Making Money in Real Estate Business without much Investments

Making Money in Real Estate Business without much Investments You may have seen advertisements in internet and other print medias, some people promising you to make profits from real estate business without spending or investing a single penny. They normally promise you in lakhs in real estate profits without any investments. But the real trust is that many of these frauds never made a penny in real estate business, but instead build their future though selling over priced or worthless/useless information to innocent people. First of all we must understand that, it is not easy to make money in the straight forward real estate business and also the real estate “broking system” is not foolproof enough to protect your interests. However, that doesn’t mean that you need have lot of money or surplus of cash to get started in real estate business. The following are few real estate business strategies for those people who wish to start real estate business and generate income on a regular basis. 1) Work as property Broker/Dealer You don’t have to won a property to make money from this, the best way is you can work as real estate broker. There are two types of real estate brokers – retailers and dealers. Retailers buy properties outright and sell them for a quick profit. Their risk is highest, but so is their potential reward and the same time retail brokers retailers typically need large amount of cash for a down payment or capable of arranging loans as required. In short property Dealer brokers, by contrast, buy and sell contracts, not the real properties. They find bargain properties and sign property sell agreements with the owners of the properties. Dealers then sell these agreements or contracts to retailers, making a solid profit through these transactions without investing much. This process is known as “assignment of contract. Usually, the only cash required by the dealer broker is the advance money to be paid to the owner of the property for secures the deal. A good Broker Dealer can then make a contract for an investment of Rs. 50,000 to Rs. 100, 00.00 without ever taking possession of the property. 2) Use Third Party Double Closing for more profit in real estate business A double closing allows a dealer to earn a higher profit margin than an assignment of contract. With an assignment of contract, there is always potential that the deal will ultimately fall through. The dealer is protected in this case because he has already received his proceeds from the sale of the contract, but the retailer who buys the contract from him is cautious of the deal falling through, and thus, will factor it into the price he is willing to pay. With a double closing, the dealer assumes more risk, because if the deal falls through, he receives nothing. However, with this greater risk comes a greater reward. A double closing begins with the dealer signing a property sell agreement with the property owner. Then the dealer signs an agreement with the retailer, in which the retailer agrees to buy the property from the dealer at a higher price, and deposits that amount in some designated bank account. The property owner signs the deed to the dealer, who then signs it to the retailer. The retailer then signs the loan documents, and the process is complete – the property owner is paid his asking price, and the dealer is paid the difference. Note that the dealer came to the table with no money, and his credit was never an issue. 3) Property Information Providers In addition to dealers and retailers another category of commission agents are information providers, they just pass the information to the potential property buyers and earn profit out of it. These types of agents face even less risk than dealers, and have almost no cash or credit concerns. They simply gather information about distressed properties and sell it to interested dealers and retailers. In effect, they do the dirty work for real estate investors, and investors are willing to pay them handsomely for doing it. Typically these agents will gather the property owners name, their contact details, expected price, details about any pledge /mortgage, outstanding liability on the property, pictures of the property, exact property location also he will collect details of owners motivation to sell the property like money urgently required for daughter’s marriage, paying off bank loans, just selling for making profit, job transfer etc. The property investors typically pay these types of agents between Rs. 5,000.00 to Rs. 10,000.00 or depending up on the value of the property for good and reliable information. 4) Take Over the Property Owners Loan Payments Another form of property deal is taken over the property owner’s loan payment. If the property owner is unable to pay his loan amount due to financial difficulties, some people will help them to pay the loan amount to the financial institutions and subsequently take ownership of the property. Real Estate Success Always Requires an Investment There are ways to profit from real estate without significant financial investment, however, that is not to say that success comes free and easy. At the very least, you will need to make a substantial investment in yourself. In order to succeed, you must be willing to work hard. Be sure to invest in your education on a daily basis, and learn as much as possible about your local market, real estate law, and investment strategies etc.

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