Even though more women are investing than ever before, you may be surprised to learn only 32% of real estate investors are women according to Zippia. Since real estate has always been associated with building wealth, why aren’t there more women investing in real estate? Whether it’s just a lack of confidence or not knowing where to start, it’s time to get more women comfortable with their investing abilities. Here are five tips for building confidence as a real estate investor.
1. Join Your Local REIA or Real Estate Group
Real estate investors starting out today have so many more resources available to them than investors in the past. There is a multitude of great information available online. However, this cannot be your only source of information, and nothing replaces networking in person and making connections in your local area with investors that understand what works in your market. Listening to podcasts and webinars from successful real estate investors all over the country is a great way to educate yourself on real estate investing in general, but the knowledge you’ll get from developing relationships with people in your own area is priceless.
“There are a lot of great, amazing gurus out there, but what I find is not a lot of the gurus live in your state,” said Shenoah Grove, owner of multiple REIA across Texas. “Be careful of who you learn from. You want to learn from other people in the same area that have access to the actual contracts, the title companies, the contractors, the attorneys.”
Join your local REIA or go to Meetup and check out groups near you until you find one that is the right fit. Grove said when she joined her first REIA, “I made it my purpose in life to get to know every single person who walked in that door as part of the Real Estate Investors Association. I knew who had deals. I knew who had money. I knew who had tribal knowledge. I knew who had the power team, the network. I knew who had all of the different resources that I was going to need to be successful, so I spent a little bit of time ingratiating myself and getting into some of those networks to be able to grow my own.” To learn more tips on where to find groups and how to network more effectively, read our article “Making Connections: Are You Networking the Right Way.”
2. Find a Mentor
Having a mentor is valuable for any career field, but especially when you are getting started making real estate investments. A mentor is an experienced and trusted advisor who provides guidance, feedback, assistance with problem solving, and offers support to their mentee. Knowing that you have someone knowledgeable and experienced by your side to guide you through the ups and downs is critical. Grove said, “I’ve had multiple, and I think it’s the difference between taking the stairs and taking the elevator.”
Where can you find a mentor? The easiest way is to look for one in your professional network. This is another reason why joining a local REIA or real estate investing group is so important. You can also meet potential mentors at networking events, online real estate forums, and asking other investors. Look for someone who is like-minded and has the same objectives as you and will be a real sounding board. Don’t select someone just because they are successful, but because they can provide you with the feedback and assistance you need to get to the next level.
3. Don’t Try to Do it All Yourself
Women are notorious for trying to do everything themselves. While being self-sufficient and independent are great character traits, this can lead to burnout when you are building your own business. Asking for help is not a sign of weakness, but part of a growth mindset. “Self-sufficiency, in a way, is a recipe for poverty because when you are 100% self-sufficient then that means you can’t grow and scale your business,” warns Grove.
This is why it’s so important to build your team. Surround yourself with people you trust who specialize in what you need to build your real estate business. For example, some investors erroneously think they need to have a real estate license to be a successful investor, but this is not the case. While you may save a little money on the front end, there is so much more a real estate agent brings to the table, including helping you find deals and negotiation.
The same reasoning applies to other specialties. Unless you are a contractor, why try to do the remodel work yourself, when someone else can do it faster, better, and more efficiently? The longer it takes you to remodel, the longer the rental property is off the market and costing money instead of generating income. (And if you are using a self-directed IRA to fund your investment, you are prohibited from doing the work yourself.) “I realized self-sufficiency was going to cause me to instead of doing 10 deals a year to do one or two,” said Grove.
4. Analyze Don’t Romanticize
Finding that first investment can be exciting, and new investors can sometimes let their emotions get in the way of the facts, but you still need to do your due diligence. “Our coach taught us 20 years ago scenario analysis – best case, worse case, most likely case. But what I find from every brand new investor is they do not do just the best case, but the best case on steroids – the highest ARV, the lowest repairs, the shortest amount of time to get those repairs done, and the shortest time on the market.” It’s important to be realistic and stress test your scenario to see where your model breaks, so you know if you can survive if the worst-case scenario happens.
When analyzing the deal, it’s also important to understand the economics of your market. For example, if you are interested in short-term rentals, but your market is oversaturated, then even if you found the perfect place to turn into a rental, it may not be the best investment in that market. If analyzing numbers isn’t your skillset, find someone that can help you with this. You are building a business, and you need to understand the analytics and the supply and demand of the market you are investing in to make smart decisions.
5. Learn About Financing Options
Investors who are just getting started often believe that the biggest roadblock to investing is money, but this isn’t true. As you gain experience you will learn there are many financing options available and the more you understand those options, the more it opens up new opportunities. “Make sure you have financing in place to weather whatever storm is trying to punch you out,” Grove advises. “You need to make sure you have financing as a partner as opposed to financing as a vendor.” A vendor will foreclose on you when the market drops, but when you are financing as a partner, they will work with you. “Make sure your financing is for the win even if it’s going to cost you more money.”
One option for financing is using self-directed IRAs. If you have a 401k from a past employer, you can rollover that money into a self-directed IRA and use that for investing. Or if you would like to get your feet wet with a more passive approach, you can start with note investing and loan money to other investors. Once you understand the process, you can tap into this source of funding to raise capital for your own investments. To learn more about how to get started investing with a small amount of money, watch Quest’s webinar $10k or Less: Making Big Bucks in Small Accounts – YouTube.
Real estate investing is open to everyone, and there is so much information available to help you get started. Learn as much as you can from books, podcasts, webinars, and other online sources, but also get out there and join investing groups and start making connections. Being a part of a community of like-minded investors, finding a mentor, building your team, taking an analytical approach to your investments, and learning more about financing are all important pieces of the puzzle. Once you’ve put the pieces together, your confidence will soar and so will your portfolio!
Quest offers free classes weekly on a variety of subjects so make sure to bookmark our events page and check back regularly to see if there is a class that’s of interest to you. Self Directed IRA Live Events & Webinars | Quest Trust Company
Watch Shenoah Grove in How to Use Alternative Assets to Set Yourself Up for the Future… The Right Way – YouTube and learn more tips and insights about getting started in real estate investing. She is also a regular speaker at Quest Expo and Quest Con Live.