Passive income is alluring, attractive and the word is very deceptive. 

For many investors passive income is the goal, it is the promise of financial security, of true wealth building, but it does not mean you can be  passive with your assets.

There are different degrees and roles of activities.  They can range from fully active to partially active.  The activity required is dependent on a lot of things like the property type. 

It is easier to be passive with a single family home with then a multifamily property, especially a small multifamily property.

A single family home usually attracts more stable tenants, there are fewer tenants and more importantly it's much easier to find a management company that will handle it precisely, because of the former reasons.

A medium to large multifamily property is a commercial property.  For the larger properties an in-house manager is hired, usually experienced and on the hook to perform.  The larger the property the larger the team.

That brings us to the most finicky of properties: the ones where long distance relationships usually don't work out.

Small multifamily properties like a duplex, triplex, fourplex or even something like 10 units are properties that are too small to have in-house management and too much to handle for most management companies and those that do usually tire quickly and let the property loose into rough world only to see is slowly deteriorate: lose appeal, lose value and pile on deferred maintenance.

It is these properties that need the most input from owners.  I would not recommend long distance ownership of a fourplex or the like, unless you have a very high class one which is quite rare in Greater Phoenix and even so you can't be completely passive.

From the easier to manage to the hardest your role as the owner and investor calls for participation.  Whether it's complete hands-on ownership or at least keeping an occasional eye out on the income/expenses: the books; some input is needed. 

Further more, there comes a point when an investment does not provide the best and highest return.  Most real estate investments reach that point when the equity position's cash on cash return is below the desired return.

By keeping an eye on the property the owner will know then that time comes and decide on the next move, but that's a subject we'll cover in depth in the future.

What I really want to do is dis-way investors from giving the property completely into the hands of another. 

I especially want to dis-way investors from purchasing input intensive properties like small multifamily properties and expect them to perform well: they won't and you may end up having a forced sale at a loss like so many that we have seen throughout the years. This is partially why the small multifamily sector in Greater Phoenix is such a disaster.