millennial couple learning to Start Flipping Houses With No Money

How to Start Flipping Houses With No Money

Millions of Americans annually wonder how to start flipping houses, but, how do you do it with no money? The real estate market is a harsh environment for those who don’t already have their feet on the ladder. 

Real estate investing for millennials is a very tricky game, especially as property prices have continued to soar throughout the first few years of the 2020s, while the average wage trails behind. 

Many people, particularly those born after 1980 and classed as “millennials”, as well as individuals from younger generations, struggle to figure out how to start flipping houses with no money, or at least with minimal capital.

However, there are always options – including a number of smart approaches you can make to forge a path into the lucrative world of house-flipping. 

In this article, we examine how to get into flipping houses if you don’t yet have considerable savings to draw upon. These tips and tricks are likely to come in very handy if you’re planning to make a start in the real estate sector.

See our FAQs below for a definition of the term “flipping houses”.

Seek Out Relevant National or Regional Home Buying Schemes

Depending on your background and where you live, you may be able to access a little support when it comes to purchasing property. 

In the UK, for example, the government launched the “Help to Buy” ISA (Individual Savings Account) in 2015. People planning to buy their first property could pay a maximum of 200 GBP (around 270 USD) per month into their ISA account.

If these savings were then used in the purchase of a property, the government would add a 25% bonus on top.

This scheme was closed in 2019, but there are still other options – such as the Lifetime ISA – available to UK-based  first time buyers.

It may be that you do not qualify for any assistance, but it is worth consulting the internet and perhaps seeking guidance from a financial advisor to see if you might be missing out on support of this kind where you are based.

Look Into Short Term Funding

In some circumstances – and depending on your location – you may be able to acquire a short term loan for the purchase and/or development of a property. 

Look into established private lenders in your area and research their requirements regarding your credit score, your intended project and the contents of your application. 

Before you can borrow, you’re likely to need a clear budget laid out as well as a detailed plan of any changes and renovations. You will also probably need some form of collateral and to be confident that you will be able to repay the amount with interest in the time scales specified.

It’s rare that loans are available purely for the purchase of a property. However, if you plan to set up a business, there may be other avenues open to you.

As well as private lenders such as banks, you could also consider making contact with potential “hard money lenders” such as individuals or companies – but make sure that any contract with them is totally clear and legally sound before you commit to any arrangement.

Seek Out Foreclosures

A great way to find affordable properties of quality is by seeking out foreclosures for sale. But how do foreclosures work?

A foreclosure is simply a property that has been repossessed by the relevant money lender or investor when its resident or owner has failed to make sufficient mortgage payments after a pre-agreed period of time.

Usually, the party that has repossessed the property then goes on to sell it to a new owner via one of a range of different platforms. 

It can be risky to put down money on a foreclosure, as you aren’t usually able to view it in full before you make a purchase – and properties of this kind are commonly left exactly as the previous occupants left it.

This means there is a chance of structural or maintenance issues as well as cosmetic damage, pest infestations and general mess or untidiness. This can be costly to rectify, so it’s important to do as much research as you can before taking the plunge.

So: how to find foreclosures? As we’ll go into below, one of the easiest ways to find foreclosures is to attend a property auction. You will be able to find information about whether or not particular properties are foreclosures when you look into the details of what is for sale.

You may also be able to find foreclosure listings via bank, mortgage lender or asset management company websites, relevant government agency sites, sheriff’s sales, county records and even just by contacting individual real estate agents.

Go to Auctions

Real estate auctions and property auction sites are great places to seek out affordable property – including bank owned buildings and foreclosures, as detailed in the above section.

But what is a real estate auction? Simply put, it’s a location, website or event where individuals, banks, businesses or other parties offer up property to potential bidders. 

Starting bids or “opening” bids are put forward, but attendees are permitted to make any and all offers above that figure as long as they have access to the right amount of capital.

So, how to buy real estate at auction? You can do so personally, by attending the auction yourself, or you can use a proxy such as a solicitor or agent, who will need your written authorisation and access to the required funds.

If you’re wondering how to bid at a real estate auction, that will usually be made clear to you on the site or at the location in question. In-person auctions may include the use of paddles or other visual signals, while online versions may rely on other approaches.

Make sure you stick to your budget and place your bid clearly. It’s extremely important to understand that if you win an auction, you are totally committed to go through with the purchase, so it’s important to be absolutely confident before placing a bid.

