Many of the people we talk with already believe real estate belongs in their portfolio. The harder question is how to own it. You can buy shares of a public company, put money into a private fund, join a syndication on a single property, or buy a building and run it yourself. Each path gives you exposure to real estate, but they feel very different once you are in them.
This guide compares the four most common paths on the things that tend to matter most: how easily you can get your money out, how much control you have, how much work it takes, and what you actually own. It is general education, not investment, tax, or legal advice.
The four main paths
1. REITs, listed and non-traded
A real estate investment trust, or REIT, is a company that owns and usually operates income-producing real estate, such as apartments, offices, warehouses, and self-storage. REITs let individual investors earn a share of the income from commercial real estate without buying a property themselves (Investor.gov, Real Estate Investment Trusts).
Many REITs are listed on a stock exchange, and you can buy them through a brokerage account, a mutual fund, or an exchange-traded fund. That makes them the most liquid way to own real estate. You can usually sell on any trading day.
The trade-off is that a listed REIT trades like a stock. Its price moves with the broader market and with investor sentiment, not only with the rents its buildings collect. You own a small slice of a large company with many properties, and you have no say in which buildings it buys or how they are run. On taxes, the SEC notes that REIT dividends are generally treated as ordinary income and do not get the lower rates that apply to some other corporate dividends (Investor.gov).
Some REITs are registered with the SEC but do not trade on an exchange. Investor.gov flags several risks specific to these: they are generally illiquid, it can be hard to know what a share is worth, distributions are sometimes paid from offering proceeds or borrowing rather than operations, and up-front sales commissions and offering fees often total about 9 to 10 percent of the investment (Investor.gov). If you are offered one, read those risks closely and ask how the fees are paid.
2. Private real estate funds
A private fund pools capital from investors and buys several properties, often over a period of years. Private funds usually raise money through private placements, the same unregistered offering framework used by most syndications (Investor.gov, Private Placements under Regulation D).
The appeal is diversification across several buildings and a manager who handles everything. The trade-off is that you are often committing to a strategy rather than to specific properties. In many funds, the manager decides what to buy after your money is in. You are trusting the manager's judgment on deals you have not seen yet.
3. Single-property syndications
In a syndication, a group of investors pools capital to buy one specific property, and an experienced sponsor finds it, finances it, and runs the business plan. Investors typically own interests in an entity formed just for that property, and they receive reports, a share of cash flow as described in the offering documents, and a Schedule K-1 each year (IRS, About Form 1065). Our guide to how a multifamily syndication works walks through the whole life cycle.
The main difference from a fund is that you see the building before you invest. You can read the offering documents for that property, look at its financials, and decide whether to participate. The trade-offs are concentration in a single asset and illiquidity, since interests in a private placement are usually restricted and hard to resell.
4. Owning a building yourself
Owning a rental property directly gives you full control. You choose the building, the loan, the rents, the vendors, and when to sell. It is also the least passive option on this list. Even with a property manager, you are the owner of record, you usually sign or guarantee the loan, and the decisions and the phone calls still come back to you.
In Washington, landlords also work within the state's Residential Landlord-Tenant Act, which sets out duties around maintenance, deposits, notices, and more (Washington State Legislature, Chapter 59.18 RCW). Owning well means knowing those rules and keeping up with changes to them. For many busy professionals, that is exactly the work they would rather hand to someone else.
How the options compare
Liquidity
Listed REITs are the easiest to sell. Non-traded REITs, private funds, and syndications are all illiquid to some degree, and Investor.gov advises anyone buying restricted securities in a private placement to be prepared to hold them indefinitely. A building you own outright can be sold, but a sale takes months and has real transaction costs.
Control and visibility
With a public REIT, you control only whether you own the shares. With a fund, you usually choose the manager, not the properties. With a syndication, you choose each property but not its day-to-day management. Direct ownership gives you all the control, and all the responsibility that comes with it.
