Chicks and Mortar - A Woman's Guide to Investing in Property

Chapter 1

Getting started

Why invest in property?

“ I worked full time in a small company and only received a nominal 10% pay rise every year. By chance, one day I discovered that my male co-worker was receiving anywhere up to 40% pay rises compared to my 10%. We started on the same pay rate and did the same job. It was a huge wake-up call for me and I realised that working hard in a job was just not going to get me where I wanted to be anytime soon. If I was going to reach my goal of retiring early, I needed to start working smarter and not harder.” KYLIE

The reason behind deciding to invest in property will be different for everyone. Some women just want the security of owning their own property, while other women will want to build a portfolio to create great wealth. Regardless of the reason, the underlying desire will be to improve your circumstances.

Pay inequality is a factor that affects women even today. Just like Kylie, quoted above, women earn approximately 10% to 20% less than men, even if they have the same qualifications and work in exactly the same positions. This discrepancy is evident from the moment they enter the workforce.

The statistics don’t lie. Women are at a disadvantage, not only with regard to wages but also when it comes to retirement funds. The reality is that women have approximately half the superannuation in their accounts at retirement than their male counterparts. Women are also more likely to have gaps in their careers while they take time off to have a family and raise children. Women are then more likely to return to the workforce in a part-time capacity. These circumstances have an impact on their superannuation and their retirement.

It is simply not enough to rely on superannuation or an old age pension to fund your retirement. Let’s face it, depending on your age, there may not even be an old age pension waiting for you. And looking at the elderly today who are on the pension, they’re certainly not living the high life with lots of cash to spare.

For me, personally, I love property. I love being able to physically see it, touch it, smell it, hug it ... OK, OK, I am property crazy! But I also appreciate the security that property brings and the comfort in knowing that I have a financial plan in place for my future. Property brings me security.

There are many reasons why women choose property investing over shares or saving in cash management accounts, or leaving money on term deposit. Property is often perceived as a lower risk investment than shares because it is a tangible asset. You can take physical stock of it and you are more easily able to alter it (and add value). Property investing also has an, arguably, smaller learning curve compared to shares.

As for cash investments, when interest rates are low (as they are at the time of writing this book) the returns just do not match those possible from property investing.

I decided to write this book to give women an overview of how property investing works. It takes you through the stages and processes required to buy property and build a property portfolio. It covers the initial steps involved in working through your goals and creating both a financial plan and a property plan. From there, the book guides you through applying for finance, finding a property and the management of that property.

Why women do it better

Chicks and Mortar – A woman’s guide to investing in property has been written to empower women, to give them confidence to start investing in property or continue to invest better with new-found knowledge.

Women have many, many qualities that are often overlooked or undervalued that, when harnessed, can provide them with an edge. Let’s remind ourselves here why women make better property investors (well we think so, anyway).

Women are intuitive

Women are in tune with their emotions and internal risk meter. Women are more likely to intuitively feel if something doesn’t quite seem right and either not proceed or proceed with great caution. This natural intuition gives women a great advantage when they are researching an investment property and before too long they can quickly gauge whether a deal is the right one or if they shouldn’t proceed. Perhaps they just need to do a bit more research on the deal or ask a few more questions in order to decide.

Women are practical

Let’s face it, when it comes to being practical, women are naturals. We are methodical in our thinking and, when faced with an obstacle or barrier, we are more determined to find ways around the barrier to keep moving forward. Being practical in property investing is without a doubt one of the best skills to have. You will often find that if you just look at and deal with a situation practically it will run a whole lot smoother and you can easily achieve the desired outcome.

Women are logical

Have you ever heard the expression: ‘Have a woman’s look’? Have you often had to have a ‘woman’s look’ when your male counterpart has been unable to find something? When it comes to thinking, women can look at situations in a rational and logical way. If we don’t know information or the answers, we will ask and continue to ask until we get the answers we are seeking. Research shows that women are more likely to seek advice and ask questions than men and, when it comes to investing, women will forecast their finances further into the future than men.

Women are conservative

Women are more conservative when it comes to investing. They are more risk averse and research shows they will seek a lower return on their investments and do deals less frequently. Women are less likely to proceed with an investment if there are too many unknowns; and therefore they will research better.

Women are smart at making their money go further

There is no denying the fact that women have less money. They earn less money and, because they live longer, that money needs to be spread further. Their income fluctuates throughout their lives, as they take time out to have children, or care for aging parents. But, while women have less money, they are more likely to make the money last longer than men, and they distribute their money more appropriately.

So, if women hold all these great skills, then why are we not leading the way in investing and finances? Why aren’t more women out there succeeding in wealth creation?

What’s stopping you?

Well, apart from the obvious reasons, including lack of time, lack of resources, and lack of money, the biggest reason I have found for women not starting to invest, from talking to many, many, smart, intelligent women, is confidence.

Building your confidence

Confidence is the one main factor that is holding a lot of women back. Women have less confidence in their own abilities and often downplay or even deny the achievements they have made and the knowledge they have. How can this be addressed?

So often, I meet women who are very well educated in property investing, they have even gone as far as perhaps purchasing one property, but then continue taking the slowly, slowly approach. Unfortunately, the slowly, slowly approach can be so slow that they do not actually move forward at all, or they move at such a slow rate that you don’t even notice it.

Don’t get me wrong, there is no problem with going slowly. We all need to be comfortable with our own decisions and actions. But you need to be aware of whether you are taking the slowly, slowly approach because that is your normal way of doing things, or because there is something else holding you back. You might really want to move forward, but there is something stopping you. Don’t get stuck doing this dance. Assess where you are at and what is actually holding you back.

One reason for lack of confidence is making comparisons. Remember, this is your personal journey and no one else’s, so there is no point in comparing your journey to those of others. In fact, comparing your property journey with someone else’s is the fastest way to confusion, stress, and, most likely, failure. By all means, watch what others are doing, ask questions, ask for advice, and, if you are comfortable and confident following a similar path, then that’s great. You have done the research and have made an informed decision that this is the path you want to take. But don’t just see someone’s success and think you can do the same without reviewing your own situation and asking yourself if this is the best path for you. This book will cover all the steps you need to work out your own path.

Further things that could be holding you back are common among many women and could include:

Lack of education and experience

Lack of education is a common reason blocking people from doing numerous things. You don’t know what you don’t know and, more often than not, you have built up a perception in your head about what it will be like, how far you will get, and how you will feel. (Most of the time, when we feel we have a lack of education, we have a deep-set fear of appearing stupid to others.) You will be surprised how many people feel like this. Even those who appear to know it all, or actually have an abundance of knowledge, feel as if they don’t. The main thing is to have the confidence to educate yourself and gain the knowledge and experience you need to progress.

Lack of education and lack...