The Landlord Lens - Women in Investing

Episode Date: September 9, 2024

In this episode of Be A Better Landlord, real estate agent, and consultant Erin Spradlin sits down with Krista to discuss women in investing. 

I'm Krista and this is Erin. We're here to help you be a better landlord. So lovely to have you back today, Erin. I'm very excited to be back. So in our last episode, we talked about some investor myths and ways that new investors can work against themselves. I am so excited to chat with you today about women investing. But first, before we dive into that topic, could you tell us a little bit about your experience in real estate investing? Yeah, so I got into investing. I never saw myself as an investor, but I was in a W-2 job that I wasn't overly excited about. And at that time, I had just met my boyfriend, now husband, James, who's also my business partner. And at that time, we were ready to live together. And I had a condo that I had bought. And so when that happened, I just threw it up on Airbnb. And what's crazy is that 2014 isn't that

long ago. But at that time, people really had not, like, people were like, you're just going to put your place up and let strangers come and stay there. And it was like, well, I'm at my boyfriend's place half the time, but we're not ready, you know, for the next step. And anyways, it was gangbusters. So we just got a rental like immediately. And so because of this, we ended up arbitraging and taking on different properties and then then moving in together based off of, based off of our rentals. So when that happened, we felt like there was a real need for people to understand this new model of investing. It's no longer long term unfurnished. It's probably going to be furnished in the future. And what's crazy is not a lot of people were talking about Airbnb investments at that

time. So we really went all in on that and, you know, made our focus calling the cities and making sure that we knew exactly what the rules were and what the code read and then the best platforms to be on and how to set up. And so our niche has always been helping people with their furnished investments. And so then in 2017, both of us within a month of each other, which is just so wild. I think it was like ignorance is bliss because we just went for it and it worked out. But we quit our jobs within a month of each other, went into real estate and kind of never looked back. And then, yeah, and then I'm pretty passionate about it. I had always wanted to be a writer.

So I've now written three books on real estate investing and started a YouTube channel because I feel like that's maybe a better way to get in front of people than books. We'll see about the future reading. Like, I don't know. But anyways, so that is my investment journey. And now we have properties in Colorado and Mexico, and probably our next investment will be in the Midwest. Wow. Okay. So just expanding all over the place, building up not only your own knowledge base, but being so willing to share it with others. I got to give you some kudos there. That's really cool.

And it's just great to see women excel. I think for so long, real estate investing in particular has been very male-dominated. But also, I think there's room to talk about how female investors do it differently. What are your thoughts there? Yeah, I think sometimes female investors bristle because they don't like that qualifier. Like, I'm just an investor. I'm not a female investor. And I certainly understand that as well because at the end of the day, our money spends exactly the same.

And making something pink does not make it uniquely female, right? That's offensive. So I understand why people object to that. But the truth is men and women approach their investments differently, and they've also been trained as not necessarily the right word, but set up by society to look at it a certain way. And I think part of the reason why I got so passionate about female investing was twofold. The first time I ever went into a bigger pockets investing meeting, I literally walked in, turned right around and walked out. I found it to be a very intimidating experience. And people were just starting around terms that I had no idea.

So I felt like there was a better setup than this that could fit, you know, honestly, it could fit everyone better probably, but I made it specific for women, although men all the time ask if they can get into my female investing group. And I'm like, no, you cannot start your own group. Start your own group, please. But so that was the first thing. And then also in grad school, my final paper, my capstone paper was about how marketing does treat females differently.

And one thing that really stood out to me was that women make nine. 91% of all home buying decisions. So even though, you know, they might be attached to someone, but they make 91% of the decisions. But then when it comes to investing, they're only 25% of real estate investors. And really, the process isn't very different. So I just thought, what is happening societally that they don't have, there's a confidence gap or a psychology gap around investing. And so it's been very interesting to me. And I would say my kind of mantra or my mission with my career is to make real estate as much as I can. I mean, it's a small level, but make real estate accessible to people that don't see themselves as investors because

it was life-changing for me. And I think I could be like, I knew nothing about it and never saw myself as an investor. And so I think that could be true for a lot of people. Absolutely. And I mean, look at you now. Like you said, you have properties in different places, different countries, you're expanding. So as you examine real estate investments, how do you see men and Whitman reacting differently or acting differently. Yeah, so it's, you know, men are more apt. So men will buy younger. On average, men buy, if they're single and they're buying, they're buying at 33 and women are buying at 38. So you actually, for women, I do think it would serve them to buy younger, right? Because most of real estate is an appreciation play. And so the sooner you get into it, the better. Same as with

the stock market, right? Like, everybody knows the sooner you start investing, it's really going to show up long term and it's the same thing. So we want to see that number start to come down for women. An interesting note on that, though, is that women get qualified for loans at a younger age and a higher rate than single men do. So you should talk to a lender immediately whenever you start to think about investing because that's really going to be the first step. And then finally, I think the difference is that I think men sometimes, they're less risk adverse. And so what that looks like is they can be at Thanksgiving dinner. They hear an older relative talk about their investments and they're like, I can be an investor. I look like him. Like, let's do this. Whereas

women might need to know a friend that's done it, heard about it on a podcast, read it on a book, watch some TV programming. There needs to be a lot more exposure to females before they feel comfortable investing. So trying to shrink that up and or just think about ways that you could expose yourself to those things that might, you know, be more proactive about listening to podcasts, watching videos, finding people going to real estate meetups. I'm thinking about how am I going to make this real estate meetup work for me versus it being awkward because real estate meetups can be like all meetups. It's like networking. You don't know these people and you're like, I am herein. Please talk to me. So I, you know, I think if people are interested in that coming in with a plan,

