You’ve heard it before, you get the most bang for your buck by investing in real estate. But you might not have the cash to do it.  No worries. about.com lists several strategies for investing in real estate without cash.    

As an agent at Sotheby’s Phoenix, I know first hand how you can invest hundreds or even thousands of dollars to learn about real estate investing. There are experts everywhere, including on the website. But you might not want to spend too much on courses or mentoring. Courses can only go so far in helping. Ultimately, you need to go out and do the work.

Here are some ways you can make money in real estate without the cash: 

BIRD DOGGING

Fix and flippers fall under the category of bird dogging as well as long-term investors who buy homes as rental properties. Both can be profitable. What’s best for you depends on your “goals, temperament, and risk tolerance.”

Whether it’s fix ’n flips or rental properties, many of these investors are buying several properties and most use real estate agents such as Sotheby’s Phoenix. But once in awhile, someone comes along who claims they can bring the investor a home purchase deal for 10%-40% less. Obviously, an offer like this is appealing since the less an investor pays for a home, the better return on investment (ROI) from cash flow.  A person who brings deals to the investor like this is known as a bird dog. Basically, bird dogs look for homes real estate agents aren’t listing and end up receiving a fee of thousands for this service when the deal closes. This takes no cash to get started.  

 

ASSIGNMENTS

Another way to invest in real estate without money is to use assignments. In this process, you must have your buyer lined up prior to signing the purchase contract. But it must be a cash buyer. The contract will indicate that the Buyer is "Your Name and/or Assigns.” You’ll collect your fee when you assign the contract over to the investor buyer or at the time of closing. 

 

LEASE OPTIONS

A lease option gives the option to purchase the property at the end of the lease period.  For example, whether through Sotheby’s Phoenix or by other means, you find a homeowner anxious to sell but hasn’t had any luck. You can offer to lease their home with payments equal to their house payment, etc., and add on additional fees. In return, you collect a fee for making the deal. 

 

SANDWICH LEASES

In a sandwich lease, the investor is in the middle of two lease options. Similar to a lease option, in a sandwich lease, the investor has the option to buy a property at a discount when the lease is up. The goal is to find a tenant who wants to purchase the home but can’t because of lack of money or credit problems. By leasing, it gives the tenant a chance to improve their credit and save money for the down payment. 

 

BACK-TO-BACK CLOSINGS

After the 2007 housing and mortgage debacle, back-to-back closings are almost obsolete. But there still is a way to wholesale and flip properties without using your money. At Sotheby’s Phoenix, you need to have a profitable wholesale flip deal set up. The profit also needs to be sufficient. Then you need to get transactional funding. 

If you or anyone you know is interested in Scottsdale or Phoenix Real Estate, please check out my website, www.Realestateforsaleinaz.com at Sotheby’s Phoenix and I’ll be happy to help.