How much money do I need to start a property portfolio?

How much money do I need to start a property portfolio?

How much money do I need to start a property portfolio?

While the long-term benefits of property investment are there for all to see if you look back on historic price movements, how much money do you actually need to start your very own property portfolio? This is a question which more and more people are asking themselves as property becomes even more sought-after especially in the aftermath of the 2008 mortgage crisis which had a major impact upon property prices.

First of all, it would be wrong to suggest that building your own property portfolio is simple, can happen overnight and will not be without challenges. The fact is that if it was that easy then everybody would be doing it!

Starting capital

It is difficult to say what kind of starting capital you would need to set up your very own property portfolio but the simple fact is the more money you have to invest, the less you have to borrow which means lower interest payments. Then again, you have to balance this against the risk reward ratio of a property investment and ensure that you leave yourself enough money to get by.

Quote from : “At this moment in time even the most sensible of investors are struggling to obtain finance for many property projects around the world. It is sometimes easy to forget that these are investors who have slowly but surely built up their assets, never over-extended themselves on the financial front yet somehow they are paying the….”

There is also the matter of disposable income which you can also use to put towards your property portfolio investments going forward. In a perfect world the rent on your property should pay a large portion of your monthly mortgage liabilities although there will be maintenance costs, there may be times when your property may be empty and there may be issues with tenants going forward. The simple fact is that the larger the savings buffer you have between your liabilities and your income from your property portfolio the better.

Don’t overextend yourself

If you’re looking to move into the property letting market then you should do your homework first of all to ensure it is exactly what you are after. Many people will read about the more favourable side of the industry with issues such as rent arrears, maintenance and other problems often ignored. If you are prepared to take on a significant amount of work going forward, if you have the time to manage properties in the early days and you go in with your eyes open, then why not?

The best bit of advice I was ever given was to start small, work your way up and make your mistakes in the early days. You can read all the magazines, you can read all of the books and you can read all of the websites but the fact is that you will make mistakes when building your property portfolio. It is better to make these at an early stage and learn rather than later on when perhaps there is more money at risk.

Do not underestimate the work required

In theory buying a property and letting it to tenant should be easy, simply arrange the finance, buy the property, find a tenant and hey presto you have a long-term income stream. It is not always as easy as that and many people will bring in third parties to manage their properties although there is obviously a cost involved in this. Even if you were to bring in a third party to manage your property portfolios there will be issues you need to address, there will be problems that you need to sort out and it is vital that you keep your finger on the pulse – do not become detached from your property investments.


There is no real set figure when looking to build your own property portfolio but the fact is that the bigger the buffer between your savings and your income against your mortgage liabilities then the better. It will not be plain sailing but if you do your homework, if you have a strategy in place and if you stick to the strategy then there is no reason why you should not build up a successful long-term property portfolio.

Good luck!

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