And so if it does get awkward saying, like, do you own investments or do you have, you know, a cleaner that you recommend or what's been challenging for you, trying to actually get information out of that real estate unit? But maybe making a three to six month plan for yourself to get that information versus just thinking it's going to come to you in the ether, being more proactive will probably cut down that timeline. And we do want that timeline cut down for women. Heck, yeah, we do. Okay. So cutting down that timeline by really being purposeful about steeping yourself in the space. I love the tip about meetups. I might also add on if you're someone who gets social anxiety like me, maybe having a written list of questions that you can fall back on.

You know, some of your examples were like, do you have a recommendation for this role? Or how's the market treating you? Or even just where are you investing? What do you see as the future of this? Those are some nice open-ended questions that invite conversation and make meaningful connection. without making someone, you know, cry in the corner like, I'm like. Worst experience of my week, I hope to block it out forever. Just going to block it out for a while.

And you can also get useful information, right? So like not only are you not awkward, but you are getting useful information from that event. Absolutely. Something that I thought was really fascinating as I was digging into some of these topics were just the rates of homeownership between men and women and how that shifted over the years. Is that something you'd feel comfortable speaking to? Yeah. So I think, you know, what we're seeing is we're seeing more females, more single females

buy properties than single men. So currently where we're at is 19% for single females and 12% for single men. And then everybody else is a couple, right? But this has jumped significantly from where we were at 20 years ago. And I think what people are noticing, too, is that women are pulling ahead in perhaps in education also in home buying. And so that's another reason why I'm interested in seeing females as investors is that it's not all altruism. As my business model, right, I'm also interested in seeing this market growing.

And so if they're growing as single homeowners, are they also going to grow in the investment space? So one spot where I know I personally sometimes feel a little bit nervous and then I've heard other investors get nervous, particularly when they're women, is the negotiation process. How do you recommend women go about negotiations? and what are things that you keep top of mind when you're negotiating? Yeah, it's interesting. So I think across the board for all real estate investors, we know that it works against women, right? We know women pay more, they sell for less, and that's because they're not necessarily comfortable with having the fight.

And my advice for all real estate investors, women or men, because you see this in inspection, you see this with home buying sometimes, you want to be in a position where you can give them a little, you can take a little, like, don't dig in. That works against people more than anything else, and you don't also need to lay, like, capitulate or give in, right? So put it, put yourself in the other party in a position where you can get a little, they can get a little as you march forward. But again, digging in is a problem. And I think, you know, when I was thinking about this topic and this conversation, saying, you know, women can access, women in all investors can access courses like Christopher Voss does a master class around negotiation. He also has a really good book on it.

And so maybe it's worth your while to look at that class or study some negotiation tactics before you start your process of buying. But on the flip side, I think when we saw the lean-in movement, they encouraged a lot of people to be very aggressive with their salaries, and it backfired on some people. And we don't want to have that happen in real estate investing, too, where you've been primed and you're really excited about the negotiation, and you're like, I am not going to get steamrolled.

I'm going to make this amount. I'm not telling people, like, you should negotiate. You should get some things that you're happy with. But long term, it's going to work against you. You're better off paying $7,000 more now because you actually secured the property than to negotiate yourself to death, not get the property and then not have something to show for it for 10 years. So I think try and make little gains, but don't get, don't, don't, don't be overly focused on $1,000 here, $2,000. in their long term, it doesn't make a huge difference. And so you don't want to work against you. You want to represent yourself, but not work against yourself. And if you have a good real estate agent that's done this time or two, they can also tell you, look, I'd push here and I'd let go here. Beautiful. Okay. So what I'm hearing is remember always, especially in the real estate investment space, you know, if your plan is to hold on, you need to keep that long term picture in mind and use that as a, a place to start your negotiations while leaning on someone with more experience to help you figure out which points you can push on and which ones are better to compromise on. Is that fair to say?

Yeah, it is fair to say. And I don't want to be cavalier about a couple thousand here and there. But when it is getting financed, that's not the same as a thousand out of your pocket. And you might not feel it as much as you would having a property long term. So I just hate seeing people. I think it's understandable why people want to be competitive about their money and why they want to make smart decisions with it, but sometimes the smart decision is, you know, taking a little bit here for a long-term gain. Yes, yes, exactly. Again, that long-term gain really has to be at the forefront.

