Despite considerable pressures on the market, investing in property in the UK is still a pretty good way to make money. And more and more women are using it as their means to gain financial independence.
Women now make up 40% of UK landlords – and it’s important to put that in context. Women only make up 17% of small business owners, and just a generation ago they could still be asked for a male guarantor before they could get a mortgage. That’s pretty meteoric rise.
So why are women winning at property, and how could you do the same?
I strongly believe that property is a great opportunity for women because it gives them choices. And women are great for the property market because they make different choices for different reasons than their male counterparts.
Research from Simple Landlords Insurance shows that women are more likely than their male counterparts to be accidental landlords than deliberate investors (48% deliberate investors compared to 61% of men) – but that doesn’t mean they are less committed or less professional. In fact they are more likely to have properties they’d be prepared to live in themselves (47% vs 39% of men), are more likely to place importance on building strong relationships with tenants. They are also more likely rent to different tenant types (for instance 35% would rent to people on benefits compared to 25% of men).
What’s more, the female landlords are proud of these differences. They are proud to be open-minded, proud to support social housing, proud to be house-proud, and proud of their relationships with tenants. Their differences are their edge.
How to get started
I believe financial independence for women is absolutely crucial. We cannot take our relationships, our careers or our families for granted. I became a landlord by accident, renting out rooms in my home after my marriage broke down, trying to make ends meet for me and my infant daughter.
Now I’m a deliberate investor, with a multi-million pound portfolio – and I help others follow the same journey.
I think women can bring something different to property, and I believe that If I can do it – part-time and as a single mum – so can you.
1. Think about your skills
I see many women who have ‘hidden’ skills that can be applied to property investment more easily than they think. For instance, women often fall into being the family organisers, and keeping a lot of balls in the air – all vital skills for property investment. So is being a good communicator, a good negotiator – and being good at managing people and projects.
2. Know what you want
Are you investing for long term capital growth – a pension? Or are you looking – like 63% of female investors – to boost your monthly income? Do you love your job? Or are you looking to use your investments to replace your salary? What kind of lifestyle do you want? How much is that going to cost you each month? How involved do you want to be with your investments? How much time are you looking to free up for your own hobbies, your family, your other commitments?
3. Be clear on your strategy
Once you know what you want, it’s time to think about how you build your strategy accordingly. This is where you decide where, how, and when to invest, and put together a step by step investment plan. What type of property is going to meet your needs? What type of tenant? Are you, for instance, going to set up a Ltd company? It’s an option many landlords are considering with changes in landlord tax, but will it work for you?
4. Get your finances in place
You need to know exactly how much money you’ve got to play with, and how to get more. Can you get a mortgage? Can you remortgage? Can you get a loan – at what APR? Can you crowd-fund? Be realistic and run and re-run your numbers. Make sure the figures stack up against your investment plan, include tax and insurance premiums in your sums, and budget for unexpected costs.
5. Do your research
You can never do too much research. Take the time to look at your area, the schools, the amenities, similar properties, average rental incomes and tenant types. Talk to the council, and find out about building plans and regulations. Research, research and research some more.
6. Get a good team around you
It’s important to surround yourself with the right, knowledgeable experts up front. You’re going to need a lawyer, a skilled accountant, a good letting agent, plus good information on the local housing market, the right mortgage if you need one, and the right insurance too. Down the line you’re also going to need a builder, an electrician and a plumber you trust. Start building your networks now.
7. Get some support
One of the biggest mistakes I made when I started out was to try and go it alone. There is help and there are resources out there to help you, and help you think differently about your investment. Have I covered all the angles? What haven’t I thought of? What else could I try? That’s why I created a network called the Female Property Alliance where like minded women from all over the country network with each other, where they feel heard, supported and guided.
8. Choose the right tenants
Your tenants can make or break your investment. Think hard about local demand, who you want to rent to, what they’re looking for in a property, how long they’ll want to stay, how much they’re looking to pay, and any potential risks you’ll need to insure for. Always run your own detailed references so you know your tenant’s background, renting history, and ability to pay the bills.
Having said that, I have always treated my tenants as customers who deserve excellent accommodation and service, and I have found this rewarding both ethically and financially. I want them to make it their homes and stay for longer and care about and look after the properties themselves.
9. Set up your systems
Get organised and set your systems up so you’re ready to extend your portfolio. You’re going to need to have contact details for agents, suppliers and tenants, rent accounts, references, details and alerts for when maintenance checks are due, when policies run out, inventories and inspection notes. Getting everything set up at the very beginning for your first property means everything is in place for your second, third and fourth property – and beyond.
10. Get the right insurance
If you don’t have the right insurance in place you can kiss goodbye to your investment. It’s vital you get specialist landlord insurance, and that you know exactly what you’re covered for and what you’re not. In this case, smaller isn’t necessarily better.
Remember, this isn’t about property, it’s about lifestyle. Property is the vehicle to get you where you want to go in life.
Financial independence is within your reach – you just have to make a start.
Founder, Female Property Alliance
Director, Smart Core Wealth
Consultant, Simple Landlords Insurance