New Funding Resources 
Last week, we celebrated March 8th—International Women Worker’s Day, a global day celebrating women’s social, economic, cultural, and political achievements. While I am grateful to all women in my life, today, I want to express my appreciation for hardworking, resourceful, insightful, persistent, and super intelligent women in real estate. Your dedication, perseverance, and leadership have transformed communities, shaped skylines, and inspired future generations.
While plenty of women found fantastic fortunes and fame in real estate, the women we work with every day – title agents, realtors, underwriters, mortgage brokers, appraisers –are the true movers and shakers. They are also perfectly positioned to succeed as real estate investors and many of them already do. Throughout the years, we worked with hundreds of women investors in the Washington, DC area who leverage their skills and talents in real estate to grow their income, diversify their portfolios and build their retirement nests. Yet, it remains that the majority of real estate investors are men.
Predictably, this disbalance can be attributed to various historical, societal, and economic factors. For example, legal restrictions have historically limited women’s access to property ownership and financial independence. To put it into perspective, while married women were allowed to own property in their own name by 1900, they had to ask their husband’s permission to apply for a mortgage until 1974, when the Equal Credit Opportunity Act prohibited discrimination for reasons related to sex, marital status, race, religion, and other reasons. In the U.S., 1974 is often cited as the year of women’s mortgage liberation. For this and many other historical and cultural reasons, men have traditionally had greater access to capital and financial resources, often necessary for real estate investments.
All these historical and cultural reasons aside, I am convinced that women are well-positioned and uniquely qualified to thrive in real estate investing today. Here are at least some of the reasons.
Advantages Women Have it Real Estate Investing
Women dominate real estate sales
In the United States, women comprise a significant portion of licensed real estate agents. According to the National Association of Realtors (NAR), 66% of Realtors in the U.S. were women. This percentage has been steadily increasing over the years, reflecting the growing presence of women in the real estate industry.
As the dominant force in real estate selling, women have unique access to:
- Market Knowledge: Real estate agents have a deep understanding of the local real estate market, including trends, pricing, and investment opportunities. This knowledge can give them an advantage when identifying potential investment properties.
- Access to Listings: Real estate agents have access to a wide range of property listings, including off-market opportunities and distressed properties, which can be ideal for investment purposes.
- Understanding of the buying process: Real estate agents are familiar with the buying process, including the paperwork and legal requirements involved, which can make the investment process smoother and more efficient.
- Negotiation Skills: Real estate agents are skilled negotiators, which can be beneficial when negotiating an investment property’s purchase price and terms.
- Lower-Cost Basis: Hiring a real estate agent to find a potential deal and then selling it once the renovation is complete can cost a pretty penny. Unless, of course, you are a real estate agent who is doing it herself.
- Time Flexibility: Being a real estate agent is practically being self-employed. That means you have more flexibility in managing your work hours as compared to someone who works for an employer with predetermined schedule. This flexibility allows to better balance the responsibilities of being a real estate agent with responsibilities of being a real estate investor.
Because of all these reasons, I strongly believe that though real estate investors don’t necessarily have to be agents, all agents should consider being real estate investors. Based on this logic, it’s only a matter of time before women will start pursuing investment opportunities more aggressively.
Women have plenty of networking opportunities
One of the reasons that is often cited for women being under represented in real estate investing is the lack of network opportunities. I disagree with it. First of all, as we’ve already discussed, women represent the larger portion of real estate agents, giving them plenty of opportunities to network within their immediate profession.
Women are also well-represented in other real estate-related industries such the home title industry and home insurance industry. According to the U.S. Bureau of Labor Statistics women comprise almost 40% of loan officers and 35% of all licensed appraisers. Based on these numbers, women the real estate investors cannot be held back due to the lack of exposure, networking opportunities, or the industry commeraderie.
Even further, when it comes to networking, women tend to have a leg up on men. They typically excel in building relatinships. They also have strong empathy and communication skills, which can be valuable in understanding the needs of tenants, clients, and other stakeholders in real estate transactions.
Women have an eye for design
Almost 70% of interior designers are women which proves that women tend to take a lead when it comes to style. And when it comes to selling the property fast and for the top dollar, style rules.
A well-designed and stylishly renovated property can attract more potential buyers, as it creates a positive first impression and makes the property more visually appealing. It also increases the perceived value of a property, leading buyers to believe that they are getting a high-quality, desirable home for their money. Last but not least, it sets the property apart and creates an emotional connection where buyers are more likely to imagine themsevles living in the property.
The power of style is so powerful, it’s the foundation and the major appeal of the TV shows such as HGTV’s “Fixer Upper“, “Flip or Flop“, and “Love It or List It“, all of which feature formidable and style-concious women-investors.
Challeges Facing Women Who Are Real Estate Investors
Steeper learning curve of the nuts-and-bolts construction process
A successful flipper excels in at least two areas. The first is to find a property with great investment potential and put it under contract at the right price. As we discussed, women are well positioned to thrive there. The second area is to effectively manage the renovation process. This where historically women have been placed at disadvantage.
According to various sources, women comprise about 10% of the construction workforce in the United States. This includes roles such as construction managers, tradespeople, and laborers. Culturally, the construction industry is perceived as a masculine trade, partially because it often relies on heavy labor requiring strength and endurance. While it’s still true, few of our gentlemen investors handle heavy lumber or climb up to replace the roofs. They typically prefer to supervise the crews rather than joining them – something a woman-investor could do as efficiently as a man.
Still, in general women face a steeper learning curve when managing the construction process. The lack of experience always increases the risk, and women are not immune to it. However, the fact is that managing a rehab is thankfully a not rocket science, and each renovation project has a plenty to teach. Pretty soon any first-time investor that is organized, driven, and have good communication skills, will learn the ropes.
Gender Bias
Gender biases can affect women in real estate at least in two ways. It can disadvantage them in negotiations, potentially leading to less favorable terms or outcomes compared to male investors. For example, I hear from my female colleagus that they often feel that they get quoted higher prices by contractors than their male counterparts. This is also a symptom of the second bias experienced by women in real estate: perceived lack of credibility. Some males in the industry apparently think that women would not recognize an inflated quote or won’t challenge you on poor quality job.
Women have been effectively combating these biases in many industries. They are well-positioned to successfully overcome them in the construction industry as well. And many of them do. Women are slowly but surely are filling the roles and positions almost exclusively reserved for men in the past. For example, two of the last inspectors our crew worked with were women. Yes, these women came to inspect and sign off on the jobs that all-male crews – plumbers and electricians – just completed. So much for the gender bias there.
Physical safety
Concerns about physical safety can have a impact on women in real estate. Women investors may face risks when visiting properties, meeting with clients or contractors, and managing properties, especially in unfamiliar or high-risk areas. They often work alone and visit properties in various neighborhoods and conditions, which can expose them to potential risks such as theft, assault, or harassment.
By taking proactive measures and staying aware of their surroundings, women real estate investors can help mitigate safety risks and continue to succeed in their investment endeavors. Scheduling appointments during daylight hours, bringing a companion when visiting properties, using technology for safety, such as mobile apps or GPS tracking devices can help eleviate the risks and improve safety.
At New Funding Resources, we want to do our part to help women embrace the opportunities that real estate investing offers. Almost a third of our borrowers are women and this number is growig. Our private funds are here to help them create financial independence, build wealth, and leave a lasting legacy.
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