The hundreds of success stories of top real estate players who motivated people to consider investing in real estate as an option. But if there’s one major thing that holds people back from investing in real estate – it is investments!
Most people believe that one needs to have huge cash or credit as investments in order to enter the world of real estate. And the fact that the industry has been ‘evergreen’ for so long, many people also think it’s quite saturated.
But is it really? There are so many myths around investing in real estate that many common people just don’t think real estate investing is their cup of tea.
This blog is going to break such myths and help you make believe that you can start investing in real estate with as minimum as $500 AND do well, and probably even do great in the long run, depending on how well and how soon you understand the rules of the game.
Let’s dive right in.
Myths you should break today about real estate investing
Number 1 – Real Estate investing needs to be done only when you’ve saved up heaps of money.
Put simply, many people believe that real estate investing requires huge money! Well, honestly, it is definitely better to have huge money to invest.
But at the same time, it is not necessary. You don’t necessarily need to have a huge amount of money to begin investing in real estate and you can start doing it with as little as $500 (and we’re going to show you just how to do that in the later part of this blog).
So, next time you read a success story of a real estate investor, don’t stop at looking at what’s on the surface alone. Dig in deep and try to understand what made that realtor successful.
You will be surprised to know that many BIG real estate investors started small. Their consistent efforts and learning curve helped them to get to this place and remember you can too!
Number 2 – Real Estate investing needs huge investment of time
This is the next big myth that’s going around. ‘Oh, I don’t want to start investing in real estate because who has got so much time?’ is something you’ll hear from people all the time.
But if you look at the reality of this, you will realize that real estate investing isn’t all very time consuming at all! In fact, real estate investing can be a great form of passive income investing and there are so many people doing this all over the States.
You don’t need to actively invest huge amounts of time in order to earn from real estate investing.
It is really simple and the best way of entering the real estate business without spending too much time actively is to consider investing in REITs (this has been talked about briefly in the later part of this blog).
Number 3 – Real Estate investing needs great knowledge and expertise
Yes, commercial real estate investing needs knowledge, experience, and expertise in order to make fortune but who has got all of these as a beginner?
Everybody has got a start and you’ve got yours too! You will learn along the way. You don’t need to know everything about everything in real estate on the day 1 of investing. That is just unrealistic. And guess what?
If you’re too busy or just plain uninterested in understanding the real estate investing deeply, you might choose to not do it at all.
You can invest in real estate without actually cracking your head about how it actually works at all by either choosing to invest in REITs or keeping your operations in real estate super simple with only a little knowledge.
So, the first step for a person who has never done real estate investing is to break these three big myths. In a nutshell:
- It does NOT take you to be filthy rich in order to start investing in real estate.
- It does NOT take you lots of time to begin investing in real estate.
- It does NOT take you to be very knowledgeable and a total expert in this field in order to begin investing in real estate.
Moving on, here are some surprising ways you can start your real estate investing with as little as $500. Read on.
1) Explore options to invest in real estate around the country
In order to begin investing in real estate especially when you have little money, to begin with, it’s a good idea to explore the options that are in the countryside.
Urban areas are definitely heavily expensive deals and these areas are very saturated with real estate moguls playing so actively in the game that it will be next to impossible for you to begin from there.
On the flip side, the deals are much cheaper in the countryside and one of the best ways to invest in the properties in the countryside is by investing with a trusted portfolio management company.
So, what do these real estate portfolio management companies do for you?
They do all the groundwork on some of the best properties in the countryside, pool in investments from many small real estate investors (people who want to invest with as little as $500 included), invest in these properties jointly on your behalf and pay you dividends or income (usually rental income) on the basis of your percentage share in the whole investment.
Finding a trusted company is very important here as it can really make or break the deal for you. Some companies keep the information of where exactly your money has been put very discrete and to you, it may all seem to be very obscure.
It’s best to stay away from such companies and instead choose a company that tells you exactly where your investments are going and give you a sort of portfolio report, even if it’s only a few hundred bucks that you have invested.
And if you want more finance, you can always look out for commercial property loans to fund your small investments.
You can begin by looking up companies like FundRise that has a good customer base, testimonials, and good returns given month on month, to its investors.
2) Buy real estate land on eBay
As weird as that may sound, it is true. With many people often selling their rare and outlandish goods on eBay, you will also find some people selling small strips of vacant land for just a couple pennies.
Now, you might argue that these lands will be so low-value and why should you even consider investing in them?
Well, to your surprise, you never know how much land can value tomorrow! While it is true that these thrifty real estate plots might not be as much worthy now, it is also true that they can be of high value and worth tomorrow.
If you play it wise and stick around with this patch of land for a little longer, you might just be in for a big surprise. Here’s an example.
Let’s say a big mall or a huge supermarket like that of Walmart decides to open a new branch in your suburb town, you will be shocked to see the value of your small strip of vacant land! So, it’s definitely a good idea to check out plots on eBay and make a purchase.
3) Investing in commercial real estate through REITs
Commercial Real Estate Investment just became easily accessible to everyone through REITs. REITs are trusts that pool the funds together from thousands of investors and invest this in a portfolio of commercial real estate investments.
Investing through REITs is probably one of the easiest ways to invest in real estate with less financing.
In fact, most beginners choose to invest in real estate through REITs in order to have exposure and gain experience in the field. Some people choose to experiment with as little as $100 and avail commercial real estate loans from private lenders to keep the game going.
4) Use commercial Bridge Loans to put that vacant space to some use
If you have a vacant space that you aren’t actively using for any purpose, you can turn that into a money making asset by making moderate repairs and maintenance to it.
You can start off really small by making small down payments of a minimum of $500 and avail commercial property loans like bridge loans that will help bridge your financial gap between having a vacant property that isn’t used for anything and a property that earns your money, who’s after-proceeds you can use to pay back your loan.
If you play the game right, you can always leverage the many benefits you get from commercial property loans and end up building a lucrative source of income for yourself with commercial real estate investments!