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How to Invest in Property With No Money in the UK

Written by, Marija Petkova

Updated April, 17, 2022

A lack of money upfront is the biggest reason why people put their investment plans on hold.  

Luckily, when it comes to property investing, there is a way around it. 

Here’s how to invest in property with no money in the UK. 

Can You Invest in Property in the UK With No Money Down?

There are several different strategies to invest in property with no money.

This type of investing is commonly called no money down investing and requires very little or no money to own or use a piece of property. For example, in some cases, you may need to pay a small fee, which can go as low as £1, to make the agreement legally binding.

You may find government-backed programs that can help you finance a property purchase with no money down or a private lender that doesn’t require a deposit. 

 However, it’s important to do your research before diving into it to ensure that you understand all the risks involved and avoid making any costly mistakes and mortgage fraud. 

Ways to Get Into Property Investment With No Money

Let’s take a look at the following strategies to buy property with no money.

Take in a lodger

Taking a lodger is one of the most affordable ways to get into property investing that can save you some money. 

The government’s Rent a Room program allows you to earn up to £7,500 tax-free in a year or half of that if you’re letting jointly. All owner-occupiers and tenants who let out their furnished housing in their primary residence are eligible for the Rent a Room scheme.

It’s important to note that joining the Rent a Room scheme will affect your Housing Benefit, depending on how the renter is classified, and you’ll no longer qualify for Council Tax Reduction.

REIT

REIT or a real estate investment trust is a company that operates, owns, or finances real estate that generates income. 

A REIT or real estate investment trust, like mutual funds, is a company that pools the capital of several investors to invest in real estate and generate income. Every investor earns dividends from their shares as part of the real estate investments without having to finance, operate, or own the real estate. 

This makes REITs a relatively low-risk investment that provides steady income.

Property lease options

Property lease options are underutilised real estate investments with low start-up costs. 

They allow investors to rent out a property without purchasing it and essentially control a property without actually investing money into it. 

Instead, the investor pays a minor amount of money upfront to make the procedure legal – typically £1 or less -sets a monthly fee and the length of your agreement, and then establishes a purchase price with the owner in case they want to buy outright later down the road.

Property lease options are often good deals for buy-to-let investors – they come with all the advantages of a steady rental income without having to get a mortgage.

Peer to peer lending

Peer to peer lending, often known as P2P lending, is a form of direct investment, in which you engage directly with another individual or firm rather than going through a bank to complete the transaction process.

This type of investing allows investors to get great return rates since there are no banks involved to take a cut. 

Peer-to-peer lending is also relatively liquid, which is typically hard to come by in real estate, and interest rates are frequently much greater than those provided by banks.

If you want to invest in peer to peer lending with an individual, keep in mind that these loans are typically unsecured, which means if the borrower defaults, you won’t get your money back. 

Property crowdfunding

Real estate crowdsourcing is a new kind of real estate investment that allows property investors to pool their money and acquire a fraction of the property.

The key difference between crowdfunding and peer-to-peer loans is that peer-to-peer lending puts you in the position of mortgage provider, whereas real estate crowdfunding gives you an equity share in the project.

Peer-to-peer loans allow you to offer a short-term loan, but you’ll need to keep your property crowdfunding investment for a while in order to see substantial returns.

Joint venture

A joint venture is a scaled-down form of property crowdfunding between two or more businesses. 

The businesses agree to pool their resources and expertise to complete a specific goal or task. In most situations, one of the businesses provides the cash, and the other technical skills and time. 

Regardless of what both parties bring into the joint venture, they share governance, ownership, returns, and risk

As such, a joint venture can be ideal if you don’t have any money to invest in property but you can find a business partner who has the cash but no time to deal with it. 

Use your equity

Your home equity is the positive difference between the value of your home and the amount of money you owe on your mortgage. There are several different ways you can use your equity for financial growth, though they all come with risks.


Using your equity to purchase property may not be the most expensive strategy for investing in property, but it can be incredibly costly if not everything goes according to plan. 

Thus, you should only consider this strategy if you’re certain that it will succeed and only if you have additional funds in case of any setbacks.

Buy UMV and flip

Buying Under Market Properties (UMP) for a profit that is worth less than the market value is one of the most popular property investment strategies and one of the simplest to get wrong if you don’t do proper research.

The best way to find this type of property is to look at auctions or off-market homes. This includes properties that have been repossessed. 

If you don’t have the funds, you can consider getting a bridging loan to finance the purchase without getting on the bad side of mortgage brokers.

When done correctly, flipping a UMV can generate large capital gains, as long as you do your research and anticipate most of the hidden fees and expenses that come with it.

Why Are People Interested in Buying a House With No Money Down?

Property investment can be lucrative and an excellent way to generate steady and passive income

The variety of options for buying a house with no money opens up the market to a wider population. Those who are looking for an opportunity to buy a house with no deposit can still invest in property by using strategies like entering a joint venture or property lease options.

What’s more, starting off early means that you’ll have more time to build equity and eventually, buy your own property.

Bottom Line 

If you’re wondering whether and how to invest in property with no money in the UK, there are plenty of options available –both for beginners and experienced investors. Regardless of how much (or little) you can afford to invest, there are ways to get into the property investment business, including some that require no money down.