How To Get Into Property Development With No Money

One of the reasons that the property market is so popular for investors, is that it is accessible. Everybody has to deal with property at some stage of their lives and it is easy to pick up the vital skills that you need.

By Jon Howe4/28/21

How To Get Into Property Development With No Money

One of the reasons that the property market is so popular for investors, is that it is accessible. Everybody has to deal with property at some stage of their lives and it is easy to pick up the vital skills that you need. However, you will always need capital to outlay if you want to purchase property to develop.

This shouldn’t be a hindrance to your ambitions though, however peculiar that might sound. You can’t invest in property with no money, but you can become a property developer with no money. The key is how you obtain the cash to allow you to realise your ambitions, or how creative you are in getting into the industry.

This can be very frustrating to the budding property developer, because you may have the skills and the knowledge, but no available cash. However, there is always an answer somewhere, and in this case there are several.

Unfortunately the days of 100% mortgages are long gone and you are likely to need a deposit on your first property, unless you are fortunate to see a bargain property that has been discounted way below its value and you and a mortgage-lender can see some potential in it.

They may lend heavily against that projected value, but it’s a gamble to take that route. This kind of heavy refurbishment is one way to become a property developer with no money, but it is fraught with risk, so here we have outlined a number of considered ways in which you can raise capital to get into property investment, some of which allow you to sharpen your property development skills at the same time.

Essentially, there are four strategies you can use in order to get into property development with no cash, and within those categories there are different routes you can take.

Traditional forms of raising money

Saving money for a deposit

Aggressive saving can be a long-winded and unexciting way to raise money, but it is dependable, risk-free and completely within your control. It is also achievable. There are many ways in which you can track your spending and become disciplined in saving money each month to put away in a safe place.

You can even find a way to earn interest off these savings if you are imaginative. Everybody can cut out certain luxuries if they really try and you can also explore the possibility of earning more income in order to save more.

People trying to save money for a deposit often set up a direct debit to syphon off a fixed portion of their monthly income, and then attempt to live off the rest. This requires commitment and can be something of a slow burner when the enticing prospect of property development is waiting for you, but if you are serious and have no other practical options, this is a time-honoured and credible way to build-up funds for future investment.

Borrowing money for a deposit

Depending on which lending vehicle you choose, this can be a really bad idea. Debt can be very restrictive and damaging, and there aren’t many options open to you in terms of borrowing money when you want to invest it in property and haven’t got a deposit. Using money from credit card debt is a recipe for disaster and taking out a traditional loan and not being honest about its eventual use is not advisable either.

Borrowing money from a family member could, however, be a lucrative avenue, albeit this is a route that few are fortunate enough to enjoy. This touches a little on the area of joint ventures, which we will explore later in this article, but partnering with a friend or family member who lends you the cash can mean you enjoy pretty flexible and favourable terms that aren’t available anywhere in the traditional financial markets.

However, this can still carry some risks as money and relationships are often unhappy bedfellows, and you need to be careful to get everything agreed on a formal basis. But nevertheless, this can be a quick, easy and accessible route in to property development when you have no money.

Raising money by making the most of what you have


Being property savvy and wanting to get into property development, can often mean that you have no available cash but lots of equity in your property. You have earned this equity through some good, considered decisions over your lifetime so far, so now you can take advantage of it to get you on the road to being a property developer.

People can get a bit twitchy about re-mortgaging a property, or extending a mortgage on a property, but in terms of getting into property development when you have no cash, it can be done quickly and easily. Of course it depends on your personal circumstances as to whether this route is financially advisable, so you should get professional guidance on that. Also, while some mortgage providers are happy to offer re-mortgages as they are a relatively safe form of lending for them, given the security you are offering up, some are not, so you need to research this carefully.

You should also be wary that any property you buy via a re-mortgage on an existing property is going to be funded entirely through debt. This is a risky position to be in, so you need to manage your cashflow carefully and also manage the development project to ensure it goes as closely to plan as possible, otherwise you can be left with a considerable burden of debt. With experience, this form of finance will become easier for a property developer, as you can use your portfolio of properties as security against your next purchase, but when starting property development with no money, you will have to use your own home.

