How To Invest In Real Estate Without Money
When it comes to investing, very few options can go toe to toe with the real estate sector. In fact, if you compare real estate to the stock market you will see that it promises better returns without the burden of volatility that comes with stocks. For many people investing in real estate is a capital-intensive undertaking that requires you to develop or buy property. However there are other ways that allow you to invest in real estate with little or no money, and yes they are completely legal. In this article, we will show you these options and how they work.
1. Wholesaling
This is one of the most common and widespread ways to make money in real estate without using your own money. In fact, some real estate agents started their career by wholesaling properties. First, you have to find an individual who is interested in selling their property. You then sign a contract of purchase with the owner giving you the right to market and sell the property. You then look for a buyer who is willing to buy the property at a higher price. Once the sale is complete you get to keep the amount that is over and above the price the owner had signed on in the first contract. The main aim of real estate wholesaling is to sell the property before the time stipulated in the contract elapses. However to reduce your risk make sure you include a clause allowing you to walk away if you cannot find a buyer in time.
2. Lease option Sandwich
This is another inventive way to make money in the real estate space without putting your own money in. In simple terms, it is a form of subletting. A lease option sandwich is an arrangement where you sign a lease option with the owner of the property with the option of buying the property at any time within the contract period for an agreed upon price. You then find another person with whom you sign a lease option for the same property but at a higher amount. Say you lease the property for 3 years with the option to buy it for $1 million and you pay $3000 monthly rent. You then lease it to another person for two years with a $1.2 million option at $5000 monthly rent.
3. Find a partner
Every once in a while a great property comes into the market at a bargain. If you feel that you can get a good profit out of such a property but you don’t have the money then find a partner. He will provide the finances while you do the rest. After the sale is completed you will split the profits at the agreed percentage.
Investing in real estate is not all about the money you have. Sometimes with some creativity, the right connections and hard work you can become a player in the market and earn some profit in return.
If you are selling your house in Orange County, CA call us at 949-438-4343 for advice, information on the state of the real estate industry and the best prices.