Investing for Monthly Income: 15 Investments That Will Make You Monthly Income in 2024

Looking for the top investments that pay monthly income, UK or otherwise?

Perhaps one of the best investments for monthly income is residential rental property.

A must-have for any serious investment portfolio, residential rental property investment has exploded in popularity over the last year and is a top contender for those looking at investing for income. UK property, in particular, is a hot item – thanks to its massive growth in income potential.

With residential real estate, investors will buy a property and rent it out to a tenant. This means that residential real estate delivers two forms of income.

1. Rental income – A regular monthly income stream that reached a record-high in the UK rental market in 2023. The average rent hit £1,279 per month in November 2023, according to HomeLet.
2. Capital growth – Otherwise known as capital gains or capital appreciation, capital growth is the increase in a property’s value over time. UK property prices increased at their highest rate in 2021 since 2004, reaching an average of £250k for the first time ever.

This makes property an effective solution for those thinking ahead to retirement, as investors can earn regular rental income and secure a huge profit when they sell their assets later down the line.

While this asset class can deliver an effective monthly income stream, you need to know that there are ongoing costs with real estate, including property management fees and interest payments if you use a buy to let mortgage.

Overall, we estimate that you’ll likely need a minimum initial investment of around £30k, including; property taxes, a BTL mortgage initial deposit, and a down payment of 25% if you want to secure an effective residential property.

You can learn more about property investment by reading our ultimate guide for 2024. You can also see if now is a good time to invest in property by reading our brand-new property guide.

Another way of securing passive income by making an investment in real estate is through student rental property.

You can buy student rental property in the UK in two main ways.

1. You can buy purpose-built student accommodation: Likely the top choice in 2024, with Savills reporting that over £5.77 billion was spent on PBSA in 2020 – a record-high.
2. You can buy a house of multiple occupancy, otherwise known as HMOs: Historically a popular choice, with various tenants paying rent and increasing the income generated.

Like residential real estate, student property is a top passive income investment, allowing investors to earn both rent on a monthly basis and long-term capital appreciation.

Student property can potentially offer some of the best monthly income funds out of all real estate assets thanks to high rental income and low property prices, typically below £100k – In fact, our student property, City Point, was available for purchase from only £59,995 and offered 8% NET rental yields.

While the minimum investment for student property is less, it also offers less capital appreciation potential than residential property, which is something to keep in mind for investors looking at retirement.

You will also need to pay additional fees, such as property management fees, when buying a purpose-built student apartment.

Overall, if you’re a buy-to-let investor looking for dependable income and want to invest money in real estate, student property is a top choice. You can learn more by reading our complete guide to student property investment in 2024.

Manhattan apartments can be an interesting solution for those looking for safe investments and wanting to know how to invest for monthly income.

A Manhattan apartment is a mix between studio apartments and one-bedroom flats.

Sometimes confused with a studio flat, Manhattan apartments are a studio with a secluded bedroom. As it is smaller, investors will then receive rental income, which is lower, based on the apartment’s size.

As a way to generate monthly income, Manhattan apartments can be a top choice as they are more affordable and less of an initial budget is needed to start investing.

However, opting for a Manhattan apartment could risk gaining less rental income than other property investments. Manhattan apartments are smaller than other properties, meaning you’ll be earning less than you usually would on an apartment.

But while rental income can fall behind other property investments, Manhattan apartments are more affordable, will pay a regular payment, and are very in demand if you want to re-sell.

A top choice if you want to buy real estate you can live in, holiday homes allow investors to rent out a house on a short-term basis to a holiday goer or tourist.

Typically listed on websites like Airbnb, those owning a holiday home, whether based in the UK or abroad, can live in their holiday home while travelling and rent it out when not in use.

However, if you wish to do this, remember that living in a home purchased with a buy-to-let mortgage won’t be possible. Likewise, if you buy it with a residential mortgage, you won’t be able to let out the property.

Investors can produce monthly income from a holiday home, which could be considerable depending on its size and quality. However, securing a BTL mortgage can be tricky, and you could encounter extensive void periods if the area’s tourism is based on seasonal demand.

Booming in popularity in recent years, eco-property is fast becoming one of the most popular ways of investing and ensuring demand from younger generations.

Eco properties are usually new-built projects designed and constructed with energy efficiency in mind.

Often hailed as one of the most exciting trends in UK property today, an eco-property can offer an investor the chance to make a safe and lucrative investment. For instance, studies show that renters are willing to pay more rent in order to live in a more energy-efficient home.

Although most investors make their biggest returns by holding onto property and selling it at a later date for capital growth, there are ways to use this contemporary asset to generate even bigger monthly income.

Firstly, investors can let out eco-properties at a premium rent and earn more monthly income. Secondly, eco-properties are future-proof and will stay in demand for years to come and earn you a monthly income while experiencing sizable capital growth.

According to Investopedia, Real estate crowdfunding is a more niche way to make a property investment in 2024 and is a rather interesting method of securing assets that pay monthly.

A property crowdfunding website is a platform that pools investors’ funds together to purchase a property.

Once the website generates enough cash, it will form a limited company, with all investors given a share in the company representative of the money invested. Learn more about how to buy an investment property with a limited company with our free guide.

This can be a top choice to generate a steady monthly income without spending the cash required for a full property investment.

One way to ensure a stable monthly income that can work out as a sizable return on investment is by investing in property in a high-yield area.

By researching high-yield areas before investing, you will likely see better returns and earn income quickly. The rental yield of a property can be worked out by dividing the yearly rental income by the property’s value and then multiplying by 100 to get the percentage.

Without thorough research, you may end up losing out on income. Be sure to speak to a property expert to see if your area of interest is your most lucrative investing location for monthly payments.

The best way to ensure a sizable monthly income is to make more than one buy-to-let investment. Investors can use income from one property investment to fund another or invest in several affordable properties rather than one expensive one.

By investing in these assets, return potential is far higher than other investment strategies, but the trade-off is that managing several properties can be a lot of work. For this reason, many investors collect passive income using a property management company that will perform landlord duties on their behalf.

Due to the low risk, the UK property market is a top alternative to other investment strategies and can deliver a decent monthly income stream in addition to returns from capital appreciation in the future.