Owning rental properties is one of the many ways to generate passive income. Unfortunately, some notable drawbacks include the high upfront cost required to buy a property and get it ready to rent.

With high home prices and inflating costs, purchasing a rental property could require that you spend $100,000 upfront when factoring in the down payment, closing costs, and renovations needed before you can start renting the property. Meanwhile, there's no guarantee the investment will pay off if the tenants stop paying rent or there's a major unexpected repair.

On a more positive note, there are many lower-cost ways to start making passive income from real estate. Buying shares of a real estate investment trust (REIT), given their low costs (usually less than $100 per share), is a great place for beginners. Here are two great REITs for reliable passive income.

Invest in rental properties without doing any work

Invitation Homes (INVH -0.59%) is a residential REIT focused on owning and managing single-family rental homes. The company owns or manages over 100,000 homes across 16 top U.S. markets. It focuses on metro areas where jobs and the population are growing at above-average rates. That drives strong demand for rental homes, keeping occupancy levels high and rental rates rising.

You can buy shares of Invitation Homes for around $35 apiece. That's a fraction of the cost of one rental property. Further, instead of owning one home in one market, you'd own a tiny slice of a massive portfolio of rental properties diversified across several top markets.

The REIT's portfolio generates steadily rising rental income. It pays out a portion of its cash flow to investors via dividends, currently $0.28 per share each quarter ($1.12 annually). The REIT offers a dividend yield of above 3% at its current share price. Put another way, at that rate, you could generate $3 of passive dividend income for every $100 you invest in the REIT. The more you invest, the more income you'll collect.

That income stream should grow each year as the REIT raises rents across its portfolio and continues to expand its property count. It last raised its payment in December, increasing it by 8%. So, instead of the fluctuating income of a rental property (which could dry up if there's a vacancy or major repair), this REIT pays a dividend its investors can bank on.

Experience more income with this REIT

REITs can own many different types of rental properties. For example, Vici Properties (VICI -0.65%) focuses on owning or financing experiential real estate like gaming, hospitality, and entertainment destinations. It owns 93 experiential properties across the U.S. and Canada and has financing partnerships with a growing list of non-gaming experiential operators.

It leases its owned facilities back to the operators under long-term, net lease agreements. The company's net leases require tenants to cover all of a building's operating costs, including routine maintenance, real estate taxes, and building insurance. The rental agreements provide the REIT with steadily rising income that escalates at a fixed rate or one tied to inflation. Meanwhile, its financing agreements supply it with interest income and the option to eventually acquire the underlying real estate.

Shares of Vici Properties currently cost around $33 apiece. The company pays a quarterly dividend of $0.4325 per share ($1.73 annualized). That gives it a more than 5% dividend yield. The REIT has raised its payment in all seven years since its formation, including by 4.2% earlier this month.

That dividend payment should continue rising as Vici Properties expands its portfolio. For example, it has agreed to invest up to $950 million this year. It's providing funding to renovate and enhance The Venetian Resort Las Vegas and closed a loan secured by several Great Wolf Resorts.

Easy ways to start collecting passive income from real estate

While buying rental properties can be a great way to start making some passive income, the high upfront potential cost can put them out of reach for many beginners. On the other hand, REITs like Invitation Homes and Vici Properties provide an open door for anyone to start earning passive income from the sector. They have low share prices and pay steadily rising dividends, making them ideal for collecting income without all the hassle and costs of being a rental property owner.