Most investors searching for real estate funds start with a familiar short list: a well-known REIT, a Vanguard or Schwab ETF, maybe an actively managed fund an advisor mentioned. Those are solid choices, but every one of them is built on publicly traded stocks, so your real estate rises and falls with the stock market.
Those options are only part of what “real estate fund” covers. The term spans three categories that work very differently: REITs, ETFs and mutual funds, and private real estate funds. We’ll walk through three top picks in each and show you how to tell which type fits your goals.
REITs give you real estate in a single share, and the stock market comes with it
A REIT (real estate investment trust) is a company that owns income-producing property. You buy shares through a brokerage account, and a REIT must pay out at least 90% of its taxable income to shareholders as dividends.
Individual REITs let you pick a property sector and collect dividends without owning a building. They’re also the easiest way in. You can start with the price of a single share, and there’s no requirement that you have to be an accredited investor.
ETFs and mutual funds fix the concentration problem of owning one REIT. But you’re buying a stock, so on any given day the price reflects how the stock market is performing, not just how the buildings are doing.
1. Prologis (PLD)
Prologis is the largest industrial REIT, with warehouses and distribution centers totaling about 1.3 billion square feet across 20 countries. Its biggest tenants include Amazon, Home Depot, and Walmart, and its leases are spread across roughly 6,500 customers. You’re getting a stake in the buildings that keep online shopping and supply chains moving, with a dividend yield of about 3.2%. What you give up is diversification. If demand for warehouse space cools, the whole position feels it.
2. Welltower (WELL)
Welltower is the largest REIT by market value, with a portfolio centered on senior housing and outpatient medical buildings. It has paid 221 consecutive quarterly dividends. The draw is a steady source of demand in an aging population. Running senior housing is operationally demanding, though, and its dividend yield, about 1.5%, is the lowest of these three options, so it suits investors focused more on growth than current income.
3. Realty Income (O)
Realty Income owns more than 15,500 properties, leased mostly to single tenants like grocery stores, convenience stores, pharmacies, and dollar stores. It yields about 5.2% and pays monthly, which is rare among REITs, and it has raised its payout for more than 31 consecutive years. Most of its leases are net leases, meaning the tenant covers property taxes, insurance, and upkeep, which helps keep income predictable. The trade-off is slower growth and heavy exposure to retail, which has to keep adapting to how people shop.
ETFs and mutual funds spread your risk across many REITs, but not away from the market
Most real estate ETFs and mutual funds are built from REITs: instead of picking one, you buy a bundle of dozens or hundreds in a single investment.
An ETF (exchange-traded fund) usually tracks an index automatically and trades throughout the day like a stock. A mutual fund is often run by a manager who picks what to own, and it’s priced once a day after the market closes.
Either way, it’s one of the simplest paths to hands-off real estate exposure.
4. Vanguard Real Estate ETF (VNQ)
VNQ is one of the largest real estate ETFs, charges 0.13% a year, and follows an index of U.S. REITs plus a few other real estate businesses, like the brokerage firm CBRE. One purchase covers nearly every corner of the publicly traded real estate market, from cell towers to apartment buildings. For many investors, it’s the default core holding. The flip side of owning everything is that you also own the sectors that aren’t performing well.
5. Schwab U.S. REIT ETF (SCHH)
SCHH charges just 0.07% a year, among the lowest costs in its category. Unlike VNQ, it holds only REITs, not other real estate businesses like brokerage firms. It’s a strong fit for cost-conscious investors who want diversified REIT exposure. The narrower index means a slightly smaller slice of the market than VNQ.
6. Cohen & Steers Real Estate Securities Fund
This is the actively managed pick: Cohen & Steers has specialized in publicly traded real estate since its founding 40 years ago, and this fund concentrates on a smaller group of stocks its team believes are best positioned. You’re paying for that judgment: expenses run from 0.75% to 1.10%, depending on which version of the fund, or share class, you buy. Some classes also carry an upfront sales charge. Higher fees mean the managers need to outperform a low-cost index ETF by more than the fee for you to come out ahead.
Private real estate funds trade daily liquidity for distance from the stock market
In a private real estate fund, you invest once and a manager spreads your money across many properties, either by owning buildings or by lending to the people who do. The manager picks the deals and runs them, so you don’t have to evaluate each one yourself. There’s no ticker and no daily price. Most are open only to investors with accredited investor status, and they typically ask for larger minimums and a longer commitment.
What you get in exchange is a closer connection to the real estate itself. If something goes wrong with a public REIT, you can’t call the CEO or ask the people managing your money what’s happening. You watch the share price. With many private funds, you can talk directly to the team making the decisions.
I often describe the difference as a plane and a submarine. Public real estate rides in the plane, so a bad headline means turbulence you feel right away. Private real estate moves below the surface, where results come from rent and loan payments rather than how the market moves that day. It still carries real risk, but its value isn’t affected every time stocks swing.
7. DLP Capital
DLP Capital runs several private funds focused on rental housing for working families, on both the lending side and the ownership side. Its lending funds target up to 10% to 11% net a year with monthly income, and its Building Communities Fund targets up to 14%. DLP reports that since launch, each of its four main funds has met its preferred return targets without principal losses. With high minimums, it’s built for larger investments.
Targets are stated after fees, which include an annual management fee and a share of returns above the preferred return.
