is a limited supply of available properties, the competition for those properties can drive up their sale prices, thereby increasing your potential ROI. Conversely, if interest rates are high or on an upward trend, it can have a negative impact on sales by deterring potential buyers.

Real estate is a popular investment option for many big investors, including insurance companies, public pension funds, and internationally recognized money management firms. These investors are known as the billion-dollar club, as they have allocated more than $1 billion to real estate assets. Despite this, you don’t need to be a Global 2000 firm to invest in real estate. The availability of new business models and online tools have opened up opportunities for investors to start investing in real estate with little or no money upfront.

Regardless of how you choose to invest in real estate, your goal should be to build wealth over the long term. In order to do that, you’ll need to be patient and understand that real estate is a illiquid asset, meaning that it won’t be easy to access your money in the short term. With this in mind, it’s essential to assess your financial situation and determine how much of your savings to dedicate to real estate over the long-term. Using Kubera’s real estate portfolio diversification analysis, you can easily compare your asset allocation to other asset classes, ensuring that your investments are optimally diversified across your portfolio. You can even set rebalancing alerts to ensure that your investment portfolio remains properly aligned with your personal finance goals. Start your free trial of Kubera today to see how it can help you optimize your investments and achieve your financial goals.