Investment StrategiesHow to Invest 1000 Dollars in Real Estate by Charles Mburugu August 14, 2020August 13, 2020 by Charles Mburugu August 14, 2020August 13, 2020One of the most common myths is that you need to have thousands of dollars to get into real estate investing. While it is true that buying investment property can be very costly, there are other ways of investing in real estate without spending a lot. In fact, you can start investing in real estate with $1000 or less. You can even buy real estate with no money…literally.Wondering how to invest 1000 dollars in real estate? Here are some real estate investment strategies to consider:Real Estate Investment Trusts (REITs)So, how can beginners invest in real estate with little money? By investing in REITs, which works a lot like investing in mutual funds or stocks. A REIT is basically a company that pools together money from different investors and uses it to buy various investment properties. This could be office buildings, multi family homes, warehouses, hotels, industrial property, or retail space. As a shareholder, you will be paid a dividend when the properties generate a return on investment. Investing in REITs is hands-off, safe, and offers potentially high returns.When assessing REITs, look for a company that has been in existence for a while and that has a great management team. In addition, the company should also have a good track record of offering high dividend yields.Related: What Is a Real Estate Investment Trust (REIT)?Real Estate Crowdfunding Real estate crowdfunding is another way to make money with 1000 dollars. Just like REITs, crowdfunding involves a group of real estate investors pooling their cash together in order to achieve a common objective. This investing option falls under the JOBS (Jumpstart Our Business Startups) act that allows companies to raise cash through crowdfunding.Crowdfunding investments involve three main players:The sponsor – This is the company or individual that identifies and manages the real estate property. The sponsor will handle the purchase of the investment property for sale, arrange the financing, find contractors and other workers, and take charge of the property sale down the line. Real estate deal sponsors usually chip in for the project’s funding and take a share from the profits generated.Crowdfunding platform – This is where the sponsor connects with investors that will help raise capital for the project. Some of the most popular platforms for real estate crowdfunding are PeerStreet, Fundrise, CrowdStreet, and Realty Mogul. The platforms will vet the real estate deal, advertise it to potential investors, and ensure that investors meet minimum requirements. The platform will also collect the money on behalf of the investor.The real estate investor – The investor (you) contributes some of the capital required for the deal and receives a share of the profits generated. Let’s say the sponsor finds an apartment building for sale at a price of $3 million. If the sponsor can only invest $1 million in the project, they could choose to raise the remaining amount on a crowdfunding platform through real estate investors like you.Related: The Best Real Estate Crowdfunding SitesReal Estate PartnershipsA partnership is another great strategy to consider when thinking of how to invest 1000 dollars in real estate. Combining forces with other like-minded people allows you to achieve what you wouldn’t have been able to working alone. A real estate partnership falls into 2 main categories:Active partnership – This is where all partners are actively involved in the daily operations of the business. For instance, one partner could be in charge of property management, while another handles marketing.Passive partnership – In this arrangement, one partner provides the capital while the other does all the work.You can form a real estate partnership with family, friends, members of an investment club, or angel investors. Be sure to do your due diligence on the credibility, experience, and track record of potential partners before getting into an agreement. It would also be wise to involve a neutral party such as a financial advisor or attorney who can provide guidance in case of a dispute.No matter the kind of partnership you settle for, there must be a written real estate partnership agreement. This document should answer the following questions:How will specific roles be divided?Who will be responsible for day-to-day decision making?What is the procedure for the resolution of disputes?What happens if a partner becomes debilitated, dies, or decides to leave the partnership?How will the profits be distributed among the partners?How much money will be kept in reserve for unforeseen expenses?Related: How to Form Real Estate Property PartnershipsReal Estate Wholesaling Wholesaling is one of the best ways to invest in real estate with no money. Investors find an income property selling below market value, acquire it under contract, and then sell it to a willing buyer at a higher price. Since you don’t have to actually buy the income property, wholesaling can be a great way to break into real estate investing. You will make money in less time and get to learn a lot about the real estate market. The downside of wholesaling is that income is guaranteed and finding buyers can be very difficult.Here are the steps for successful real estate wholesaling:Do your homework – Get familiar with how the process of wholesaling real estate works. You can educate yourself by reading real estate blogs, taking online courses, attending webinars, or talking to mentors. Doing your homework should also involve researching the best neighborhoods for finding investment properties.Find real estate deals – Once you are ready, you can find wholesaling deals on Craigslist or real estate sites like Mashvisor. You could also search local public records or simply drive around the neighborhood to find leads. Use Mashvisor’s tools to analyze properties using metrics such as cap rate, rental income, cash on cash return, and Airbnb occupancy rate before putting in an offer.Negotiate price – Identify a suitable property and negotiate a favorable price with the seller.Find a buyer – You can find cash buyers through networking with real estate agents, landlords, local real estate investors, or members of a local investing club. Alternatively, you could use Craigslist, lead capture forms, courthouse auctions, or hard money lenders to find buyers.Learn more by watching Mashvisor’s video on wholesaling real estate:Find an investment property to wholesale using Mashvisor.Conclusion Anyone can learn how to invest 1000 dollars in real estate. Look at the strategies listed above and decide the best way to invest 1000 dollars. If you require more capital, you can raise it through a conventional mortgage, FHA or VA loan programs, commercial financing, private loans, seller financing, or hard money financing. Start Your Investment Property Search! START FREE TRIAL CrowdfundingPartnershipsREITsWholesaling 1FacebookTwitterGoogle +PinterestLinkedin Charles MburuguCharles Mburugu is a HubSpot-certified content writer/marketer for B2B, B2C and SaaS companies. He loves writing on topics that help real estate investors and agents make better choices. Previous Post How to Grow Your Real Estate Business Next Post Is Buying a Vacation Rental Property Profitable? Related Posts The BRRRR Model: Pros, Cons & What Rental Investors Should Know Airbnb Rental Income vs. Airbnb Occupancy Rate: Which One Should Lead Your Investment Decision? Why, How, and Where to Invest in Positive Cash Flow Properties in 2018 Real Estate Investing 101: Long-Term vs. Short-Term Rentals Airbnb Rentals for Weddings: Should You Invest in Them? 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