By Ethan Roberts
This is the second in a two-part series. Click here for part one.
As we saw in the first part of this series, real estate investing is no longer exclusively a man’s world: more and more women are getting involved in real estate investing as a viable way of generating income. Some women—like 53-year-old Leticia, who I profiled last month—are “flipping” (buying to re-sell quickly) homes and making profits of 30% and 40% on their capital in just a few months.
But other women are approaching real estate investing from a different angle. Their strategy is to buy properties, fix them up, and then hold onto them for the long term, renting to an ever-growing population of tenants who, since the housing crisis, are choosing to rent rather than buy.
Large Rental Home Portfolio Will Fund Retirement
Barilynn, a 57-year-old divorced woman from Jacksonville, Florida, has been buying single-family foreclosures since 1995. She hires contractors to rehab the houses and then turns them into long-term rentals. She now boasts an astonishing portfolio of 23 single-family rental homes, while working a full-time job that demands cross-country travel almost every week.
Her portfolio is noteworthy in that 17 of the 23 homes, originally ranging in price from $35,000 to $120,000, are now completely paid off. That means the income generated from most of her properties is no longer reduced by mortgage payments, so she can use that cash to pay down the mortgages on the remaining properties faster.
At the beginning of her career, Barilynn says she faced several obstacles due to her gender. For one, the first few male real estate brokers she contacted wouldn’t take her seriously as an investor.
“One listing broker ignored me when I inquired about his investment property listings,” she says. “After that I found a wonderful female broker, and I bought 12 properties through her until she passed away.”
Another challenge was that contractors initially tried to take advantage of her by charging her more for materials and labor.
“I had to learn more about repairs so I wouldn’t get ripped off,” she says. “But what was even worse was that none of these contractors would let me open an account or give me credit. (I can’t always be there to pay by check at the time of the job, so it helps if they bill me later.) In fact, one guy said he couldn’t give me credit, and then offered to do just that for a male friend of mine!”
Her third biggest challenge has been, surprisingly, with other women.
“Some female tenants try to take advantage of me and treat me differently than they do my male partner when he collects the rents,” she says. “They try to appeal to me as a female by talking about how difficult it is for them as single parents to pay rent on time.
“I just tell them that I’m sorry, but I still have to collect the rent!”
Barilynn wants to buy a few more rentals so that she can maximize her income stream when she retires. Her biggest challenge recently, due to the high level of interest in foreclosures, has been to find good deals on properties that will yield a solid return on investment.
I asked her what advice she would give to other women who would like to begin investing in real estate.
“Don’t listen to people who say you can’t do it, or that tenants are too much of a hassle,” she advises. “I will live a much better lifestyle in retirement because I didn’t listen to the naysayers. Also, don’t invest in real estate unless you have some cash reserves, in case you need to make repairs or file an eviction.”
Women Pursue Commercial Real Estate Investing
Women aren’t confining themselves to residential income-producing properties. An increasing number of women own and manage commercial real estate.
Gerry, 83, has owned and managed a 26,000-square-foot office building in San Diego, California, since her husband passed away in 1990. The building has provided her with a major source of income—supplementing a minimal amount of Social Security payments and stock dividends—that has allowed her to enjoy a relatively high standard of living over the past 24 years. Drawing on her undergraduate degree in business from the University of California at Berkeley, she likes working with tenants and the satisfaction that comes from having a successful business.
“The biggest challenge I’ve faced was probably weathering the recession in the early 1990s right after my husband died,” she says. “Vacancies were up, as were expenses. These days, my biggest challenge is finding competent maintenance and repair people.”
I asked her what advice she would have for women who are interested in investing in commercial real estate.
“You need to do a fair amount of research into surrounding areas, traffic patterns, favorable locations, and availability of tenants for your particular facility,” she advises. “And if you don’t have a building manager, you should have some knowledge of accounting.”
How to Get Started
If you’re a woman who would like to get started in real estate investing, either in commercial properties like Gerry, or residential properties like Barilynn, consider joining a local real estate investing club, where you can network with other investors—male and female. There are also clubs designed specifically for women real estate investors across the country. One way to find these groups is through a site like Meetup.com.
Just remember: it’s 2014. Women real estate investors no longer have to feel invisible, be ignored, or get ripped off by service providers. If men can be successful real estate investors, and make a good living or prepare for a comfortable retirement, women can too!
Resources:
Field Guide to Women in Real Estate, National Association of Realtors®
