How to Start a Real Estate Business with NO Money
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Is it necessary to have money upfront to start a real estate business? Find out how you can start a successful real estate business, making passive income, with NO money upfront!
Lots of people are looking at opportunities to start a business, building wealth, and establishing a passive income. One of the areas that people tend to see a lot of success is in real estate – it’s a tried and true method that people have been using for a while. But unfortunately, the majority of us don’t have the 10s of thousands of dollars needed for a downpayment to start investing in real estate.
We’re going to look at a few different strategies and models to start building a real estate business without any money upfront. You’re going to need to be creative and resourceful to be successful, and these qualities are going to help you to be successful long term in business.
The first way you could get started is to find someone else with money to partner with in order to start your business. This can be great if you’re interested in forming a partnership, but it also means you’re going to be giving away some of your equity to the other person.
Another way is property management. This way, you can control and leverage real estate without actually owning it and putting down the initial investment. This tends to be a great method because you’re able to enjoy the benefits of being in real estate, the stability of it, while also removing the risk of owning a property with a large upfront investment, and losing it due to market changes.
Traditional long term rental property management is the most stable business you can get into within real estate. Every month, it’s very predictable to know how much revenue you’re going to be generating. With short term rental property management, the income is less stable month-over-month, because of there being a high season and a low season, but in general, it is still predictable. You’ll know, for example, when the high season is and when the low season is, because every year you can expect bookings to go up every winter or every summer, depending on your location. So even though it isn’t stable every month making the same amount of money, you can still know approximately how much revenue you’ll be bringing in monthly based on your portfolio.
Using this model, you’re going to be earning between 10% and 30% management fees, depending on how involved you are and what your responsibilities are with the property. You can do it remotely and just take care of the online aspects of the property and do this no matter where you are in the world, and take around 10-15% fees. If you can take care of all the on the ground operations for some properties in your local area, you’re organizing cleanings and maintenance, then you can charge between 20-30% in fees.
Either way, there are lots of systems in place to automate the day to day operations of the business and make them simpler for you, having the business running relatively passively. In the link, there’s a free training that explains step-by-step how to get your first property, set it up, and automate it. With the same property, it’s night and day the difference between how much you can make on it through long term rental versus short term rental. Long-term rental management can only take between 5-10% fees, so less than half what you could be making with short-term rentals.
Yes, there is more work, but by automating your systems you can reduce your time and effort on the actual management side of things. With this method, you don’t have to worry about paying back borrowed money or losing your startup capital. If you’re interested in learning more about this method, check out the links to the free training!
What's up guys, my name is James and in today's video, I'm going to talk to you about how to get started in real estate building a real estate business without any money upfront. So if you're watching this video, I know a lot of people have a desire to start their own business. And a lot of you will want to get into real estate, because obviously real estate is a very tried and true method for creating wealth and building passive income.
But a lot of us don't have a ton of money to get started with certainly not the 10s of thousands of dollars that it typically takes to get started with a down payment on a traditional investment property. And so in today's video, I want to break down a few of the different models that you can use a few different strategies you can implement in order to get started building a real estate business without any money up front.
Now, at the end of the day, whenever you want to do something that typically requires money, if you want to do it without money, generally, it just comes down to being a little bit resourceful about it, you just have to get creative in your approach to how you get started, if you can't just throw money at it. Now, I actually would say that this is the best way to get started if you're new to business, or you're new to real estate, or really, if you're new to just about anything is to get started without any money and have to take that resourceful route.
Because oftentimes that leads to be building a business that is a lot more secure. You start out having to be scrappy, and you have to be resourceful, it's a really good skill to build that's going to allow you to be successful long term in business. And so you'll find that oftentimes, some of the businesses that are the most successful long term end up being the ones that started out without a ton of upfront investment. Having up front investment can make you really sloppy, you can have the wrong decisions being made. At the end of the day, you're not really being all that resourceful more often than not.
So let's dive into and let's talk about how you can actually do this and how you can get started without investing any money and start building your real estate business. Now before I dive in, I would like to ask you a couple of things. Number one, if you're new to the channel here, please just subscribe to the channel if you want more content like this. Number two is if you could take a quick second and just press that like button, just a little like button in the bottom right hand corner there, just take a second and click that like button, it helped him tremendously with YouTube's algorithm. Number three is if you want to learn more about anything that I cover, in this video, I've got links down the description below that just want to let you know about those are gonna be really helpful for you to some more in depth training if you really want to go down this route.
So there's a couple different ways to get started when it comes to getting into real estate and starting real estate business without any additional income without any additional set aside capital to get started investing into the business. Now the obvious way number one is to find someone else with money who you can leverage as an as a money partner to get started investing into real estate or get started working on building a real estate business.
Now, this can be a really great route to go if you want to partner with someone. But the downside of that is that you're going to be giving away some equity in your deal or in your business in order to partner with that person. Because obviously, you're going to be the working partner, that's going to be the brains behind the operation and the labor behind the operation. But they're going to be providing the money. And so there has to be some kind of split up of the actual equity in the business there. Now another way to get started is to find some creative way to get started without actually needing to invest into real estate to be able to control it, there's a couple different ways to do this, the most common of which is property management.
