You do not need huge capital to find and execute lucrative deals. Make money with real estate in many ways and even the readers without much start-up capital will get their money’s worth…
Real estate may have generated more fortunes and wealth than any other industry…
Yet some people remain sceptical when they have to take the first step themselves.
Most people think that they need a large initial capital to make money in real estate, but this is not always the case.
Find out more about all the possible ways to earn money with real estate below!
Table of Contents
- 1 What you DO need to make money with real estate
- 2 What you DO NOT need to make money with real estate
- 3 How to earn a living investing in real estate?
- 3.1 How can I make money with real estate without own capital?
- 3.2 How does investing in real estate work?
- 3.3 Is it a good idea to invest in real estate?
- 3.4 What is a property finder in the real estate sector?
- 4 Nine strategies to earn income with real estate
- 4.1 Long-term rental of residential property
- 4.2 Renovate properties and sell at a profit – How to make money with real estate?
- 4.3 Leasing/renting with a purchase option
- 4.4 Concluding and reselling sales agreements
- 4.5 Strike before a forced public sale (foreclosure sale)
- 4.6 Make money with real estate for holiday rentals
- 4.7 Taking out a short-term loan from private investors
- 4.8 Commercial real estate – Make money with real estate in B2B sector
- 4.9 Ready-made investment property to replace the savings account – How to make money with real estate?
- 4.9.1 Why choose carefree investment property?
- 4.9.2 Biggest advantages of ready-made yield properties
- 4.9.3 Offer of investment property with guaranteed rental
- 188.8.131.52 Brussels real estate – Value for money with appreciation potential
- 184.108.40.206 France as a tourist hotspot
- 220.127.116.11 Germany as a safe haven – Make money with real estate with rental guarantee
- 18.104.22.168 Sweden – Family property with spacious gardens
- 22.214.171.124 Spain (Costa del Sol)
- 126.96.36.199 Greece (Samos)
- 188.8.131.52 Montenegro – Growth destination with many opportunities
- 184.108.40.206 United States
What you DO need to make money with real estate
The only superpower you need is the ability to find money.
And we often don’t even talk about a lot of money to get started.
If you know what you are doing, you can make money with real estate even as a beginner with limited starting capital.
You do not need a large initial capital to make money in the real estate business. But you need knowledge and you need to learn the tricks of the trade.
Most (young) people think that making money online as an Internet entrepreneur is easier than it is to make money with real estate.
Unfortunately, both are very difficult if you do not know what you are doing.
But once you get to know the general and more specific details of the real estate sector, you can make (big) steps forward.
In this context, it is also interesting to reflect on some real estate myths:
What you DO NOT need to make money with real estate
You do not necessarily need a loan
Even with a low or outright bad personal credit score (or credit history), there are ways to keep going, provided you are committed enough.
Some of the methods discussed below are not at all based on taking out a loan (mortgage or bullet).
In fact: Many successful property investors have started their adventure without taking out a loan (and even with a bad personal credit situation).
You do not need significant capital
You do not need a large capital to make money with real estate, apart from maybe a few hundred euros to get started.
Of course, this means that you have to go for the lower priced houses or problem houses as an intermediary.
And that you will have to resell it contractually at a profit (see below) by putting a buyer in touch with a seller.
An alternative is to identify wealthy individuals who can help you land and finance certain deals (in exchange for a slice of the cake, of course).
Maybe you have a rich sugar aunt in the family who can’t keep her fortune in the bank?
Pledging is not necessary
Another big misconception is that you need to have accumulated assets to put up as collateral before you can finalise a contract or buy a piece of land with the help of financing.
However, you do not need such assets (properties, accumulated reserves in savings plans or group insurance policies, etc.) to be pledged!
You need to understand how creative financing of real estate works.
Unfortunately, most people who dream of making money from real estate immediately stop their plans because they have a certain idea of what it would take to get started.
How to earn a living investing in real estate?
When it comes to real estate, there are two ways to generate money.
