Real estate is a class of "real property" that includes land and anything permanently attached to it, whether natural or man-made.You can invest in real estate directly by purchasing a home, rental property or other property, or indirectly through a real estate investment trust (REIT).
The most popular way is to buy an investment property and slowly build up your portfolio. Generally, there are two primary ways to make money from real estate assets — appreciation, which is an increase in property value over a period of time, and rental income collected by renting out the property to tenants.
Rental income is any payment you receive for the use or occupation of property. You must report rental income for all your properties. In addition to amounts you receive as normal rent payments, there are other amounts that may be rental income and must be reported on your tax return.