Investing in property is no longer the man’s domain; women are becoming more active and aggressive as investors who are taking control of their financial future. It doesn't matter what state your finances are in or how old you are – it’s never too late to start planning, setting goals and taking the right steps towards achieving financial independence and security
Banks and financial institutions are increasingly recognising that women are becoming savvy about managing their finances, with several lenders now offering specific, female-oriented advice and services.
One such lender, Wizard Home Loans, recently released Her Home Ownership, a report commissioned in order to better understand the home loan and investment-related goals and motivations of Australian women.
There were several significant findings in the report, including the response from 70% of respondents that women prefer to invest in property rather than the share market or funds.
The report revealed that many women believe that the lending industry still discriminates against them today, with 38% of respondents agreeing that home loan lenders treat women differently. The most common reason cited was that lenders are hesitant in lending to them because they may stop work to have children. This could explain the finding that one in 10 women reported that they’ve delayed starting a family because of their home loan.
Her Home Ownership identified an ‘ideal home loan’ solution based on female customers’ wants and needs. “The ideal home loan for women borrowers today is inherently linked to flexibility, recognition, effective communication and service,” the report states. “While it’s important, getting a good interest rate is a given in the current competitive environment. Today, women are looking for lenders that can show a genuine understanding of, and accommodate, their shifting needs as they experience different life stages.”
Kim Kiyosaki, wife of Rich Dad, Poor Dad author Robert Kiyosaki, began her real estate investing career with the purchase of a small two-bedroom, one-bathroom house in Portland, Oregon for $45,000. Today, Kiyosaki’s real estate investment company buys, sells and manages millions of dollars worth of property.
Kiyosaki’s first novel, Rich Woman, was born out of a desire to educate and inspire women to be proactive about property investment. “Too many women, especially as we get older, are finding ourselves in dire financial straights – due to divorce, death of a spouse or simply no planning,” she says. “I wrote Rich Woman because I believe the world would be a better place if there were more rich women.”
“The book is not about how to buy car insurance or save pennies at the grocery store. I think we women are smarter than that. Rich Woman is about women taking control of our financial lives instead of crossing our fingers hoping that someone else is looking out for our financial futures.”
One of Kiyosaki’s top tips for getting ahead as a female investor is to form or join a women’s investment ‘study group’. “The problem is, so many of us have not been educated about money and investing,” she explains. By joining forces with like-minded women who are “ultimately committed to becoming financially independent”, Kiyosaki says you’ll be more focused and motivated about improving your financial situation, at the same time as increasing your access to research and resources.
Property study groups
Forming a female investors support group is exactly what a group of Sydney investors did. ‘Women in Real Estate’ is a gathering of 15 female property investors who meet on a monthly basis to share insights, research and leads.
Gabby Spencer is one the original founding members of the group and is responsible for coordinating the meetings. “We meet in each other’s homes and we have lunch. We prepare an agenda so it’s not just a chat,” Gabby says.
Often it’s Heather Lane, unarguably the leader of the group, who puts together the agenda – “She’s our guru, there’s no doubt about it,” says Gabby. Various guest speakers are also enlisted to deliver presentations, such as mortgage brokers, tax accountants, financial planners and property developers. Also, if someone goes interstate to check on a market, they’ll take the floor at the next meeting and report back.
“For the first two-and-a-half years, we had a topic every month and a guest speaker almost every month,” Heather explains. She says that their first few sessions on ‘how to research properties and markets’ yielded them 61 quality research resources. It’s through these sources, Heather says, that they tend to get leads on properties before they officially hit the market.
Currently, the guest speakers and pre-determined topics have recently been put on hold due to changing market conditions. “At the moment, this year, we’ve decided that the market is moving in a whole range of areas so we’re actively buying and sharing the information on our research,” says Heather. “It’s really been an educational program for the last three years – now everybody’s putting it into practice.”
The group has limited itself to a maximum of 15 people, and although members come and go, the majority of the current members have been there since the beginning.
Of the selection criteria when recruiting new members, their process is simple: “People who are genuinely interested in real estate join our group,” explains Heather. “I’ve had enquiries from a lot of people who wanted to join, but I didn’t think they would get much out of it.”
Their study group is comprised of only female investors with varying strategies and dissimilar portfolios. Some of the women invest in shares and property and others are wholly focused on growing their property assets, while yet another member is currently selling her property interests to focus on superannuation investments. The one factor that unites the group is their commitment to knowledge, networking and information sharing.
“We’re all sending e-mails all the time, if someone finds something very interesting in the paper, like a motorway being proposed or some major infrastructure going into a city or a town,” says Gabby.
They also monitor the markets regularly. “Right now, it’s daily,” explains Heather. “It used to be monthly over the last three years when the markets weren’t moving, but now that the markets are moving, you’ve got to be on the ball.”
Almost all members of the group are actively buying property at the moment – hot tips include Brisbane, Queanbeyan and Tweed Heads, with a general consensus to avoid Western Australia.