You can generate passive income from real estate by buying something and keeping it in your portfolio as a rental property and investment object.
Alternatively, you can generate an active income by trading contracts as an intermediary (putting seller and buyer in touch), carrying out renovations or adding value in another area – such as designing project development deals.
This can seem very overwhelming at first, but as you gain experience, it becomes less and less intimidating.
When most people think of making money in the real estate sector, they ask the following types of questions:
How can I make money with real estate without own capital?
You can use a number of techniques to invest in real estate without liquidity, including the following:
Seller financing to (partially) finance real estate purchase
Seller financing in the context of a real estate transaction is the situation where a real estate deal is structured in which the seller offers you a spread purchase option.
This is called seller financing and it means that you only have to be able to pay part of the purchase price instantly.
You can pay off the rest in instalments at a market rate of interest.
Selling off other (superfluous) property and assets
You might consider including certain other assets you own in the deal.
Or sell them and convert them into cash to have extra liquidity.
Examples of such assets and properties are cars, motorbikes, art, jewellery, branded clothes, surplus furniture and electronics, and so on.
Engaging with a wealthy investment partner
It is not because you do not have enough capital that you cannot get started.
Consider going with a silent partner, a party that is wealthy enough and does not want to interfere with the details of the implementation.
A silent investor injects capital and in return will receive a piece of the pie and this in a passive way. You do all the work and the investor does nothing.
But another way of looking at it is the following: Without the investor, you cannot even do your job.
Consider this route more as a springboard to greater financial autonomy in the future.
Taking out a loan from a financial institution (traditional or online bank)
It may be that you currently have no or insufficient liquid assets at your disposal.
In other words, there may not be enough euros in your bank accounts to move quickly.
Don’t panic in such a case!
You have most likely built up other asset components that you can use as leverage in order to still secure a bank loan for a buy-to-let property.
Things that definitely qualify as own input are:
- Accumulated pension capital in a private savings plan
- Capital accumulated in certain savings and life insurance policies
- Your personal home that has already been fully or partially repaid
- Capital accumulated in a group insurance of work
If you can also prove that you earn a professional income, then you will most likely find a bank that wants to support you with a smart financing of the investment property in question.
How does investing in real estate work?
Investing in real estate works through the concept of positive cash flows if you want to make money directly from real estate.
This means that your income must be higher than your expenditure in terms of your real estate activities.
Pursuing positive monthly cash flows works for both long-term residential and commercial rental properties.
It is also the ideal to be pursued for properties used for short-term holiday rentals.
Is it a good idea to invest in real estate?
From a historical perspective, the answer is a resounding one: Yes, absolutely.
Real estate undeniably remains one of the sources of income (apart from business ownership) that has created the greatest fortunes and wealth since time immemorial.
What is a property finder in the real estate sector?
This is an individual who skims the market looking for deals and bargains.
Such a person often has a good contact with one or more professional buyers such as renovators or project developers.
The way such a property finder searches the market for house bargains is quite simple.
As a finder, one never becomes the owner of the property in question; one functions purely as an intermediary.
The fee is either a fixed amount per property, or a variable amount calculated on the purchase value of the property, or a combination of both methods of remuneration.
This is a way to make money in the property market without capital, without much risk.
It is much easier than buying, renovating and selling a property yourself.
Having said that, let’s move on to the official list of 9 methods of earning income from real estate.
Depending on the strategy you choose, you will then be able to count on a passive or active income arising from your real estate activities.
Nine strategies to earn income with real estate
Long-term rental of residential property
One of the most common methods of making money from real estate is to buy a property and hold it in portfolio for the long term.
During the entire period that the property is your property, you rent it out.
So this is actually a strategy of buying residential rental property and keeping it in portfolio as a yield property.
People and families always need a place to live.
If you want to make money from this, it means that you will have to intervene in the residential property market in order to buy rentable or already rented properties.
Of course, you should always do the right research to find a suitable property, always keeping the following key principle in mind: location, location, location.
