• Mon. Dec 4th, 2023

Uganda, Kampala | Real Muloodi News | Real estate investments have produced more wealth than any other industry. Yet, many individuals in Uganda don’t know where to start, or how to invest in real estate.

The biggest obstacle is the belief that you need a large sum of capital to get started in real estate investment. This isn’t always the case. In fact, the secret behind real estate success is; start small so as not to get burnt.

The success story of Kent Clothier, founder and CEO of Real Estate Worldwide, is an example of this. Mr Clothier started out with $500 (about Shs1.8m). He found a distressed home and brokered a deal with a motivated buyer. Today, Mr Clothier flips over 1,000 properties and manages 5,000 through his company.

Even Real Muloodi Sudhir Ruparelia started as a casual taxi driver in the UK. Sudhir has built an empire brick by brick, and now he is arguably the wealthiest property mogul in Uganda.

The point is, you do not need an abundance of money to make it in the real estate industry. Even if you are just starting out with a small amount of capital, with a steady income, focus and persistence, you can make money in real estate.

Getting Started

You may ask yourself, “How can I invest in real estate with only a small amount of capital?” There are a number of ways to get started:


Real Muloodi News recently told the inspiring story of how one woman started off saving USh50,000 per month from her meagre salary of USh250,000. Through diligent savings, hard work and perseverance, Anna Kebba constructed apartments and became a landlord. Read about how she did it here

Real Estate Investment Clubs

Real estate investment clubs involve individuals who want to form a group to invest specifically in real estate. Members pool their finances together and invest it in a particular property or purchase land to develop for commercial, industrial, or residential purposes. In this article Real Muloodi News explains real estate investment clubs in detail.

Lease to Buy Options

Lease options allow the buyer to lease a property from a property developer for a specific period, with the option of purchasing it at the end of the lease. The buyer pays rent throughout the lease, and sometimes, a percentage of the rent is applied to the purchase price, or can be used to support a mortgage application.

Leasing with an option to buy does not need a significant amount of capital. Further, you could sub-lease the property to someone else as additional income to put towards the purchase price. 

This option is most beneficial when the real estate market is rising. If the property significantly increases in value during the lease term, you are getting a below-market rate when it comes time to purchase. You might even resell to someone else for a profit.

To learn more, read our recent article, What You Should Know About Rent-to-Own Deals.

Taking Over a Distressed Mortgage 

You may look to take over someone else’s mortgage payments who might be in a distressed situation. Distressed debt most commonly describes a scenario in which a homeowner defaults on their mortgage loan payments, and thus their property becomes distressed. Other ways that a homeowner can encounter distressed debt include not paying off their loan by the time it reaches maturity or becoming delinquent on property taxes. 

One of the significant benefits of buying distressed mortgages is the opportunity to purchase property at below market value.

Borrowing from a Bank

Many believe that getting a bank loan in Uganda is too difficult. However, to most Ugandans’ surprise, getting loans from banks to purchase property is not as difficult as you may think, so long as you have a steady income. The bank will base the loan amount on your provable income; typically, you must have a monthly repayment amount not exceeding 35% of your monthly income. 

Home Equity Line of Credit

If the home you live in has gone up in value over time, you may be able use the equity in your house as collateral to secure a loan for a real estate investment. 

Hard Money Loan

A hard-money loan is simply a short-term loan secured by real estate. Private investors (or a fund of investors) instead of conventional lenders such as banks or credit unions fund hard-money loans. The terms are usually around 12 months, but the loan term can be extended to longer terms of 2-5 years.

However, it is important to borrow within your means. In a recent article by Real Muloodi News, ‘Real Muloodi, Sudhir Ruparelia shares Secret Behind His Success, Sudhir advises not to overextend yourself with too much debt. Anyone striving to succeed in the real estate business should attentively listen to Sudhir’s advice:

“Do not expand quickly, outside your means,” Sudhir cautions, “Allow organic growth. So long as you have a good amount of cash flow coming in, you need to first focus on projects which you can fund.”

In Part 2 of this series, we explore different kinds of real estate investments to turn a profit. 


How to Invest in Real Estate and Make Money – Part 2

Real Estate Investment Opportunities and Land Prices in Kampala