How Can College Students Invest in Real Estate Without a lot of Money?

Investing in real estate is a great way to get ahead in life and retire early. It can be difficult for many people to invest, especially college students because of the money required to buy real estate. But there are any ways to get started investing in real estate without a lot of money. The sooner you begin investing in rental properties, the better off you will be and if you can buy properties while in college you will be in a great position later in life. Investing in real estate was not on my mind when I was in college, but I wish it would have been. If I would have started investing in real estate much earlier I would be much better off than I am today.

For more information on my investing strategy, rental properties and fix and flips check out my complete guide to investing in long-term rental properties.

Why should college students invest in real estate?

I own 11 long-term rentals, fix and flip 10-15 homes a year and sell 200 homes a year as a Realtor. I have a definite bias towards investing in real estate, but that is because I have made a lot of money with rental properties and fix and flips. I wish I would have started investing in real estate much sooner and worked hard at selling houses as a Realtor much sooner. When I was younger, I was much more concerned with having fun than I was with setting goals and making it big.

Fix and flips are great for producing income, but fix and flipping is more of a job than it is investing. Rental properties on the other hand produce long-term cash flow, which is what really builds wealth. The longer you own rental properties, the greater their benefits are. Rental properties have great tax advantages, can be bought below market value (giving you instant equity), provide cash flow every month and are a great hedge against inflation. Inflation will cause rents and home values to rise over time, but if you buy rental properties with a fixed rate mortgage your payments will always stay the same. The sooner you buy rentals, the more money they will make you and college is a great place to get started. You don’t have to be in college to get started with investing, any young adult can buy properties and start building an empire.

Another reason for college students or young adults to invest in real estate is that life has not gotten in the way yet. We all have great intentions to invest, but when you get a job your focus moves to making money and that job. Then you get ahead in your job and you get married and have kids. All of a sudden all of your free time and money is gone! When you are finally ready to invest in real estate, 20 years has passed since college and you are starting from scratch. It is not a bad thing to start investing at any age, but the sooner you start the better off you will be. In college you have the freedom to invest and the sooner you start, the easier it will be to continue investing and build something great.

What type of real estate should a college student buy?

All of my rental properties are single family homes, but that doesn’t mean everyone should focus on single family. In my area single family homes cash flow better than multifamily homes and I can get a better deal on single family homes. In some areas, multifamily homes may cash flow better and college students may be better off buying multifamily properties because of their living situation.

When a college student lives off campus they have to pay rent for a house, apartment or bedroom. One advantage to owning a house is the college student no longer pays rent. They have to pay a mortgage, but that mortgage payment helps pay down the loan on the property over time. If they buy a multifamily property or a house they can have the remaining bedrooms rented out. Then the college student can live in the house for free because the money they make from renting out the other units or bedrooms will pay their mortgage for them. If you find a really good cash flowing property you can make money every month on top of living in the property for free.

Once the college student graduates or moves on from college, they can continue to rent out the property to students and make even more money every month. If you are renting out bedrooms in a house make sure you know the zoning laws. Some towns will not allow multiple unrelated people in single family homes.

What are the biggest obstacles college students face investing in real estate?

Buying real estate takes money, I don’t care what anyone says, you will not be able to start a real estate empire without any money. Most banks require 20% down when buying a rental property, but college students do not have 20% down to buy a property. Luckily there are ways to get started with less than 20 percent down, especially for young adults.

How can college students put less than 20 percent down on rental properties?

I talk about how much it costs to buy a rental property here, however there are ways to put much less cash into a property. Banks require investors to put 20 percent down, but they require much less for owner occupants. One great thing about college students who invest in real estate is they may not be picky about where they live. If you can buy houses or multifamily properties that you can live in for a year, you can get started with 5 percent, 3 percent or possibly no money down.

Even if you buy a property with no money down, you will still need some money. You have to account for vacancies and maintenance as a real estate investor and on a great deal sometimes you need a house that needs repairs.

