Why Rental Properties Are Still the Best Way to Build Wealth: From a Realtor & Real Estate Investor

If you’re serious about building wealth, and not just good income, but generational, sleep-well-at-night wealth, let me be real with you: buy and own real estate. More specifically, rental properties. Whether it’s a long-term lease or a short-term stay like Airbnb, I’ve found no better way to build lasting wealth than through this strategy. And I don’t say that lightly.

I say that as both a licensed realtor and an active real estate investor. I’ve guided homeowners through renovations that helped them sell for top dollar, and I’ve managed my own portfolio of both long-term and short-term rental properties. That unique combo gives me a bird’s-eye view of the market, and I can confidently say: real estate works when you work it.

Here’s why rental properties – whether you lease by the month or by the night – continue to be my favorite path to building true financial freedom.

1. Cash Flow: The Reliable Income Stream You Can Count On

Let’s start with the foundation: cash flow. This is the profit left after your expenses are covered: mortgage, taxes, insurance, utilities, and maintenance. In long-term rentals (LTRs), it’s a steady paycheck. You screen good tenants, sign a lease, and collect rent each month.

Short-term rentals (STRs), like those on Airbnb or VRBO, can be even more lucrative. When priced and managed well, I’ve seen STRs outperform traditional leases by 2–3x monthly. That said, they also require more involvement: cleaning, guest communication, calendar management. But when done well, the results can be incredible.

The bottom line? Whether it’s slow and steady or fast and flexible, cash flow builds a safety net and fuels your next investment move.

2. You Control the Asset

Here’s where real estate shines, especially compared to stocks or crypto: you control the asset. You can:

• Raise rent based on market conditions
• Update and add value through renovations
• Choose your ideal tenants or guests (make sure you fully understand and follow the rules for selecting tenants, though!)
• Optimize STR listings with pro photos, better descriptions, and good reviews

As a realtor, I’ve seen how a simple upgrade, like modern lighting or a fresh exterior, can improve perceived value. You’re not just waiting and hoping for market returns. You’re creating them.

3. Appreciation + Equity = Double Wealth Growth

With every mortgage payment, you’re building equity. Meanwhile, the market is (usually) doing its thing and increasing your property’s value. That’s two wealth-building streams: one from your own payments, the other from natural appreciation.

One of my STRs has increased in value by over $150,000 in five years, while it paid for itself and then some through monthly bookings. That’s the power of combining cash flow and appreciation.

4. Tax Benefits You Can’t Get Anywhere Else

Real estate is also one of the most tax-friendly investments out there. You can:

• Depreciate the property (even though it’s appreciating in reality)
• Deduct interest, insurance, repairs, cleaning services, supplies, travel, and more
• Avoid capital gains through a 1031 exchange

If you’re strategic and work with a good CPA, the amount of money you can legally save is substantial. These benefits aren’t just for big corporations – they’re for everyday hosts and owners like us. Consult with a CPA on your specific situation and strategy.

5. You Don’t Have to Be Wealthy to Get Started

When people find out I’m a realtor and investor, they often assume I started with a lot of money. Not true. My first property was a modest duplex. I lived in one unit and rented out the other – this is known as house hacking.

There are creative ways to get started, even in today’s market:

• Partner with a friend or family member
• Use an FHA loan with low down payment
• Buy a second home and rent it as a STR
• Tap into HELOCs or home equity for your first down payment (this is what I am working on now since we have built a few thousand in equity since purchasing)

Start where you are. Just start. The first property is the hardest. After that, momentum builds.

I share more strategies in another article, “30 Proven Ways to Fund Your First Short-Term Rental: From No Money Down to Creative Financing,” and “Could a DSCR Loan Help You Get Into The Short Term Rental Market?“

6. STR or LTR? The Realtor’s Take

As someone who personally and professionally loves real estate, here’s how I frame the choice:

• Long-Term Rentals (LTRs): Better for passive income, less management, lower turnover. Best in areas with steady renter demand.
• Short-Term Rentals (STRs): Higher income potential, but requires active management and hospitality mindset. Best in tourist destinations or with unique property features.

Personally, I own both. Some properties shine as 5-star STRs; others do better with long-term tenants. Having both in my portfolio helps diversify income and minimize risk.

7. Real Estate Is an Investment You Can Touch

This is one of my favorite things about it: you can walk into your investment. You can see it, touch it, upgrade it, and directly influence its success. Try doing that with a mutual fund.

You’re not just hoping for market gains, you’re driving them. As a realtor and consultant, I’ve worked with many buyers and sellers who’ve transformed outdated homes into income-producing machines. The power of owning and improving your space is unmatched.

Final Thoughts: This is How I’m Building My Future, and You Can Too!

I’m not just selling homes or managing bookings, I’m building a life of freedom and flexibility through real estate. You can too.

Whether you’re dreaming of quitting your 9-5, want a solid side hustle, or are thinking long-term legacy wealth, rental properties are one of the most proven paths to get there.

If you’re just getting started, or ready to scale, follow along. Ask questions. Stay curious. This community is here to support you.

And remember: real estate isn’t just about houses. It’s about building the life you want, one property at a time.

And I’m here to help. On this blog, I share everything I’ve learned: what’s worked, what hasn’t, what I’d do differently, and what I recommend to my clients every day as a realtor and investor. Ask me anything!

– KP