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How to Start Property Development With Little Capital

Updated on April 16, 2020
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I am an Information Digital Service Solutions Provider, A Trained Systems Analyst and Administrator. @Stayjid on Twitter.

There are many ways of making money, but over recent years one stands alone as being a virtually proven way to make money, with security built in at the same time. Few businesses are as secure, nor offer a chance to make profits for a single, simple deal.

Property dealing is no small time opportunity, and it's far from risk free, but the potential rewards make it well worth considering. It is the one method where people have become ver rich very quickly.

Property investment used to be the preserve of the very rich, but over the years property
ownership has become more widespread and much simpler.

Though property prices have risen sharply over the last couple of years, it does not mean that profits cannot be made. Simply that a greater investment is required - offering, of course, subsequently higher profits.


In the past, to succeed, you needed thousands of ready cash. A loan may not just do,
and in fact, it was rarely available to newcomers. Nowadays however this is no longer essential, A very meagre capital sum - can mean success. And just one project can generate all you need for future developments.

Before starting, see how much money of your own you can raise. See if you can borrow
from friends and relatives, perhaps for a share of any profits. If you can get a few hundred to start with, then that is a very good start.

Next, check out the potential for raising capital. Financial institutions are keen to lend you money, but it is as well to take professional and independent advice on this. You could raise a mortgage on any existing property.

A final way to get finance is to get people to come in with you as a syndicate. Place 'Capital Wanted' advertisements in newspapers, or reply to the 'Capital Available' ones. The basic idea is that you invest your time while others invest money, but that the proceeds are divided equally at the end. It can still work - get a solicitor to advise and set up the syndicate though.


Property investment must be dealt with in a very careful way, so you will certainly need expert professional advisers to help you. If you are trading with other people, a limited company may be a good idea. Take the advice of a solicitor on this in any case.

Banks are a useful contact for advice on finances and handling money. You May also need an accountant. Insurance brokers can identify all the different types of cover you might need.

Architects and surveyors can help with assessing and valuing property and drawing up plans for the work you will do. Some can even arrange and supervise all the work too.

The statutory planning and building authorities - at the local town hall - are not only a source of information on regulations, but can provide much general advice too.

All in all, remember that although property can be exceedingly profitable, there is an element of risk involved. You must take professional advice from all of these advisers. Otherwise it is quite possible that you could lose money. Once ready to go ahead, there are several types of project you could consider.


This area offers some of the biggest profits. Basically, you just buy run down property, restore it and quickly resell. Opportunities are available for those without capital to form a syndicate.

Look for suitable property locally. Ask to buy it rather than waiting for 'For Sale' boards. Of course, a lot of old cottages etc. have been done up already, but property deteriorates all the time, so there are continuous opportunities.

Once located, a surveyor can advise on renovation costs of property in a poor condition, and hence suggest if a profit might be possible. Set a budget for the renovations and, as long as you stick to it, a property profit is virtually assured. Of course, the fluctuation of prices can be a problem, but also an advantage.


Those with a keen eye can make money by simply buying property which they consider to be undervalued. Perhaps someone needs to sell desperately to move. Then re-selling when prices are higher. Watch the movement of the market and take advice from an estate agent - you might pay one a retainer.


Further careful studying of the property market and the auction scene offers a chance to buy auctioned property at 20% plus off the normal market price. Rarer than in the past, but still possible.


For those interested in a major project, then building a property offers enormous potential for profit, especially in areas where property is scarce. This can make one-third profit on the price of the property.

There are several books on self-building to
advise you. One snag is that it can be hard
to raise capital to buy vacant land.


Some properties will not sell because of poor decoration. A good way of making fast money is to buy such property, re-decorate it simply, then sell. It really does work. White painted walls sell over hideous and unusual wallpapers!

The scheme operates best in conjunction with renovation, but can work as a decorate-only project, i.e. no structural work etc.


Properties from older days were invariably large to accommodate large families and their servants etc. However, modern families require, and can only afford, much smaller properties. Hence one of the major property projects is in sub-division.

The typical way of doing this is to buy a large Victorian or Edwardian house and divide it up into flats. Often this is a very simply business. Sometimes it is more complex and would require an architect to design the sub-division.

If this project can be operated in conjunction with renovation, then so much the better, but it doesn't have to be. Such is the project that it's even possible to buy quite new houses and do this too.

Profits are possible on the basis that smaller homes are much more valuable per square foot than large ones. So, for example, a property worth $250,000 as a whole could easily be worth six flats at $70,000 each.


Where any of the property renovation or conversion projects can be applied to holiday type rental property, then the profits will generally be rather higher than for full time residential.

Original cost may be higher too - but not if you can find an area within a couple of hours of a major city - good for weekends and holidays.


At one time, commercial property was nowhere near as profitable as residential property. Since the latest price boom however, all of this has changed and office, factory and warehouse property especially, can be very profitable.

One of the most lucrative opportunities is the buying of large commercial units and sub-dividing them into smaller units for today's boom in small business.

Whereas at one time the trend was to convert residential property (large houses etc.) into commercial property, the reverse is now true. So, for example, mills, factories, even shops, are very profitably renovated and converted into homes!


Many property projects are very ambitious, but, in fact, most of them can be started without any capital via the syndicate method as discussed. If you have got the ideas - and the ideas are here - there are people who will put up the money. Making property a virtually, if not totally, capital free project!


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