I have toyed with the idea of owning rental property. My conclusion was that once management/taxes/upkeep taken into account the residual returns are the same or lower than broad equity in risk adjusted terms. My main gripe is that you are buying X properties with a variety of idiosyncratic risks, a lot of which you can not mitigate. Location is one - you buy a place and next thing you know the city decides to build a garbage processing plant next door. Or, for example, my apartment is in a building with the dumbest condo board in Manhattan and keeps bleeding money. So if you want exposure to various forms of real estate, the REITs market is there for you. There are exceptions to this, probably, but they require some real value-added from the investor. Like a handy guy can try buying distressed properties and renovating them.