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How much money do you need to invest in real estate?

Generally, to invest money, you have to have money in the first place. It can be your own money or , but you aren’t going to get far without it. And, in general, the more money you have, the more options you have and the higher returns you can achieve.

Money isn’t always easy to come by if you don’t already have it, so your first investment may just be your hardest to achieve. This is especially true in Canadian real estate where many people believe they need to save for a high down payment to purchase a home and begin real estate investing. That’s just one option, but it isn’t the only way.

There are several ways to invest in real estate and the amount of money you have will help you decide which strategies and options work best for you. If you are trying to save a million dollars from your day job to buy a home in cash, you aren’t going to be investing any time soon. Still, at the same time, you probably won’t see much success investing a loonie unless you have a few thousand years to benefit from compounding interest.

The trick is to find the middle ground that works best for you. This will depend on each investor’s own circumstance and goals, but generally, it will be based on how quickly you can acquire starting capital, how long you have to invest, how much risk you can handle, and what returns you want to achieve.

We will look at a few price points that you can begin investing from and what strategies work for investors at that level. We will also cover some ways that you can save or acquire funding for investments.

Starting from zero

Obviously, it can be difficult to invest with , but there may be more options than you think.

REITs and passive investments

For one, there are opportunities in real estate investments that don’t require you actually to buy up the funds to buy a home. For example, investing in something like shares of a can allow you to grow your money in the real estate market passively. While the cost of shares will vary between REITs, there are many affordable options that can allow you to start building your wealth in real estate even if you can only save a little.

You may have more money than you think

Beyond that, there may be money available to you that you just need to access. For many, this will mean tapping into the equity of an existing home. Many people pursue this option as a way to fund the down payment on an additional investment property. Naturally, you will need to repay a line of credit or refinanced mortgage and some interest, but it can make accessing a large sum of money to cover a down payment much more manageable.

Another option available to first-time homebuyers is to to go towards a home purchase. This will require you to have some savings in your RRSP, but it protects you from the tax implications of accessing it.

How to invest up to $100,000

If you have an amount of money under $100,000, you are in a pretty good position to start investing in real estate.

Purchasing a rental property

On the upper end of this range, you would be able to afford a down payment on a detached home in many areas, if not a townhouse or condominium. Unsurprisingly, this is one of the most popular ways to invest in real estate so the process will be pretty straightforward.

Don’t feel discouraged if you can’t afford the most upscale house in the nicest market. When buying a rental, you need to look at properties from the perspective of their potential for returns, not necessarily whether you want to live there or not. Frequently, the less expensive properties are the ones that grow the most in value and they are still able to provide favourable cash flow.

How much money do you need to invest in real estate?

If you are on the lower end of this price range, you could still pursue options such as a pre-construction condo purchase that can allow you to pay a lower amount now and give you time to save for the entire purchase later.

Renovate an existing property

You may want to consider some other options if your funding is not quite enough to cover a down payment on a property you like. For example, you could renovate a home you already own. This can add value to the property when you decide to sell. You could even add an additional rental unit to your home or divide an existing rental property and collect extra rental income on top of the added sale value.

Contribute to a real estate fund or crowdfunding

Finally, depending on the amount you have, you may be able to contribute to like a real estate fund or crowdfund. By doing this, you can work with other real estate investors to help your money grow together. This will usually cost a bit more than something like a REIT, but can provide great returns and save you the hands-on effort needed for other options.

Investing up to $500,000

With this amount of money, you could likely get a down payment on most homes and could buy a home outright in many areas as well. However, there are more options available than a simple home purchase.

Flipping homes

For one, you may be interested in house flipping. Though you can flip with less money, there are significant benefits to having more to work with. For one, it can make the process a lot easier to not have to deal with securing as much (or any) financing on your home, meaning you can flip faster and make more significant returns. A larger amount of cash also gives you much more flexibility to conduct needed improvements.

Multifamily and commercial real estate investing

At this level, you may also want to look beyond simply buying a residential property and consider larger and more expensive properties. Things like multifamily properties and other commercial real estate investments can offer new cash flow and equity opportunities for an investor, however, they can be harder to access with less money

Diversify with multiple properties

You could also look into acquiring multiple different properties. This may require multiple mortgages, so you will need to have the requisite income and debt ratios, but this can open up a lot of potential for you. For example, you could own rental properties in multiple different markets to diversify your portfolio. You could also own multiple different property types, or even branch out into areas like commercial in addition to residential real estate investing.


If you have millions to invest in real estate, you are in a very good position to grow your money even further. At this level, nearly all avenues are open to you.

The option of buying property still exists, though now you could look at very large assets or a large portfolio of multiple properties.

You could also venture into the development side of things, and fund the creation of new properties that you can then rent or sell for large profits. This will require a whole new skill set but can pay off a lot for those up to the challenge.

You may also want to consider being a private lender and providing your money to other investors for their purchases. This can provide you with great returns while your borrowers handle the legwork.

Diversify and consult financial advice

Overall, it would be recommended to diversify your real estate investments at this level. Though investing is a great way to grow your money, if you put all your eggs in one basket you risk losing a lot as well. Many smaller investments will perform better in the long run and shelter you from market conditions.

Furthermore, if you are dealing with money at this scale, definitely consider consulting financial planning or an investment advisor to help you figure out exactly what works best. At this scale, their guidance will be well worth the amount of money they will charge for their services.

Consider additional costs

When determining how much you want to put into investing it is important to remember that real estate can come with some additional costs that other investments may not.

For example, if you think you have enough for a down payment, you should remember that there will be closing costs in addition to the purchase price. Once you acquire financing, you will still need to have a consistent income to pay down the remaining balance.

Similarly, if you plan on buying something like commercial property, you need to consider the costs of things like property management that you will need to cover in order to keep your property profitable.

While it is good to get in sooner than later, you should also be sure to have some wiggle room so you can protect yourself from risk.

Why choose real estate investing?

It may seem counterintuitive, but real estate can actually be a great option when you have less money. This is mainly because of the great growth that you can achieve, and the ease of acquiring funding and financing when compared to other investments.

How much money do you need to invest in real estate?

Consider that with a mortgage, you can pay only the minimum down and still gain control over an asset that is worth much more than you put in. You can then benefit from things such as rental income and home equity before you have even paid it all off.

And, once you have, your home can even continue to increase in value. Another example is something like crowdfunding, where your smaller investment can purchase a stake in a much larger asset, that can provide you with returns you can’t get elsewhere.

For investors with less money, it can be a huge benefit to recognize where you can invest now, as it can help you grow your money faster and scale to larger investments even sooner. For those with more money, it is important to understand your options so you can make the most of your investments.

About the Author

Corben joined CREW as a relative newcomer to the field of real estate and has since immersed himself and learned from the experts about everything there is to know on the topic. As a writer with CREW, Corben produces informative guides that answer the questions you need to know and reports on real estate and investment news developments across Canada. Corben lives in Guelph, Ontario with his partner and their two cats. Outside of work, he loves to cook, play music, and work on all kinds of creative projects. You can contact Corben at or find him on Linkedin at

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