Renting rooms in your home

It may seem inconvenient or an intrusion to rent rooms or space in your own home to strangers, but it can be a short term thing and it is a low-risk route to easy money. If you live in a big city or on a traditional commuter route, you could try to rent your space on a Monday-to-Friday basis, so that at least you have your privacy back at weekends.

Also, if you have the time and inclination, you can explore the Airbnb route. This involves a bit more work but can evolve into a tidy little business and is a form of property development in itself. This can quite quickly lead to a healthy deposit being saved and a route into purchasing a property, and you could still maintain this as a secondary form of income to help with cashflow, as you get your property development business off the ground. It is literally money for nothing and could become a vital source of accessible cash.

Starting a property business

Joint venture

This is a step up from simply borrowing money from a friend or relative and is the formation of a formal business, where your investor is a sleeping partner and you utilise your skills and knowledge of the property market to do all the work. This is a popular form of getting into property development if you don’t have the cash, but know someone who does. There is no financial risk to you, but you do have to be very careful who you choose to partner with.

It is not uncommon to partner with an investor who you don’t previously know. This can be researched via thorough background checks, but a professional investor can be viewed much as a friend or relative, as long as the partnership is formalised and there is a valid, written structure to confirm who has invested what, who has what responsibility, who owns what and how rewards are shared out. This can be a lucrative way of entering property development with no financial outlay of your own.

As mentioned earlier, money and relationships are not a good mix sometimes, so the legal structure is critical, but when interest rates are so low and pension performance is making saving money for retirement very difficult, property investment is becoming very popular. So your property knowledge can be a valuable asset to someone with money they are willing and able to invest.

Property deals

So you have got the time and the knowledge of the property market, but you don’t have the cash. You are able to find good deals and have an eye for properties with potential, but you need someone with money to buy them. If this isn’t going to be you, then the next best thing is for you to at least manage these property deals and take your cut of the rewards.

This is often called ‘deal packaging’ and effectively means you are finding discounted properties on behalf of an investor, who then pays you a fee for your work. This can go one stage further and involve you managing the process of purchasing the property, ie. processing the mortgage, monitoring the legal work and even managing any refurbishments. This will earn you a bigger fee and means you are honing all your property developer skills and building up contacts at no financial risk to yourself, whilst earning typically between £5,000 to £10,000 on each property to put towards a deposit of your own.

Get creative to make money to invest in property

Rent to rent

This is a practice that is growing in popularity, whereby you partner with a landlord to manage and rent out their property. This typically involves a multi-let property or a house of multiple occupation, and in this scenario you would pay a single rent amount to the landlord for the property and then make money from the mark-up of renting out individual rooms to tenants.

You are effectively acting as a letting agent for the landlord and hence can charge a fee if you are managing the property in terms of finding tenants, arranging contracts, looking after maintenance and refurbishment.

Many landlords prefer to be a property owner but play no active role in running a tenanted property, so this practice suits everybody, and particularly you, because you are involved in property development but you require no deposit and no mortgage and are building a nice little income. There is no financial risk for you, although this will involve a lot of time, but again, you are using skills and building market knowledge that will be useful for you when you get further involved in property development down the line.

Property crowdfunding

Another 21st century innovation is the concept of finding investment through a crowdfunding platform. This still requires you to build a credible property proposal and perhaps more so, because you have to convince people you have never met to believe in your project and invest in you.

Peer-to-peer lending (also known as P2P lending) is the most popular crowdfunding vehicle for property developers, as people group together to invest in you and you repay them when the property is refurbished and sold. You may only need this kind of investment when you are working on your first property, because after that, each property should ideally finance the next one, but crowdfunding is a great way to get into property development without putting the money upfront yourself.

If you are making very tentative steps into property development and you haven’t got big finance behind you, you can also do it by being one of the crowd. You can use a crowdfunding platform such as UOWN to invest whatever you can afford from your monthly income into a share of a property. This enables you to earn a share of the rental income and any profits from the sale of the property. This small investor side of property crowdfunding is a good introduction into property development, whist you learn some skills and build some savings with which to take your ambitions further.

Lots of ways to make money

As you can see, there are lots of ways you can make money from no money. Some of these enable you to build up the cash for a deposit, whilst others offer an indirect path into property development, through which you can earn whilst you learn. This selection of money-making methods should offer something to suit everyone and it really is down to your personal circumstances, your ambitions and your eagerness to make inroads into property development, which path you go down.

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