If you intend to borrow money to make a purchase at auction, you must be officially pre-approved to do so – and it’s vital to check the individual auction house’s stance on this matter in advance.

Auction real estate is popular with buyers on tight budgets, as final bid amounts may fall considerably short of a property’s market value. This means it can be very easy to find great properties at bargain prices.

However, it is worth noting that property may have been put up for auction due to structural defects or some kind of legal dispute. 

For this reason, you should try to find out as much as you can about the building you’re going to be bidding on to avoid having to spend much more putting it right or fighting entering legal battles!


Real estate crowdfunding is currently booming – after all, platforms of this kind allow for individuals and small businesses to invest in real estate without needing access to huge amounts of capital.

There are a range of ways in which you can crowdfund the purchase and development of your first property. 

For example, why not look into tokenisation? This approach allows you to break your property down by area, enabling investors to fund a certain number of square metres. Any profit you then make from the lease or sale of the property can be divided between donors, rather like stocks.

Of course, you’ll need to take care not to put too much of your property up for grabs, as you could easily be left with heavily depleted profits – particularly if the house ends up fetching a lower price than you expected.

On a smaller scale, you can simply team up with a group of friends and pool your resources to make your first purchase and renovate the property. If you do this, it is important to have proper legal documentation in place and to make sure general consent is given for every decision.

Again, you need to make sure this is worth your while. Dividing the final amount between a large group can mean you each receive a fairly small sum.

There are plenty of platforms and organisations that specialise in real estate crowdfunding – so take a look on line and be sure to carefully examine each option before coming to a final decision.

Consider Wholesaling

Wholesaling is an approach to real estate investment that doesn’t have to necessitate the acquisition of a physical building. It tends to involve off-market properties that are in need of renovation but have the potential to be worth a great deal. 

A wholesaler who discovers a property of this kind locates the owners of the building and offers to find an investor who can then be contracted to take it on, renovate it and sell it for a considerable profit. 

The wholesaler receives a fee for their trouble and the investor, who has purchased the property from the original owners, receives the profits.

In this case, there are two separate opportunities – you could start off as the wholesaler in order to raise funds to start flipping houses, or you could partner up with a wholesaler who will help you to find affordable contracts as a house flipper

Find a Backer

This approach is getting rare in current times as it requires a great deal of trust, but it is still possible to go into business with a “backer” or benefactor if you have the right connections.

This approach is similar to crowdfunding. Simply put, you enter a professional partnership with an individual or business with enough capital at their disposal, then use the funds they provide to purchase and renovate properties.

You and your backer then split the profits to a pre-arranged ratio. In order to secure funding from a backer, you need to be able to totally convince them of your skill and capacity to make considerable returns from the project in question.

In a scenario of this kind – similarly to others mentioned in this article – it is vital to create a legally binding and fair contract to be signed by both parties before the project begins.

Equity Release

 If you’re already a homeowner with a mortgage – and if you’ve been paying off that mortgage for a number of years, you might decide to release some of the equity that has built up in that property in order to purchase and renovate an additional building.

Be careful, though – you don’t want to take out more cash than you need to or you risk losing your home. 

Releasing equity in order to purchase an additional property could also reduce the amount of inheritance any of your heirs may receive, particularly if you are unsuccessful in your flipping ventures.

Lease Option

If you’re looking for a property to rent, but you’re also wondering how to start flipping houses, you may be in a very fortunate position.

Consider seeking out properties with “lease options”, sometimes known as “option to buy”. A lease option is an agreement made between a landlord and tenant whereby the tenant will be offered the option to purchase their rental property at the end of a pre-agreed period.

The sale value of the property is usually agreed at the start of the rental period, which means that even if property prices rise, the tenant/potential buyer will still be able to pay the same amount when the time comes to make the purchase in the future.

The tenant will have priority over all other potential buyers – even if they have bad credit.

What’s more, a fee is usually paid at the start of the tenancy, which is put towards the possible eventual downpayment. This makes lease option a great choice for individuals who would otherwise find it difficult to make a downpayment all in one go.

Credit Cards and Credit Card Advances

This is perhaps one of the riskiest options when it comes to finding the capital to pay for the purchase or renovation of a home – although that risk is significantly reduced when this approach is combined with any of the other techniques in this article.

Use credit cards for significant transactions of this kind at your own risk. You need to be sure that you can repay everything you have spent within the interest-free period specified, otherwise you may get hit with crippling amounts of interest.

