Property Tycoons.. Where Do They Start From With No Money!!!

Alan_M_2

This scenario isn't confined to the property world, if you look at many of the entrepreneurs who claimed to start with nothing you'll often find a great big wedge behind them from somewhere or a lucky break that was a one in a million chance.

I once started to read Warren Buffett's autobiography, after page 2 I wasn't interested - He started with nothing.....errr His family gave him $250,000 in the 50's ...not quite nothing Warren....

You'll find this throughout the business and property world, don't confuse starting from nothing or starting from scratch for start WITH nothing....sublte but important difference.

roswell

And in Alans post is your answer really, your going to need something to start it all off, you now have to find a way to find that capital, one option would be to ask people you know if they would be interested in investing in your venture for a cut of the profits.

lynzpower

I can say right NOW, that my EA has property on the market with tenants in place that gives a 12% yield.

If you could sell to rent ( the cheapest as doozergirl says, sell whatever youve got and moneysave to the death) and release any money from there its a start. Bear in mind you will have to find money to do the refurb work, and you dont want to add that to your debt, as clearly your return wont materialise until youve cleared it.

alba37

I have been involved in developing over the last couple of years, as a close friend does it.

She does a fast turn around. Cash is needed for fees, deposit & tradesmen. Materials are put on interest free credit cards or a B & Q homeplan card. (9 months interest free) She uses buy to let mortgages with no redemption penalties. She started off by borrowing enough capital to cover costs from anywhere she could, friends, relatives etc. She worked her way up to now using her own capital, but has a long way to go to make decent money! She tries to have 2 houses going at once at present.

The biggest problem now is finding projects at the right price. Because she does a quick turnaround, profit is purely on developement and not rise is house prices.

chant1l

I am sure there are a million reasons to doubt why making money in property is confined to those who were given cash/had cash etc. Yes some will have had an easier start. It will always be easier to explain why something can't be done, as Henry Ford said "if you believe you can or you believe you can't - you are right".

Many of the "stars" of the property world did start with nothing more than ingenuity, learn from them, and ignore the nay sayers.


How to get the money from nothing?
Save it, don't fritter it.
Credit cards.
Loans.
Debts.
Mortgages.
More important than any of this is the will to win and the information to do so, and I doubt any one will dole that out on a free forum, sorry.

itsakidsworld

After one year of being self-employed in the construction industry, my then accountant told me that i must invest in a pension plan and i had to be quick!( or he would lose his commission!!) After the second year he told me that in order to maintain a healthy pension plan i had to now invest FIVE TIMES what i was already investing in a pension plan! This got me thinking and i told him i would let him know. "You had better be quick" he said( or he would lose his commission!!) This was when i looked at investing in property which for a young man was scary as i had a small family and our funds were already stretched.

My own bank refused to help as they did not think my figures stacked up but i knew that if i could just get one bank or financial institution to help me then i would succeed. Eventually i was introduced to a bank manager who had vision ( the early 80's) and he agreed to help me. However, he said he would only finance 80% of two properties if i could find the deposits! Help i thought, where am i going to get this cash?

I approched my existing bank and asked for an overdraft to buy a new van and to cover finances for a big job!! ( yes a lie but a white lie in my eyes and anyway i had to pay it back at 4 over base which was around 13%!!) So i got the overdraft which equated to two deposits for the other bank and away i went. I worked my butt off to refurbish the properties and get them let out. One year on i wanted more!! The bank who gave me the mortgages said ok we will help you and you have good equity in the two houses to finance another two projects but? We need your business now, all of the construction with us! S**t i thought, they will see where the deposit came from and throw me out! With baited breath i agreed and took all my accounts to the new bank for them to study. The bank manager looked at the accounts and asked about the overdraft? I told him straight and apologised for lying in the first instance. He looked at me for what felt like ages and then said " brilliant, i love it, well done for using your brains, this bank will help you as much as you want because we can see you have vision". The rest in our families world is history, property investing became our business and we never looked back but always remember the manager who helped us with great fondness.

Sorry for a long winded story but i hope it helps anyone who thinks it is easy or anyone who thinks it is impossible! Nothing is impossible.

SteveCat

TIPPY wrote:

I HAVE READ SO MANY DIFFERENT ACCOUNTS OF PROPERTY TYCOONS SAYING THAT THEY STARTED WITH LITTLE OR NO MONEY AND ARE NOW WORTH MILLIONS!!!! DID THEY REALLY DO THIS OR IS IT ALL RUBBISH. IF THEY DID .... HOW.... AND WHERE DID THEY GET THE CAPITAL. AND.... YES I MAY BE A GULLIBLE DUNCE BUT..... MY HUSBAND AND I WANT TO BUY WRECK HOUSES AND REFURBISH THEM MYSELF THEN SELL OR RENT THEM ON. UNFORTUNATLY WE HAVE NO CAPITAL IN OUR HOME BUT WE KNOW WE COULD DO IT... AND DO IT WELL. ANY HELP OR COMMENTS APPRECIATED WHATEVER U MAY SAY!!!!:rolleyes:

Hi Tippy, this is my tale of how I started a few years ago. I was desperate to get on the property ladder re investments. My pension was crap and I was getting fed up being told I need to invest more, I didn't but chose another angle which had its hurdles, here you go:
I sat down and done a calculation regarding how much I had spent on my pention and what it was likely to cost over the next few years. The figures seemed to not add up and was taking a financial drain on me so I decided to take the property route. First off I did my research and found to start it I would need to find 15% of the value of the property, this was a major stumbling block but one I was keen to get over considerig what I had wasted with my pension. I took a gamble, I took aloan with Northern Rock and used 5k from a Credit card for the Property, I then rented it out with the rent covering the payments on the mortgage, credit card and loan. Now I just sit back and hopefully watch it grow, it did aswell and within 2 years I had remortgaged, paid back the loan and credit card and raised enough from equity to buy another. To cut the story short I now own seven propertys and all from taking a initial risk/gamble or whatever else you want to call it.
With the method I used above, I certainly wouldn't advise anyone to go into without research. The rates on the loan and credit card had to be right or affordable in other words, they were and I would have no problems doing it again. Was it a gamble? Perhaps but I now have a portfolio worth 750k and less mortgages worth to me about 500k. That to me is not a gamble, it was merely doing what I needed to do. How much would that pension be worth now after nine years?

aqueoushumour01

propertydealer wrote:

best way to start in the property game without having any money is to work as a finder for investors or developers. this way you get experience, see what is out there and for how much, pass on the leads for a price and gain valuable experience in the process, once you have done this for a few months you will have built up a good reputation within the property industry, gained valuable contacts and built up a tidy amount to start developing/investing yourself

How exactly would you get into such a job? I graduated from uni last year and property interests me although I obviously am not in a position to purchase a house. Such a career may give me an 'in' into property development.

Does anyone here work as a finder and where are the career opportunities?

Alan_M_2

lynzpower wrote:

I can say right NOW, that my EA has property on the market with tenants in place that gives a 12% yield.

If you could sell to rent ( the cheapest as doozergirl says, sell whatever youve got and moneysave to the death) and release any money from there its a start. Bear in mind you will have to find money to do the refurb work, and you dont want to add that to your debt, as clearly your return wont materialise until youve cleared it.

Is that a 12% yield on their current market value or on what they bought for - say 2 or 3 years ago?

sukey13

It is possible to use other people's money whether it be credit cards,loans or private investors cash. You can find a property investing meet up in your area by logging in to https://www.singingpig.co.uk and looking under the "meets" section.

I am not connected to that website in any way.