“We’re all individuals at different stages of our lives,” Gabby explains. “Some of us will buy and hold, some will buy and sell, some buy and renovate, and some will actually go ahead to become developers. The thing is that we’re now more confident, we’ve got the support of the group and we know where to get information.
“We’re approaching a very exciting time with our group because we’ve spent three years training – and now we’re reaching the time when we can apply all of our knowledge and put it in use,” says Gabby.
Investor Case Study
Kate Locke, 27, had “always wanted” to own property – and last year, she made that goal a reality when she purchased a two-bedroom flat at Cremorne on Sydney’s north.
“I wanted something secure behind me, so if something disastrous happened, it wouldn’t all be in stocks or something like that,” Kate explains. “The other main motivation was the amount of rent I was paying. I kept thinking ‘this is money down the drain, I could be paying off a mortgage with this’. And I think I had it in my mind that the sooner I got into the property market, the easier it would be to pay off.”
Once she made the decision to buy, Kate says that the process of researching, securing finance and finally buying a property was much less stressful than she anticipated.
“Funnily enough, it was easy! If I had known then what I know now, I might have gone into it much more relaxed,” she says. “I think the whole property market industry intimidates people, especially young people… But I think it’s just a matter of knowing what you want, keeping your head, doing your homework and being organised.”
Kate and her partner Ben spent countless weekends searching for “that elusive perfect flat”, and eventually settled on a two-bedroom unrenovated apartment close to cafes, supermarkets and shops with “gorgeous views of the city skyline and the harbour”.
“We bought the property together in both of our names, since we’re paying the remainder of the mortgage together,” Kate explains. “[but] since it was all my assets that we used to pay for the majority of the property, including the deposit, we had to enlist lawyers to draw up and sign a cohabitation agreement to protect my assets and shares in the property”.
While Kate is content with one property at the moment, she says she’s definitely keen to invest in more properties in the future. “I think that the best way to do this is going to be to upgrade to a house much further down the track, and keep the one that I own and rent it out,” Kate says. “It’s the next stage of the great Australian dream! Buying a new house and renting out the tiny little unit you used to live in. You can tell the kids ‘that’s right, Dad and I used to live in that!’ ”
Investor Case Study
Tracey Finnegan has been passionate about property for as long she can remember. “Since I was 20, I’ve always bought properties and renovated them,” Tracey says. Originally from England, where she renovated a few houses she lived in, Tracey currently owns four properties – three in Brisbane, one in Sydney – and she’s aiming to double that figure in the next 12 months.
Tracey says that research and networking are invaluable tools as a property investor. “It comes down to research – I’m glued to realestate.com.au,” Tracey says. “I get alerts online and I know that if I get an alert and ring up about it and it’s gone already, it’s a hot market.”
Last year, Tracey decided that things were moving ahead in Brisbane.
“I like the bayside areas of Brisbane, because I think with water, you can’t go wrong,” Tracey says. “I bought a property, a waterfront house on Wellington Point in Brisbane – it’s got 180 degree ocean views. The reason I bought it is because there’s just a little row of about 12 of them – the capital growth is just phenomenal on something like that. There’s no more waterfront being built, there’s a beach at the end of the point, trendy cafés and bars at the other. It’ll be worth a few bob one day. I’m getting very low yields, so I’m paying the price now, but in 10 years’ time I’ll look back and think, gee, it’s been worth it.”
Tracey then bought two new five-bedroom show houses in Cleveland, Brisbane, just two suburbs away from the Wellington Point property. “I got them for a fairly reasonable price, $440,000 each, and they got rented immediately. Basically that’s a 5% yield and I’ll do quite well in there – but that’s more of a tax write-off.”
Tracey’s proudest achievement is the house she currently lives in; she paid $750,000 for the Lane Cove property five years ago, and after extensive renovations carried out herself, it’s now worth $1.5m.
The main reason Tracey says she invests in property is the financial security it affords her family. “I’m a single parent and I basically want my kids to be financially okay. If anything happened to me, I don’t want to leave them high and dry,” Tracey says.
Her investment must-have list includes a location in a good capital growth area, preferably next to the water, with lots of infrastructure and a train station – and it has to be at the start of the market. “I wouldn’t be buying in Perth now – if I had anything in Perth, I’d be selling and popping the money into Brisbane,” she says. “I’m also looking at Tweed on the Gold Coast… I’m liking Tweed Heads, because I know it’s a hot market because I’ve been watching it for six months.”
Tracey’s strategy for investing in the future is simple. “My ultimate goal is – basically I’m not going to stop from now on. I’m going to use the equity in my home and all of my other properties to double my ownership every year. I don’t know how many houses I’ll have in 10 years’ time, but it’ll be a lot!” Tracey says. “From now on, I’ll do nothing but invest in property. I believe it’s the start of the recovery in Sydney... I’ve watched the market and I’ve seen how prices are going. I think Sydney is right at the very start. I think Brisbane has already started, but only just. It’s time to play now.”
