There are several different ways to invest in real estate, some of them traditional and some of them outside the box; however, it is important to always pick the most socially responsible investments. You may have heard of guru’s who claim to be able to have solutions for no money down, no credit, no documentation, or no whatever. But can you really invest in real estate in those types of ways?
The answer is yes, you can. It seems a little shady at first, but if you really dig into it, it is just thinking outside the box and good business practices. Here are some examples of those different types of creative investing and ways in which you can make money. Before you start investing in real estate for your future, make sure you get professional assistance from an estate planning attorney.
Bird Dogging—Sounds kind of funny and I’m sure the term actually originated in the South somewhere. In this practice, you work with a real estate investor and you do all the searching for specific property criteria. Maybe you’re driving through neighborhoods on trash day and notice houses that don’t have trash cans in front and notice that the property is vacant. You would then write down any pertinent information and sell your leads to an investor for a small fee.
Or your investor will pay you if they close on the property. Either way, it is low risk for you as you’re not going to be under contract or anything of that nature. You can make decent money bird dogging for someone, but not the great money you’ll make with other methods.
Wholesaling—A popular starting place for real estate investors, this involves no money out of your own pocket, no income, and no credit. However, you should probably have some deal making skills, negotiating skills, and some good business savvy. In this method, you find properties that are undervalued, make low offers on the property and attempt to get the property under contract.
Good targets for purchasing under value are probate homes, non-owner occupied homes where investors don’t want the hassle of being a landlord anymore, and vacant properties where an owner just doesn’t want to deal with the house anymore for whatever reason. Once a property is under contract, the wholesaler will assign his interest in the contract to an end buyer.
The end buyer is usually a cash investor who has the ability to close on the property with their own funds. The end buyer will usually make room to charge you a fee for doing what you do. The fees range from $1,000 to $10,000+ depending on the margin you set up with your buyers. If you could put together a few of these deals in a month, you could easily make a full time income with little risk.
Alright, that’s enough for today. In the next segment of Creative Real Estate Investing, I’ll give you another strategy for investing creatively when you don’t have money, or credit, or anything. Also, don’t forget to read this review of rental management merced ca, you’ll learn very valuable information!!