Yes, you have probably heard it before, but location is everything in residential property.
This principle applies not only to an increase in the value of your property over time, but also to your ability to rent out your yield property smoothly and quickly to a long-term tenant.
When considering long-term residential rentals, look out for a good location. This is much more important than the current state of the property.
Even more so, neglected houses or flats in prime locations can be one of the best investments you can make.
This involves a more traditional approach to making money in the local property market.
You buy a property with a limited contribution of your own (you can finance the rest with a mortgage or bullet loan).
And then you keep that property in your portfolio for the long term.
Depending on your personal situation, you can finance such a property without or with very limited equity.
In other words, you can often finance a yield property to a very large extent through borrowed capital such as a mortgage or a bullet loan.
And this is certainly the case when it concerns an already rented yield property that already generates periodic income.
If there is already a positive cash flow behind a rental property, it can be a super investment.
However, these rental properties are not so easy to find, unless the owner has to get rid of them for personal reasons.
Think of a divorce, imminent death or personal bankruptcy that prompts the current owner to sell the property in order to have more liquid assets at his disposal.
Renovate properties and sell at a profit – How to make money with real estate?
The real estate niche of refurbishing and selling has been growing well in recent decades.
Thanks to the popularity of television programmes in which homes are renovated for private use or for sale, more and more private individuals are venturing into renovation projects of a buy-to-let property or yield property.
While there is certainly a lot of money to be made by buying cheaply, renovating and adding value and then selling with a capital gain, it can be quite difficult to get started.
If you do not have the knowledge and experience, you may end up buying a pig in a poke when you choose the wrong property.
You need to learn exactly what to look for and what not to look for when looking for a suitable property to renovate.
A good tip: Look for the ugliest houses in the most beautiful and/or best located neighbourhoods. This is where the real added value lies.
Another problem, apart from finding such hidden gems without having good relations with real estate agents and notaries, is being able to objectively and correctly estimate the value of a property after the renovation works.
How much is a house or flat worth once you have invested in repairs and other refurbishments?
How to value and appraise real estate? To determine this accurately, you need strong ties to a reliable general contractor.
Together with this party, you will have to make an inspection of the property in its current state.
Also beware of emotions that may run high during a public sale.
While it may sound appealing to some to buy a property they have never inspected themselves at a public auction (auction sale), you can easily lose money on such a transaction if you do not know what you are doing.
Finally, the following… Making money by buying, renovating and selling real estate can be relatively easy, provided you can properly estimate the underlying renovation costs and the potential value after refurbishment.
Another good piece of advice for beginning property entrepreneurs: Don’t take on too much!
And more importantly: Find creative ways to help others in the real estate sector.
After all, success as an investor in real estate has just as much to do with creative problem solving as it does with good financial calculations.
Leasing/renting with a purchase option
Purchase options are a good way to get started in real estate without having to invest significant capital and without having to present a good credit score.
You simply rent a property (as a company or as a private individual) with an option to buy it later at a predetermined price.
This usually works well when the specific property market is on the rise, as you can then purchase the property at the pre-agreed price at the end of the journey.
Read: you can buy the property at below market value if the property market has climbed well in the meantime.
If the housing market is rising substantially, you can buy the property in question at a discount.
You can also resell this purchase option and your purchase rights to another party if the time is right.
This strategy counts on rising, ascending property prices.
Such an option is only worth something if there is effectively a bull market in the real estate sector for many years.
Otherwise, you have nothing to lose with such an option. Even as a private tenant, you can check whether you cannot have such a purchase option included in your lease.
Feel free to ask, and maybe your future landlord will grant your wish…
As long as it is merely an option to purchase and as long as it is not expressly stipulated in writing that you are obliged to purchase at the end of the lease, you can only make financial progress and profit from real estate with such an option!
Concluding and reselling sales agreements
Another way to make money with real estate without putting in a lot of capital yourself is to conclude and resell sales contracts.
In other words, you first enter into a sales agreement yourself and then transfer the rights of that sales agreement to another buyer.
