Grainger (LSE:GRI) is a UK-listed real estate investment trust (REIT). With a share price of £1.94, it offers investors the opportunity to enter the property market for less than £2.

It’s no secret that the hardest part of buying a home is often coming up with a deposit as prices continue to rise. However, I think it could be a shrewd way to build wealth to facilitate this process.

Construction of the deposit

Trying to come up with a deposit to buy a home can be a soul-destroying experience, and we all know why. Despite higher interest rates over the past few years, real estate prices continue to go up.

Over the last 10 years, the average house price in the UK has increased by around 50% and the average wage has increased by around 4%. To forget Netflixgym memberships and whatever else – the equation just doesn’t work.

Source: Trade Economics

There are many theories as to why real estate prices keep rising – I certainly have mine – but that’s a conversation for another day. What matters now is what to do with it.

To avoid being left behind, prospective first-time buyers need something that can keep pace with rising home prices. I think it’s worth checking out Grainger as a potential answer.

Ready-made portfolio

Grainger owns and rents a portfolio of over 11,000 homes across the UK. About half of them are located in London, where demand always seems to be exceptionally high.

Source: Grainger Investor Relations

Simply put, it is a way to invest in real estate. So unless something strange happens, your investment in the company should boost as the value of its portfolio increases as house prices boost.

There are several reasons why this may not happen. One of them is the possibility of changing lease regulations, which could generate many unforeseen costs if Grainger has to constantly modify its buildings.

Other things being equal, your business investment should be able to keep pace with the growing real estate market. And we haven’t even gotten to what I consider the best.

Rental income

As a REIT, Grainger is required to return 90% of its taxable income to shareholders. Therefore, investors not only participate in the boost in real estate prices, but also receive cash dividends from their activities.

Please note that tax treatment depends on each client’s individual situation and may change in the future. The content of this article is for informational purposes only. It is not intended to be and does not constitute any form of tax advice.

Dividends are never guaranteed, but they have grown steadily over the last decade. The company says that many tenants stay in its properties for longer.

Grainger also has massive plans for future expansion. A future pipeline of around £1.3 billion means the company intends to add a further 37% to the value of its existing portfolio.

In a market where prices only seem to go up, that could be worth a lot. And investors can participate in this growth by purchasing shares of the company without having to pay a huge deposit.

If you can’t beat them…

First-time buyers in the UK appear to be at a structural disadvantage – and this has been the case in recent years. However, investing in real estate through REITs is an idea worth considering.

Owning shares in Grainger could facilitate future buyers avoid being left behind by rising home prices while earning additional passive income. And this is not the only possibility worth considering.