How to invest in property with little money.
How to invest in property with little money is something many people wish to do. Of course, in reality, it is a lot harder than it seems to do, or is it? Here are some suggestions for you to consider if you want to get onto the property ladder.
I have no money, how can I own property?
The first aspect to consider is how to find the money. Indeed, banks and other financial institutions often require collateral against any money lent. They may ask for a guarantor who will honour the repayments if you are unable to fulfill your contract. If you can find a guarantor, you are almost on the way to being on the property ladder. There are other lending alternatives; however, borrowing money from non-high street sources, comes with a high-interest clause.
You may be fortunate to have a family member or close friend who can help you out. This option needs much consideration. Family fallouts and feuds are often caused because of financial situations. Think long and hard before involving family members and friends.
How to invest in property with little money – owner finance.
Admittedly these opportunities are not as frequent as people who want to sell outright. However, some people have houses that they may consider offering owner finance. Think about it, if you have a home that is not your primary residence. Perhaps providing owner finance is a possible way to sell the house.
If you can offer high repayments to the owner, this may be enough to swing a deal your way. You may not have a large deposit available, but you may be able to afford more significant repayments. This is something that you will need to negotiate. But as they say, if you don’t ask, you don’t get!
Generate a “Flipped” Sale.
There are properties, mainly condominiums, that can be purchased pre-build. Meaning, that you pay a smaller deposit and then make monthly repayments while the project construction is carried out. Now, once the project nears completion, this is when the final payment is required. However, at this time, if you sell the property on, you can quite often make a considerable profit. As projects near completion, property value increases. It is widespread in Thailand to do what is known as “Flipping” a property.
Once you have flipped the property, you may find you have enough profit to purchase your own property. It may open up opportunities such as owner finance schemes with a bigger deposit available.
What if I have bad credit – Can I still obtain finance?
In many countries, the answer more often than not is no! However, in Thailand, credit scoring is not something that is explored too deeply. Cash is the only thing that sellers and developers are interested in seeing! So, if you fail to make your repayments, the eventuality is that you will lose the house or development you invested in! You will also, in most cases, lose any payments you have already made.
So before heading out and finding a development to invest in,
make sure you can afford the repayments. Flipping a property is a risk, especially if at the time of the final payment, you cannot find a buyer!
Have you thought about renting out your property to fund repayments?
If you can find a property that finance is available on, why not rent it out? How to invest in property with little money is possible if you can find someone willing to rent the property. Perhaps you divide the property up and rent out rooms while repaying the debt? The possibilities are out there if you look hard enough. Plenty of people want a place to rent. Work commitments, schooling and university, maybe short term, in which case finding accommodation is essential.
If successful, this may be a way to pay the finance and build up some capital. Especially if you do not need to live at the property yourself.
So to summarise – How to invest in property with little money.
Think outside the box. Channel your thoughts into ways to overcome significant capital investments. Speak to owners and developers and see what opportunities are available. If you look hard enough and ask enough times, eventually you may get the answer you have been looking to find!
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