Using this technique, you only need to find a seller who needs money fast and a buyer who is motivated to buy at the right price.
As an intermediary, you bring both parties together and your job is done.
Although finding a seller who is in (financial) difficulties may seem difficult, you should try to tackle the entire process systematically.
Make money with real estate as an agent
The trick is to anticipate and identify a seller in need in advance and find a buyer who is ready to strike immediately.
In this way, you can avoid having to start looking for a motivated buyer as soon as you have concluded the sales agreement.
By identifying both the seller and the buyer beforehand, you can conclude the sales contract with confidence without fear of having to deal with the purchase and financing yourself in the end.
To be successful with this strategy, you will need to be able to find either empty properties (driving around in a car and talking to local residents can sometimes yield results), or properties whose mortgage loan is no longer being repaid.
So you go looking for vendors in need.
And if you come across vacant properties, these are often even better opportunities to make money as an intermediary!
Strike before a forced public sale (foreclosure sale)
When the owner of a house or flat falls behind on his/her mortgage payments, the mortgage lender will start to make things difficult.
First, through transparent communication, an attempt is made to find a solution to allow the repayments to continue.
In certain cases, a payment arrangement is then worked out.
This can range from lowering mortgage costs by adjusting loan terms to appointing a personal budget coach to manage incoming money such as a salary.
In many cases, a postponement of payment or a bridging loan is granted to give the owner additional financial breathing space in the short term.
With the help of holiday pay and/or a thirteenth month and/or bonuses, the owner can then catch up on his arrears.
But… Not all situations can be saved.
In the worst case, if the owner continues to default on payments, the mortgage lender may decide to proceed with a foreclosure sale of the property in question.
Make money with real estate as a vulture/animal hunter
And it is exactly during this timeframe that you, as a real estate investor, can do a golden deal.
Because in order to organise such a forced public sale, all parties involved must agree to the transaction.
This is because the property will most likely be sold for an amount less than what remains to be repaid on the current mortgage loan.
Which is not interesting for the mortgage lender.
So this can be a great opportunity for a property investor to make a quick profit without investing in a lengthy renovation.
So how to invest in real estate?
By anticipating the forced public sale and entering into negotiations with the mortgage lender in question before the property is actually sold publicly.
After all, no one stands to gain from a forced public sale:
- You as a buyer do not, because usually you have to be able to pay for these properties immediately in cash and sometimes even without being able to thoroughly inspect the property in question. Unless you are a veteran property investor, it can be risky to buy a property without an inspection.
- And the mortgage lender has nothing to gain either, as there will often be a residual debt that they will have to recover (which is very annoying).
Therefore, it is much more interesting, for all parties, for a private real estate investor to enter into negotiations with the mortgage lender before actually deciding on a forced sale.
You will then have an effective opportunity to view and inspect the property and subsequently negotiate the price.
Negotiate a win-win for all parties involved
Such negotiations with a mortgage lender may take time, but it can be well worth the wait.
The potential returns that you can achieve can be realised quickly because you can buy competitively.
You can earn thousands or tens of thousands of euros if you can make a purchase deal with the mortgage lender (a bank) because they are stuck with a bad investment.
But don’t expect to get the property for nothing – you will still have to negotiate the right price.
Depending on how keen the bank is to get rid of the property, it may be able to wait and see what happens and look for other interested buyers.
Moral of the story? Try not to aim extremely low and look for a win-win for all parties involved.
Make money with real estate for holiday rentals
Holiday rentals can be a lucrative avenue in the property market.
Not only can you earn some nice pocket money with holiday rental units.
You can even make a significant profit and more importantly: You can make it a substantial passive source of income if you are operating in a tourist area with a lot of passing tourists and visitors.
Hotspot locations in the tourism sector are known for the high demand for holiday homes that can be rented out for shorter periods of time (so-called short lets).
