Basic Rental Properties
Every since people have owned land or houses, individuals have made money by renting to others. Naturally, the land owner is responsible for the upkeep of his land, house, property taxes, and the mortgage. Many times, the landowner charges just enough to cover these costs, with no margin for profit until the house is sold. Hopefully, he will then have a big profit. Some property owners do charge enough to make a profit, however, even when they are still paying mortgage costs.
When someone does invest in rental properties, often his properties appreciate over time. If he ever decides to sell them instead of renting, he makes a nice profit.
One downside of this type of investing is the cost you incur in maintaining your property - including repairs, painting, fixing a bad furnace, or for other items. If you get a tenant who is not faithful about paying the rent, that could cause financial problems.