Johnny Depp was able to save his two West Hollywood homes as millions of Americans face zombie foreclosure fate — here’s how to stay invested in real estate without an expensive mortgage

Last year, a $10 million loan enabled Depp to save his two West Hollywood homes from foreclosure, a fate an increasing number of Americans are currently grappling with. Data from Q1 2024 shows more than 67,000 U.S. properties started the foreclosure process, up 4% from a year ago.

So, the question is whether now is a good time to invest in real estate? Some experts remain optimistic.

“Q1 2024’s foreclosure data reveals a market in transition, with slight increases in filings and starts, alongside a notable decrease in REO properties,” explained Rob Barber, CEO at real estate data firm ATTOM, in April. “Homeowners continue to hold significant equity, contributing to a persistently hot housing market.”

Here are a few ways to do just that, even if you’ve been priced out of buying a home in the current market.

Residential real estate

In Johnny Depp’s case, his troubles came with residential real estate. For most readers, that’s going to be the biggest area of concern, given that the typical American household reportedly has 70% or more of its net worth tied up in its principal residence.

A recent report by ATTOM shows that roughly 1.3 million “zombie” residences are currently vacant, with pre-foreclosure properties rising more than 20% year-over-year. That said, residential real estate has historically proven to be a very solid long-term asset to hold. Data from 2023 shows that since 1970, the typical American home price has tripled.

Homeownership can also be viewed as a forced savings account, where paying one’s mortgage on a monthly basis builds equity over time, which can be utilized in retirement. Those renting won’t see those benefits over time.

But one way you can benefit from the rental market is through Arrived.

Backed by world-class investors like Jeff Bezos, Arrived allows investors to buy shares of rental homes and vacation rentals without taking on the similar responsibilities of direct homeownership and property management.

Start by browsing a curated selection of homes, vetted for their appreciation and income potential. Once you find a property you like, choose the number of shares you want to buy.

You can get invested with as little as $100 — a price tag that might look more appealing than the one associated with owning and managing a property yourself.

More alternatives to buying property

Commercial real estate

Perhaps the least popular asset class out there, but the one with some of the best longer-term returns, commercial real estate is starting to generate buzz among certain investors.

Why? Commercial real estate (particularly office and other light commercial assets) are down big. For value investors, that’s the kind of buying opportunity worth perking up over. There are certainly many options for investors looking for exposure to this asset class.

If you’re looking to make a larger investment, one option is First National Realty Partners (FNRP), an investment firm that provides accredited investors the ability to benefit from grocery-anchored, multifamily and industrial commercial real estate assets.

FNRP gives you access to necessity-based real estate. This means the properties are essential to the local community, often leased by national brands like Krogers, Walmart, or CVS, and are more likely to stand the test of time amid economic change.