Investor Case Study
In 2002, at age 36 and heavily pregnant, Joanna Chivers had reached a crossroads. Fed up with a long-term marketing career that involved “long hours and making lots of money for others”, Chivers made a decision. “I felt time and opportunities were passing me by,” she says. “I wanted to set up my family’s future so we could live a great lifestyle into our retirement. Superannuation and a salary job were just not going to do it… [so I] made a decision to change my life, and hence my future.”
Seven months pregnant and eager to learn, Joanna enrolled herself in an intensive property investment course. “My first investment scared the hell out of me. It was a three-bedroom unit in Narrabeen bought off-the-plan that cost twice as much as our five-bedroom house in Curl Curl purchased a few years prior,” Joanna says.
The apartment was part of a small, boutique development of only four properties, located in a flow-on beach suburb that hadn’t yet boomed. “It was lakefront, it had beautiful water views, and everything stacked up,” Joanna says. After researching for more than six weeks, she purchased the property for $687,000.
In 12 months, the property had increased in value by $150,000. “My annual salary was about half this amount at the time and I thought, why work ridiculously long hours for two years when I can make the same amount from one property deal?” Joanna explains.
Since that initial purchase, Joanna continued to invest. And now, five years later, her personal property portfolio includes six properties valued at around $3m.
She’s also since launched her own property investment business, Property Bloom, where Joanna acts as a developer and project manager, sourcing suitable properties in the Hunter Valley region on behalf of clients for re-development into a house plus a duplex.
Joanna guides the project from start to finish – the client can be as involved or uninvolved as they wish – resulting in three investment properties that are generally cash-flow positive, with roughly $70,000 created in equity upon project completion. The total client investment is approximately $550,000, with around $100,000 of that to be accessible equity or cash, with the remainder borrowed.
“I base my fee on the profit or equity we can create in their development – so my incentive is to do everything as quickly as possible and get the best possible result for my clients,” Joanna explains. Since its inception five years ago, the business has managed developments valued at over $9m.
Joanna says she has the flexibility to structure her work around family commitments, which leaves plenty of time for her energetic five-year-old son, Tremayne. “It’s amazing what you can create when you’re ready for a change,” she says. “I needed to have more time for my family, and the best part is that I love what I do,\ and I have a more balanced lifestyle.”
Investor Case Study
Although Rhonda Trollope is relatively new to the property game, she’s no stranger to investing. “I initially invested in shares because I could invest with a small amount of money and learn as I went along,” Rhonda explains. “I’d buy shares, learn a little bit more, study and research a little more, then buy more shares.”
Rhonda says that while she always “loved properties”, it wasn’t until she met property investor Heather Lane – at a craft day for their children’s school fete – that she became serious about exploring property investment. “Heather always spoke about properties,” Rhonda says, “and I’ve always thought property was a good investment because it’s tangible and because I love everything else about it. But it’s a whole lot more expensive than shares!”
Before long, Rhonda, Heather and a group of other property enthusiasts had formed a study group. “I was right in my element because I’d realised by this stage that there were cycles and while my shares hadn’t done well for a couple of years, they were then starting to boom, and it all fell into place,” Rhonda says. “There’s this cycle where shares go up, shares go down, property goes up, property goes down – but you could actually have quite a nice balance there, when the property goes down you could go into shares. So it just seemed natural that the two went together.”
In 2005, Rhonda bought her first investment property at Bundall on the Gold Coast. “It’s not a holiday let – I have someone in there 365 days a year paying rent and we’ve done quite well with that in just that short period of time,” Rhonda says.
Since that purchase, Rhonda says she has had “a period of time where we’ve been just doing lots of learning about property,” she says, “and now is the time to buy – now I’m ready to go. I’ve been researching Brisbane and I’ll be heading up there and buying shortly... that works well with the superannuation fund, as we’re building that up.”
When assessing potential investments, Rhonda says she looks for properties that are well-positioned and centrally located. “Also, something that sort of has an edge over other properties – like our property in Bundall is on the canal and near the corporate centre. They have rental waiting lists, and always have had within the complex, so that’s ideal, as it’s something that I can rent easily.”
While she would consider buying in her hometown of Sydney in the next six to 12 months, Rhonda says that being physically near the investment is not a priority. “I can see the advantage of having your investment close by… but when you consider land tax and a whole lot of other issues, I just see Brisbane as being growth and I think that’s where I want to go,” Rhonda says.
Her Gold Coast property is a secure complex within a gated community with a full-time, on-site manager. “It’s worked really well because the on-site manager deals with everything – maintenance, any problems that the tenants have, it’s all taken care of. I don’t have an agent ringing and bothering me all the time. So a gated estate with a manager on-site works well for us. We’ll probably look for this in future investments as it’s worked so well.”