Could This Be a New Way to Invest in Real Estate Without Buying the Whole Property?

[Richard Volkov]

I came across a new idea in the real estate space that's worth discussing. It's not about buying whole properties or even shares in a REIT, but instead purchasing rights to the income a property generates.

Here’s how it works:

• - Property owners keep full ownership of their property but can sell a portion of the income rights (like rent or a share of appreciation when the property’s value increases).
• - Investors buy those income rights in small amounts, making it possible to invest in real estate without needing a ton of money upfront.
• - Payments to investors are automated, so rental income is distributed directly without much hassle.

What I found interesting is that this solves a couple of common issues:

• - Property owners can raise cash (for renovations as an example, or any other need) without giving up control of their property.
• - Investors get access to real estate cash flow with lower costs and no landlord responsibilities.
• - The whole process is simplified—no co-ownership legal headaches.

I’m curious about the pros and cons of something like this. For investors, would earning passive income through property cash flow (without actually owning the property) be appealing? For property owners, would selling off some of the property’s income rights (without losing ownership) make sense in certain scenarios?

Would love to hear the community’s thoughts—especially from experienced landlords, property investors, or those who’ve explored fractional real estate investing before! Do you see a model like this catching on?

[Bill B.]

It sounds horrible. If I sell off 100% of the income rights what’s my incentive to keep it profitable? Heck, maybe I’ll give the property manager (me) a 100% raise and an all expenses paid vacation 6 times a year. Maybe the manager should have a company Tesla. If the income goes negative do I  ask you to send me money?

It sounds a lot like timeshares or partial ownership plans room the 1990’s and 2000’s. Great for the seller, really bad for the buyer.