Real estate has always been one of the most reliable ways to build wealth. The opportunities are endless, and whether you’re considering your first income property or looking at commercial real estate investments through a private fund or sponsor, these five signs can help you determine if now is the right time to start.

1. You’re Looking to Diversify Beyond Stocks and Bonds

If you’re already invested in traditional markets like stocks and feel some risk based on market trends, real estate may be a smart next move. Unlike stocks, real estate is a physical asset that acts differently in response to economic trends. It often holds or gains value during inflationary periods and provides the added benefit of steady rental income.

Real estate helps smooth out risk and bring a level of stability to your portfolio. Real estate doesn’t just add another layer of investment—it adds an entirely different asset class. If diversification is on your mind, you may be more ready than you think.

2. You Have the Financial Foundation in Place

Real estate requires capital—and not just for the initial investment. You’ll want to plan for reserves that can help with unexpected expenses, market downturns, or vacancies within your properties. For new and seasoned investors alike, a strong financial foundation, including an emergency fund and manageable levels of debt is important to your success.

In addition, many private commercial real estate deals are only open to accredited investors. Per the U.S. Securities and Exchange Commission (SEC) which regulates the markets and protects investors, this means having a net worth of over $1 million (excluding your primary residence) or annual income exceeding $200,000 ($300,000 with a spouse) for the last two years. These baselines are in place to ensure investors can take on the risks of more complex or less-regulated investments and not face financial hardship.

If you meet these standards—or are on track to—you may be in a position to access higher-return real estate opportunities in private markets.

3. You Want Passive Income Without Being a Landlord

The idea of earning income from real estate is attractive—until the thoughts of leaky roofs, late-night calls from tenants, and maintenance issues creep in. If you want the benefits of real estate without the burden of being a hands-on landlord, you’re not alone.

Fortunately, there are passive investment options, like private real estate funds or direct investments in properties alongside a seasoned sponsor, that allow you to invest in income-generating properties without having to manage them. With minimum investments often starting between $100,000 and $200,000, these funds pool capital from multiple investors to buy and operate large-scale commercial properties. Returns typically range from 8% to 15% annually, and investors benefit from scale, professional management, and access to deals they likely couldn’t pursue alone. You do give up some level of control over specific investments, but the trade-off can be worth it.

If you’re ready to let your money work for you—without doing the work—these types of investments could be the answer.

4. You’re Thinking Long-Term and Have a Strategy to Build Wealth

Real estate isn’t a get-rich-quick scheme—it’s a long game. Properties grow in value over time, and reinvesting cash flow or returns can compound your wealth. In addition, the tax advantages and interest deductions can significantly boost your overall return on investment.  So, if you’re thinking beyond the next market cycle and want to build lasting wealth, real estate gives you several options to help get there through creation of income, appreciation in value, and tax efficiencies which are all key elements of a winning long-term wealth strategy.

5. You’re Ready to Explore Alternative Investments

Many investors eventually hit a crossroads in their strategy: stick with traditional investments or look at alternatives that offer greater potential upside, more control, and diversification in their portfolios. If you’re curious about real estate as an alternative investment, especially commercial real estate, you’re already thinking like a seasoned investor who knows commercial real estate continues to be one of your best options.

Final Thoughts: Are You Ready to Invest in Real Estate?

If you found yourself nodding along to most of these points, it might be time to take the next step.  Not sure where to start? First, review your financial picture, understand your investment goals, and learn more about real estate funds. With the right strategy in place, you don’t just invest—you build a portfolio and a future path that works for you.