For more information on getting a loan on rental properties including low money down loans check out my 99 eBook How to Finance Multiple Rental Properties. The book is available from Amazon or as a PDF here for only $6.99.

How can a college student qualify for a loan on a rental property?

Even if you can buy a house with no money down, you still have to qualify for the loan. That means a college student will need income, good credit and a good debt to income ratio. These are many things that college students lack! It is easy to rack up student loans to pay for school and housing. It is easy to miss a couple of payments here and there while getting started in the world without much money and most students don’t have a lot of time to work at high paying jobs.

It is very tough for college students to qualify for a loan without help. The good news is that it is easy for students to get help qualifying for a loan. A kiddie condo loan is a loan that allows a college student or young adults to have co-signer on a mortgage. The student still needs decent credit, but if the co-signer has a good income and debt to income ratio the student can buy a house. The student has to live in the house, but the co-signer does not and they will still qualify for the low down payment owner occupant loans.

How can a college student find a co-signer for a loan on rental property?

Not everyone has a rich uncle, but it sure helps if you want to be successful in real estate. If you don’t have a rich uncle you can ask parents, siblings, grandparents, cousins or any blood relative to co-sign on a kiddie condo loan. If you are embarrassed to ask someone for help; don’t be. My guess is that whoever you ask will be impressed that you are thinking about investing so early and they will be anxious to help if they can. Remember the very richest people in the world constantly ask for help and constantly learn. Don’t be afraid or too proud to ask for help building your future. Remember if someone says no, ask them if they know someone who might want to help.

How can a college student earn extra money wholesaling real estate?

One way to get started in real estate with virtually no money is wholesaling. Wholesaling is buying and selling houses or contracts to buy houses without investing your own money because you sell them right away. In order to sell a house right away you have to get some smoking deals. Some people wholesale off the MLS, but the really good wholesalers find properties that aren’t listed. My blog is not about wholesaling but here is another article with more information on it.

The great thing about wholesaling is it teaches you how to find great deals. If you can find great deals in real estate you can make money, because that is one of the hardest parts of the business. The sooner you learn how to find deals, the better off you will be, even if you aren’t able to buy those deals yourself.

Should college students fix and flip houses?

I fix and flip a lot of houses, but fix and flipping takes a lot of money or a partner. If you want to flip by yourself as a college student you are going to need to build up a bankroll or have a rich uncle that will loan you money. Since most people don’t have that rich uncle you can try to partner with investors on flips. The problem is convincing a partner that it is a good idea to partner with you. What do you have to offer the partnership if you have no money? This is why it is important to know how to find great deals. If you can find deals that can be flipped for a profit, you can find investors who will partner with you or buy the properties from you (wholesaling).

Another way to partner with an investor is to offer physical labor. Once again an investor is not going to partner with someone just for the fun of it. If you have plumbing, electrical, roofing, carpentry or other experience, maybe an investor will help teach you the business in return for work.

What if you can’t find a co-signer, a partner and you can’t qualify for a house?

It’s not easy to buy real estate when you have little money, little credit and little time. Wholesaling is one option for college students, but is not easy to do either. The best opportunities to get ahead in life are rarely easy. There is a chance you could do a lot of work in college to invest in real estate and never buy a property. Even if you never buy a property, but learn the ins and outs of your market while in college you will be better off than 95 percent of people out there. I’m not saying you should not try to buy property, but if you don’t you will be better prepared to succeed once you are out of college.


The sooner you can purchase rental properties the better off you will be if you buy them below market value and they cash flow. If you can manage to buy them in college you will be way ahead of the game. If you have more questions please check out the InvestFourMore discussion forum.

For more information on how to buy the best rentals which will make the most money, check out my book: Build a Rental Property Empire: The no-nonsense book on finding deals, financing the right way, and managing wisely. The book is 374 pages long, comes in paperback or as an eBook and is an Amazon best seller.


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