Effort
Public REITs, funds, and syndications are designed to be passive for the investor. Direct ownership is a part-time job at best, and it can become a full-time one during a bad stretch with a roof, a vacancy, or a lender.
Who can invest
Anyone with a brokerage account can buy a listed REIT. Most private funds and syndications are offered under the SEC's Regulation D, and many are open only to accredited investors. For individuals, that generally means a net worth over $1 million excluding your primary residence, or income over $200,000 ($300,000 with a spouse or partner) in each of the prior two years with the same expected this year. Certain financial licenses also qualify (SEC, Accredited Investors).
Risk
Every option here can lose money. Public REITs carry market volatility. Private offerings carry illiquidity, limited disclosure, and reliance on the sponsor, and Investor.gov is clear that you should be able to afford a total loss in a private placement. Direct ownership concentrates all of the risk, including personal liability on the loan, in your hands.
Questions to help you choose
There is no single right answer, but a few questions usually point the way:
When might you need this money? If the answer is "possibly within a few years," illiquid options may not fit.
Do you want to pick properties or pick a manager? If you want to see the building first, a single-property syndication may suit you better than a blind-pool fund.
How much of your time are you willing to give? If the honest answer is "very little," direct ownership is probably not passive enough.
How well can you evaluate the operator? In any private deal, the sponsor matters more than almost anything else. Our FAQ covers several of the questions we hear most often.
What does your tax and estate picture look like? REIT dividends, K-1s, and direct ownership are taxed differently. Please talk with your own tax advisor before you decide.
Where we fit
Veritas Equity Partners is a Kirkland-based owner-operator, and we invest deal by deal through single-property syndications. We buy 30 to 100 unit workforce apartment communities built in the 1960s to 1990s in Pierce and Snohomish Counties, and we grow income by fixing operations rather than betting on the market. We finance with long-term, fixed-rate agency or bank debt, and we do not use bridge or floating-rate loans. Our strategy page explains why.
We chose the deal-by-deal model because we think investors should be able to look at each building on its own before they commit. Over sixteen years we have closed 21 deals and acquired 468 units, and we manage about $85 million in assets, with no realized losses on any deal. You can read about what we own on our portfolio page and how partnering with us works on our invest page.
Let's talk it through
If you are weighing these options and want a straight answer about whether a syndication fits your goals, we would be glad to help you think it through. There is no obligation in a first conversation. Book a Discovery Call and we will go through it together.
This website is for informational purposes only. It is not an offer to sell, or a solicitation of an offer to buy, securities. Any offering is made only through official offering documents, and only to investors who meet the requirements of that offering. Past performance does not guarantee future results. Investing in real estate involves risk, including the possible loss of capital.
Sources cited
Investor.gov (SEC Office of Investor Education and Assistance), "Real Estate Investment Trusts (REITs)" (definition, publicly traded vs. non-traded REITs, non-traded REIT risks and fees, tax treatment of dividends): https://www.investor.gov/introduction-investing/investing-basics/investment-products/real-estate-investment-trusts-reits
Investor.gov, "Private Placements under Regulation D: Updated Investor Bulletin" (August 17, 2022, updated September 21, 2026) (private funds and private placements, illiquidity, restricted securities, ability to weather a total loss): https://www.investor.gov/introduction-investing/general-resources/news-alerts/alerts-bulletins/investor-bulletins/private-placements-under-regulation-d-updated-investor-bulletin
U.S. Securities and Exchange Commission, "Accredited Investors" (individual financial and professional criteria): https://www.sec.gov/resources-small-businesses/capital-raising-building-blocks/accredited-investors
Internal Revenue Service, "About Form 1065, U.S. Return of Partnership Income" (Schedule K-1): https://www.irs.gov/forms-pubs/about-form-1065
Washington State Legislature, Chapter 59.18 RCW, Residential Landlord-Tenant Act: https://app.leg.wa.gov/rcw/default.aspx?cite=59.18