That way you can actually leverage real estate without actually having to own it. And so it's a really great method because you It allows you the same potential upside, or a lot of the same potential upside of being in real estate and the same stability that comes along with real estate, without meaning the capital upfront investment, and without having the risk that comes along with owning a property yourself. Now traditional long term rental property management is probably the most stable business that you can get into in the real estate space.
Because you know, month after month after month, with a really high level of predictability, how much money you're going to be bringing in. Because everyone that you have that's generating you money is paying a consistent monthly amount of rent, sure, they might default on their rent some months and other months, might bring on more clients and have a better month. So your income can fluctuate a little bit. But for the most part, it's going to remain relatively stable. Now, if you look at short term rental property management, in contrast to that, you're not going to have quite as much stability, but you are going to have the same degree of predictability to your business income.
What I mean by this is that seasonally your business is going to change right there's likely going to be a high season and a low season and whatever market you're in, there's going to be times when there are more people coming and visiting your city and therefore properties are doing better in let's say the summer months. Or it could be the winter months. If you're somewhere down in like a market like Florida where a lot of people Snowbird, down there and vacation down there during the winter, you're going to have those different fluctuations in the markets demand and the amount of income that you're earning. Now, even though you've had that fluctuation doesn't mean that you don't have predictability in your income.
The really nice thing about being in a business like this is that you can actually predict exactly what those seasonal fluctuate returns are going to be because well, they happen every single season. So you can pretty easily tell exactly how much money you're going to make each month based on the properties that you have in your portfolio. The other great thing here is that by doing this, you have a tremendous amount of upside, without any of the downside, you don't have to invest into the properties yourself or pay any money for them, you just get to control them and take a cut off the top.
Now, generally speaking, using this model, you're going to be earning somewhere between 10 and 30%. management fees, depending on how involved you are with the property. If you're managing completely remotely and just taking care of the online aspects of managing the property, then the really big advantage of that is you can do it anywhere in the world. And you can scale it to all different areas. But at the end of the day, you're only going to be earning maybe about 10 to 15% in management fees.
Whereas if you're taking care of more of the on the ground operations, you're focusing in one local area and doing things like organizing the cleanings, organizing, and scheduling, any maintenance that's needed the property, all those things are going to be more valuable to the property owner. And so you're generally going to be charging closer between 20 and 30% for your management fees. Now, the nice thing about either model is that you can systemize all the day to day operations of the business. So you can remove yourself from all of those aspects.
And you can have the business running relatively passively within a few months of getting started actually building those systems and setting them up. Now, if you are interested in learning more about how to get started using that method, I've included a link in the description down below, that walks through step by step free training that I put together for you that will help you to learn the ropes of exactly how to go about getting your first property under management, how to set that property up, and then how to automate and outsource the day to day operations of the business. Now, this, in my opinion, is the best way to get started building your real estate business without any additional income without any any upfront investment into the business for a couple of main reasons.
Number one, it's got a lot higher upside potential than most other methods. Now, if you look at something like traditional property management, you compare the two it's night and day how much more money you can earn on short term rental versus long term rental for the same exact property. So you can earn a lot more income on every single property, and you're getting a higher cut. Long term property managers because of the low touch nature of the business are generally only earning between five and 10% men fees, which is exceptionally low, when you compare that to anywhere from 10 to 30%.
For short term rental management, to making a lot more money for each property. Granted, there is more work going into it. However, like I mentioned, you can with the right systems automate and outsource all those day to day operations. So you end up making a lot more money per property. That makes it a lot easier to scale. And the really great thing about this is you're also not giving any equity away in your business, you don't have to give a cut of your business to anyone else. And you don't actually have to take the risk on of having additional capital in there to begin with. Even if the money isn't yours.
At the end of the day, if you're borrowing money from someone else to get started in your real estate business, you still owe that money back to them. So it is a risk that you're taking on when you start your business. Being able to get started without taking on any of that risk with your own money or anyone else's in my books is a really big plus. So those are just a few of the many reasons that I think this is a really great method. And I personally it's the method that I chose when I was first getting started building my real estate business. And getting started without any experience not having tech skills, not really having a background in the space and certainly not having a bunch of money to pour into it.
This is the method that I chose for exactly those reasons. So again, if this is something that you're interested in, and you want to get started building real estate business, you want to be able to have the freedom to travel and do things you want to do and kind of live life on your own terms on your own schedule, then recommend checking out the link down below to the free training that I put together for you. That's going to walk you through the step by steps of how exactly to do it.
I hope this has been a really valuable video for you. If you liked it, then go ahead and just click that like button, give it a thumbs up. I really appreciate that it does a lot to help me with this channel. And as always explore all the resources that are here for you on this channel. I've got a playlist as well on this YouTube channel that walks you through the six crucial steps for building an Airbnb management business, a short term rental management business. So if you're interested, you can check that out as well. If you want to get up to date with all of our weekly videos, we post two new videos every single week. Have you subscribed to the channel and you'll be notified when the new videos go live. Other than that, that's all I've got for you today. So I will see you in the next video.