Note investing vs. Long Term Buy-and-Hold; which is better for building long term wealth?

[Michael L.]

I have been trying to think through this mental exercise a fair bit lately. My interest was rekindled when I read another BP's post earlier today on evaluating your investments, and asking yourself whether you have an investment or a part-time job. Don't get me wrong, I love my rentals, but without a PM it does at times feel like more than just passive investing.

So which is better for long term wealth building: notes or rentals? I had believed that it would be through rentals, and that is what I have been pursuing. But rentals do have their downsides - big capex, bad tenants, and local market factors can all affect returns in an unexpected way. On the flip side, appreciation can be a nice added benefit which will at least hedge inflation in most markets.

At this point I think they are both great options, just different. I'm not sure which is better for long term wealth building, but like anything else, it probably depends to some extent on the investor and the market (and a little bit on luck). 

I may dabble a bit into notes in the future to see how I like that niche.

What do the other BP's out there have to say?