Real Estate Elevated: 4 Ways to Invest in Real Estate with Only $5,000

One of the main challenges that scares people away from real estate investing is the money. Many people seem to get caught up in thinking that they must have thousands of dollars in order to start investing in real estate, and often they stray away from house flipping because it's "too expensive". But in reality you can start with only $5,000 to your name. When Tarek and I started flipping we didn’t have a lot of money, but we figured out how to make do with what we did have. Through a lot of hard work, we were able to transform our small amount of money into a successful real estate investing business.

You don’t have to be a millionaire to get started with investing, you only need to follow a couple of simple investment strategies. Quit dreaming and start doing by trying out these options to help you start down the real estate investing path.

Wholesaling

Wholesaling is often known as the easiest way to get into real estate investing as you don’t need a lot of money or experience to get started. With wholesaling, you’ll be the middleman in real estate investments as you’ll find potential properties for people to flip. If you are willing to put in the time and effort, wholesaling can prove to be a great source of income. This is a great way to get your real estate investing business off the ground. Wholesaling is similar to flipping, but you’ll turn a profit from your work much more quickly as you don’t have to worry about spending time remodeling homes. I certainly recommend this route if you don’t have a lot of money, but want to give real estate investing a try.

Lease Option

A lease option allows you to rent a home, and once your lease term ends you are given the option to buy the house. During this time, no one else will have the option to purchase the house. The downside to the lease option is that if you don’t buy, any “option money” (which gives you the choice to buy the home later) put down is lost. This is a great choice if you don’t have good enough credit to take out a mortgage, but you are able to find tenants who are interested in occupying the home.

Crowdfunding

Crowdfunding has become a popular option to fund businesses and other ventures, as well as real estate. Through real estate crowdfunding, money to fund house flipping is much more accessible as you don’t have to have connections with people to help fund your business. Crowdfunding allows people to contribute smaller amounts of money, instead of a large chunk, so it’s a good option if you don’t have many connections with people who have a lot of money.

Joint Venture

Consider pooling your resources with other investors. If you partner with someone else (or multiple people), you’ll have access to more opportunities that you wouldn’t otherwise have on your own. A joint venture usually includes two or more people and a loan. Each partner would provide a chunk of money to put down on the loan, and then after flipping the house any profit earned is divided up evenly depending on the amount that each individual originally put down.

Real estate investing is possible, even if you have less than $5,000. Follow these strategies and push your fears aside, because real estate investing is more in reach than you think! 

For more information about real estate investing, visit Real Estate Elevated's BiggerPockets blog.