If you opt for a cash or credit card advance from your credit card provider, this is still more vital – after all, you’ll start paying interest from the date the advance was arranged.

This option should really only be utilized if you’re confident of large, short-term profits.

Do it Yourself

Most flippers plan on “doing up” houses and then selling them on for a profit. This means you’ll probably be on the lookout for a fixer upper. 

The key is to find the right balance. You need to make sure that the money you’ll be spending on renovations will not surpass the amount you’ll eventually make when selling the property. You want to make a gain, not just break even or lose out.

To this end, it’s important to budget carefully. Many people find that – with their first property at least – it’s best to do the majority of the legwork themselves or with the help of a few friends.

Labour can be exceptionally costly, so this is a great opportunity to cut out a major expense with “ease”. Of course, it’s important to know what you’re doing. 

We highly recommend leaving specialist or dangerous tasks like rewiring to trained experts. After all, as well as avoiding potential injury, you’ll likely need these aspects to be officially “signed off” by way of a certificate that you can pass on to your buyers when you sell the house.

However, why not look into repainting, tiling, carpeting and even plastering or putting up drywall yourself? There are plenty of superb free video guides online that you can use to teach yourself these skills.

Live in the Property

It may be tough going, but if you can handle living in a property while it is being renovated, you could save a great deal of money. Having to pay rent or a mortgage in one building alongside redecorating or refurbishing another can really drain your funds – as can travel between the two.

Of course, if you make enough of a profit on your first property, you may have the cash available to live elsewhere when it’s time to take on your next one.

Bargain Hunt

If you decide to take on the renovation of a property yourself, try to be as smart as possible when it comes to buying materials, equipment, fixtures and fittings. This will take your overheads right down and maximise your future profit.

Check out sales at hardware stores and online, and try to pick up end-of-line stock and discontinued materials for low prices without any reduction in quality. You can browse online listings for high quality second hand furniture and tools, too.

Even items that are slightly worse for wear can be given additional value; why not teach yourself to strip back and refurbish or reupholster old fixtures for an attractive finish at a fraction of the cost of new designs?


Try to look for property that only needs cosmetic repair and refurbishment – a lick of paint, a new front door, a new carpet, fresh kitchen cabinet doors and so on. If a building has major structural issues, or a major layout change is required, the expenses can quickly mount up.

The amount of value you can add by simply pruning and mowing the garden, refreshing the walls and giving the place a good clean is very surprising, and it barely costs anything at all.

This approach will work best if you’re willing to accept a relatively small return on your early investments, taking on slightly bigger challenges each time as your budget grows with every sale.

Split Up Your Property

Wondering how to get started flipping houses if you already own property but don’t have much of a budget? Why not consider building on any land attached to your home, then selling that – or splitting your property into separate apartments?

It’s important to check with your local authority and planning department to make sure you’ll be permitted to register a new property – but this approach can totally cut out the cost of purchasing a building in the first place.

Throughout this article, you’ll have found numerous valuable tips on how to start flipping houses with no money or minimal capital behind you. 

The key to any venture of this kind is to alway understand the terms of any loan, agreement or contract, and to always have secondary plans in place in case your initial approach falls through – so that you will remain financially stable and legally sound no matter the outcome.

House Flipping Houses With No Money – FAQs

What is “Flipping Houses”?

The term “flipping houses” refers to a means of making money whereby an individual, group or company purchases a “fixer-upper” property for a low price, renovates it to a higher standard and then sells it for a profit.

How Do I Get Into Flipping Houses?

Getting started flipping houses is very straightforward if you have sufficient financial backing and free time to invest. 
It is possible to make significant gains via this method, with many house flippers climbing a long way up the property ladder and growing wealth as a result of their endeavours.
All it involves is the purchase of a property and the capacity to undertake or arrange high quality renovations in order to raise the value of the building enough to turn a profit when it is sold.
It’s important to budget properly to ensure you won’t be overspending on the renovations and thus reducing your potential profit margin too heavily.

How Much Money Can You Make Flipping Houses?

According to SmartAsset’s A Beginner’s Guide to Flipping Houses for a Profit, the average gross profit for US house flippers in early 2020 was just over $60,000, suggesting a percent return of just under 37%.
Of course, it’s important to take into account the costs involved in purchasing and renovating property, along with the fees inherent in selling a house, in order to work out the resulting gross profit. 
The key is to keep overheads down and focus on raising a building’s value as far as possible to turn the best potential profit.

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