Make money with real estate in the tourism sector with this strategy while being aware that it can be limited to the peak tourist season, a period when the ROI is earned for the whole year…
The best of the holiday rental market? You do not even have to own the property to make money from it.
Some of the world’s most successful property management companies specialising in holiday rentals do not actually own the houses but offer a high-quality consumer experience.
How can you make money with real estate for recreational and tourist rentals?
- Network and build relationships with property owners in your area where tourists also stay.
- Build a network, forge links, create systems.
- Provide an unparalleled customer experience (the customer is king).
- Move mountains for anyone staying in one of the holiday homes you manage and (financial) success will follow.
- Relieve holiday home owners of their stress and give them more free time. You propose to them to take over all management tasks in exchange for a fee. For some of the property owners, this is a dream come true (you will have to prove that you are capable and reliable).
- If you already own a property in a tourist area, consider renting it out for shorter periods at higher prices. You can find a lot of tenants for such shorter periods online! Create an offer for your holiday accommodation on the most well-known online portals such as Airbnb, HomeAway and FlipKey.
Taking out a short-term loan from private investors
This may be an option if you do not currently qualify for a loan in the traditional financial circuit.
This means that you take out a short-term loan on which a higher than average interest rate has to be paid.
After all, flexibility and borrowing money quickly come at a price.
If you are confident and think you have found a good property deal, you can look for a solution on the private market.
This can be with wealthy families, entrepreneurs or individuals (such as a wealthy uncle or aunt).
If you have a talent for finding the right deals but do not have enough capital available, this can be a solid option.
Taking out a short-term loan on the private market can be a win-win for everyone.
The private lender can make a nice return.
And you yourself, thanks to the extra work resources, can jump on the opportunity and make a nice profit in the short term (after the loan has been repaid).
The main advantage, therefore, is that with this strategy you do not have to wait years to accumulate the capital.
The process to make money with real estate can thus be started without delay.
Commercial real estate – Make money with real estate in B2B sector
One of the bigger opportunities within the real estate sector to earn a nice sum of money is to invest in commercial property.
Developers of commercial real estate do not only focus on buying and selling such properties.
They are also involved in adding value through renovations, refurbishment works and the rearrangement of certain spaces.
This can of course have a positive influence on the value of the property after renovation and refurbishment;
But in this way, the monthly incoming cash flow can also be boosted (from three business premises to four business premises in the same building, for example).
Some experienced property investors argue that commercial property is the most lucrative source of both income and profit in the property market.
If you manage to add value to a particular commercial property, investing in commercial real estate can be one of the best sources of income you can find.
People will always need office and shop space to run their business.
These countless physical business locations are therefore the source of income for some of the giant real estate players in the commercial property market (think Coldwell Banker Richard Ellis (CBRE) and Cushman & Wakefield).
As you grow, you may find ways to open shopping centres or develop business premises on a large scale. But you have to start somewhere…
Ready-made investment property to replace the savings account – How to make money with real estate?
Why choose carefree investment property?
Are you a busy person with an abundant family life and a great job?
Do you earn a good living and enjoy quality time with family and friends, as well as the occasional well-deserved holiday?
Then you may be longing for a way to make money with real estate without taking on all those responsibilities.
Maintaining, managing and renting out property yourself cannot be underestimated. Managing revenue properties comes with obligations and responsibilities.
That is why buying and letting property without worries and ready-made investment real estate including stewardship are on the rise. Especially since the current interest rates on savings are ridiculously low.
In fact, they are so low that they are lower than the annual inflation rate.
In practice, this means that you lose purchasing power every year and become even poorer by leaving your money in a savings account.
Biggest advantages of ready-made yield properties
- No renovation stress.
- Immediate return on your investment (no months or years of delay due to a do-it-yourself project that is subject to external factors beyond your control).
- Without financial surprises afterwards (you buy on plan or already completed property and that’s the end of it) versus lengthy renovations that often leave a lot to be desired.