8. EquityMultiple (Ascent Income Fund)
EquityMultiple is a commercial real estate investing platform, and its Ascent Income Fund is its income-focused pooled fund. Ascent invests mostly in senior commercial real estate loans (loans that get repaid first if a property runs into trouble) and pays distributions quarterly. Its minimum for new investors is $5,000, the lowest on this list.
Its payouts can vary with how the underlying loans perform. The platform also offers short-term Alpine Notes targeting up to 7.5% APY over 3 to 9 months, along with individual equity deals for investors who want to pick specific properties.
9. Freedom Notes: fixed-rate income starting at $25,000
This is our fund at Freedom Family Investments, so I’ll be straightforward about what it’s built to do and what it isn’t.
You can reach the people running your money. We’re a sponsor-operator, which means we own and operate the real estate behind our notes and put our own capital into the deals. When you have a question, you’re talking to the team making the decisions, not a customer service queue.
A fixed rate that doesn’t move with the market. Flagship Notes pay a fixed rate, distributed quarterly or compounded, and investors may target 8% to 14%* annually, depending on the offering and tier. The notes are backed by apartments, senior living, and self-storage, housing and storage people still need even when the economy slows. All investing involves risk, including the possible loss of principal.
A cushion between project returns and your rate. We look for projects that target 20% to 22% before investors are paid, while investors may target 8% to 14%*. That gap is designed to absorb a project that underperforms before it affects the investor. Targets are not guarantees.
Simpler taxes and a yearly exit. Flagship Notes produce interest income reported on a 1099 instead of a K-1, and they’re eligible for a self-directed IRA. After the first year, you have an annual window to exit. Consult your tax advisor about your situation.
Across more than 17 years of operating, there have been no missed investor payouts to date, according to Freedom Family Investments. Past performance does not guarantee future results.
The biggest differences come down to access, liquidity, and taxes
| Fund | Type | Annual income | Minimum to start | Who can invest | Getting your money out | Tax form |
| Prologis (PLD) | Public REIT | ~3.2% dividend yield | Price of one share | Anyone | Sell any trading day | 1099-DIV |
| Welltower (WELL) | Public REIT | ~1.5% dividend yield | Price of one share | Anyone | Sell any trading day | 1099-DIV |
| Realty Income (O) | Public REIT | ~5.2% dividend yield | Price of one share | Anyone | Sell any trading day | 1099-DIV |
| Vanguard Real Estate ETF (VNQ) | Index ETF | ~3.5% dividend yield | Price of one share | Anyone | Sell any trading day | 1099-DIV |
| Schwab U.S. REIT ETF (SCHH) | Index ETF | ~2.8% distribution yield | Price of one share | Anyone | Sell any trading day | 1099-DIV |
| Cohen & Steers Real Estate Securities Fund | Mutual fund | ~2% to 3%, by share class | Varies by share class | Anyone | Redeem any business day | 1099-DIV |
| DLP Lending Fund | Private fund | Targets 9% to 10% | $500,000 | Accredited investors | 90-day notice | 1099-DIV |
| EquityMultiple Ascent Income Fund | Private fund | 9.08% distributed yield | $5,000 | Accredited investors | 1-year lockup, then quarterly | K-1 |
| Freedom Notes | Private fund | Targets 8% to 14%* | $25,000 | Accredited investors | Annual exit from year one | 1099 |
*Flagship Notes returns are targets that depend on the offering and tier and are not guaranteed. Public yields reflect current dividend income only, not share price gains or losses, and change daily. Private fund figures are each manager’s stated targets or reported history, not guarantees. Third-party details come from each firm’s public materials as of September 2026.
Four questions that narrow nine funds down to the right one
These questions do most of the narrowing for you.
How soon might you need this money? If you want to be able to sell any day the market is open, REITs, ETFs, and mutual funds are your lane. If you’re an accredited investor and you can leave money in place for a year or more, private funds open up options the public market doesn’t offer.
How do you want your income taxed? REIT dividends are generally taxed as ordinary income, whether you own the REIT directly or through a fund. Private funds vary: some send a K-1, others a 1099. Private funds that own buildings, like DLP’s Housing Fund, can also pass along depreciation, a tax deduction for a building’s wear and tear. Lending structures like Flagship Notes can’t. A tax advisor can show you how each would affect what you actually keep.
Are you an accredited investor? If you are, private funds are available to you and worth comparing side by side with public options. If not, REITs and ETFs remain solid ways to add real estate to your portfolio.
Is this money for income, growth, or broad exposure? A monthly-paying REIT or a real estate income fund leans toward income. A growth-focused REIT or a private fund that owns buildings leans toward appreciation. A broad index ETF gives you a little of everything.
Not sure which type of real estate fund fits your goals?
A clarity call is a 30-minute conversation with our team. You can walk through what you already own, where Flagship Notes might fit alongside it, and what to ask any fund you’re considering.
It isn’t a sales call. The goal is to help you understand how Flagship Notes work and give you an honest read on whether this fits your situation, even if the answer is no.
Book a clarity call with Freedom Family Investments
This content is for educational purposes only and is not an offer to sell or a solicitation to buy any security. Any offering is made only through official offering documents to verified accredited investors. Private real estate investments involve risk, including illiquidity and possible loss of principal. Targeted returns are not guaranteed, and past performance does not guarantee future results. Consult your financial, legal, and tax advisors before investing.