- No headaches, stress and frustration during the lifetime of your investment. Passive investment in real estate is absolutely possible and is even recommended for newcomers to the real estate sector
- Management, maintenance and rental are outsourced to a professional operator. Ideal if you have a very busy job, then this is the path to take!
- If you go for acquiring full ownership of an investment property, you can (partly) finance it with loan capital. This ensures that you can achieve a maximum real estate return with a limited own contribution (called the leverage effect).
- If you pick the right offers, you can count on guaranteed rental income through a rental guarantee and thus make money with real estate in a secure way.
- Investing in real estate with rental guarantee is possible through the following offers:
Offer of investment property with guaranteed rental
Brussels real estate – Value for money with appreciation potential
- Investment property for sale in Brussels in Woluwe-Saint-Lambert, nice passive yield with capital gain potential in prime location
- Buy-to-let flat in Brussels [AVAILABLE SOON] in Evere, complete passive investment including rental service and carefree package
France as a tourist hotspot
Investing in a holiday home in France has never been so interesting.
Invest in full ownership in this luxury resort by Wyndham Halcyon Retreat and enjoy three fantastic conditions:
- Up to 8% guaranteed return per year through guaranteed rental income, calculated on the purchase value of the studio, flat or luxury tree house
- Bonus return in kind: 2 weeks free private use per year of your holiday home with access to the resort’s facilities (water park, golf, spa, gourmet restaurant, indoor playground, etc.)
- Optional resale guarantees if required: Sale at minimum 125% or 150% of original purchase value after 5 or 10 years respectively
Alternatively, you can invest in co-ownership in the same resort.
This means that you can invest as little as EUR 17 230 in recreational real estate with a guaranteed return.
In terms of return, you can expect an increasing annual guaranteed return of up to 8%. In addition, you can optionally invoke the resale guarantee.
Specifically, you can sell at a minimum of 125 or 150% of the original purchase price after 5 or 10 years respectively.
Germany as a safe haven – Make money with real estate with rental guarantee
Germany is and will remain an exception in the European Union in terms of wealth creation and industry.
This country has no equal in terms of industrial progress (especially the state of North Rhine-Westphalia) and this appeals to some real estate investors.
Here you can acquire full ownership of rental flats and entire flat blocks and count on guaranteed income!
In this context, take a look at the offers real estate in Germany as a secure rental investment and buying a German flat for rent with a rental guarantee.
Buying real estate in Germany in North Rhine-Westphalia is interesting, as is the offer of German real estate as an investment with guaranteed rental income and all-in rental service.
Sweden – Family property with spacious gardens
Sweden is politically independent, a real welfare state and a country where renting is normal.
This offers opportunities for savers who are interested in buying a single house with an accompanying garden for rent.
From EUR 30 000 in equity, you can use financing to purchase such a rented property in Sweden [AVAILABLE SOON]. The return is around 7% per year (not guaranteed).
Spain (Costa del Sol)
You can invest in a flat on the Costa del Sol [AVAILABLE SOON] with guaranteed returns of 5% for the first three years.
You can use it yourself at advantageous conditions. Great location on a golf resort and close to the sea, also suitable for building up a passive income.
Interested in buying a holiday home on Samos, a Greek island?
This is possible in full ownership at the Hera Bay Luxury Resort.
Located in a fantastic bay, with an attractive combination of guaranteed rental and free use.
Do you dream of working less and earning more? Then this investment opportunity is definitely interesting for extra passive income and quality time in Samos.
Montenegro – Growth destination with many opportunities
You can currently invest in new real estate in Montenegro [AVAILABLE SOON], in a unique hillside location with a view of the Adriatic Sea.
If you opt for the mixed-use formula, you can count on a gross annual return that, according to the simulations, can climb to 9% per year.
Please note that you will not receive contractually guaranteed rental income, these are simulations and the actual yield fluctuates.
- Buying a house in the USA as an investment with secure rental income guaranteed by the promoter
- Buy property in America as an investment property [AVAILABLE SOON] with the possibility of borrowing up to 50% locally – Make money with real estate here with rental guarantee