And if you're super new or you just, you feel really uncomfortable with negotiating, I could see where that would easily get kind of lost in the wash. The Yahoo finance article that I read this morning that was talking about women in negotiation was making the point, you know, they make less, they sell for less, they buy for more, etc. But maybe just buying is serving them much better than someone that comes in that's very aggressive and thinks, I'm going to get it and I'm going to get it this way. It's like until you don't get it because you have been stuck on a $500, you know, rate on fee that then knocked you out of the deal. So I don't, again, this is a conversation that we'll probably, probably society

will explore more in the future about how women's buying practices maybe do serve them in a way that we don't necessarily understand on the surface. Wonderful. Okay, so when it comes to women investing in real estate specifically, why is representation so important? Representation is important because you can have allies in the space that don't understand where you're coming from or understand why it's important to you. I see this in investing a lot. I have a friend that just passed her real estate exam and she wants to be an investor. And I was saying, get prepared for people that or trying to take advantage of you saying, this is actually how an inspection is done.

And it's like, thanks, I got it. You know, so I think that there's, we need more representation so that we're seen more as equals and as investors, not as female investors, not as a female buyer, right? But as an equal, and I think it is interesting because this conversation perhaps is counter to that, right? Like we are talking about a specific demographic

versus investors, but I think as you see more representation, that will change and it takes time, but we are moving in the right direction. Yes, absolutely. I mean, when I think back to, you know, 60 years ago when women couldn't open up accounts for the bank accounts for themselves or have a mortgage for themselves to where we are now, it's a pretty impressive jump. And I'm really excited for what the future could hold. And I agree. I think this conversation is so interesting because in part, I think we have to hone in on slices of demographics to figure out how we can boost the equity. and then finally start seeing each other as just investor, just buyer.

But until you get that boost up, there's going to be a natural socialized view where folks who have been in power, typically men, are going to say, well, this is the way it's always been and you ladies go do what you're going to do. Totally agree. But I think, you know, as a business person, let me say this. I mean, women sometimes are offended by being this subset of investors, and I get that. But I think they should say, like from my perspective, it's like, yes, you're a subset. set of investors, but you're my most important subset. You're the one that makes all the decisions

and you're the one that is most educated. We'll probably have the most money in the future. Your demographic is growing. So I am most interested in you, but not because we're both females because I recognize that you're the demographic that pulls the trigger a lot. And so I want to be in front of you. James and I used to run a business that wasn't real estate related in 2018. And we didn't even advertise to men. because it was an entertainment business, and I feel like a recreation business. And I felt like if a man sees that Facebook ad,

he's just going to tell his wife about it, right? So why are we even going, like, why not just advertise to the person that's going to pull the button, or you know, pull the trigger? And so that's what we've done. And I think when I see women as a subset, it's not, it's not like, oh, we need to talk to them a certain way. It's like, this is who's going to make the decision.

so I want to talk to the stakeholder that is going to make the decision. Yes, I love that. Let me talk to the stakeholder who's making the decision. She in general is the most important stakeholder. It's to me. Beautifully said. I really love that. Hmm.

Is there anything that you would recommend women, particularly to keep in mind as they move through perhaps long-term rentals, short-term, mid-term, whatever type of rental. I think it can be really scary to make a huge investment decision by yourself, right? Like it feels like you're walking off a cliff. And when you are partnering with someone else, it's easy to say, we made a great decision together. We made a very stupid decision together, right? Like someone else in this world thought that this was a good idea.

So I think that this plagues women more than it plagues men. It certainly plagues me more than it plagued to my husband. And so I think if this is an issue for you and you are not married or romantically involved, then it's a great idea to see if you can find a friend or a sibling or a cousin or a coworker that potentially wants to do this with you. So if you feel like partnership is an aspect that would be important to you as an investor, it certainly does not have to be your romantic partner to do that. And if you don't want the messiness of having a partner,

then you also can just get someone that you're pinging ideas against or, again, going to a meetup will be a great place to find these types of people if you can get through the initial awkwardness of it. But trying to have a mentor or someone in this space without saying, to them, will you be my mentor? There's a different way of having a mentor. And then the other thing, and we've touched on this before, but just being proactive about that decision. So I think women are great at, so I think a lot of women are very good at having a to-do list and going through it. And I think that maybe your to do list should be, I'm going to go to three meetups. I'm going to

listen to two different real estate podcasts consistently for the next three months. I am going to take a course on how to run my Excel numbers. I'm going to listen to this in negotiation. It's going to take me approximately six months. And at that point, I'm going to start talking to people or, you know, I know I'm going to be done in six months at five months. I'm going to start reaching out to real estate agents and lenders, just mapping it out so that you know exactly what you're going to do. Yes. Okay. As someone who loves a good to do list, that is so up my alley. I think getting organized and giving yourself a framework to work off of, it's so vital to getting to the point where you are now where you have lasting success. You've built up a legacy. You've got a ton to show for it,

but it didn't all come overnight. It came from being really thoughtful, doing your research, making connections, and thriving using a lot of the skills that we as women are socialized to have, right? Communication, compromise, being organized, keeping everything in line. So I think it's really interesting how that's played out. Yeah, I totally agree with that. And I think something else to keep in mind, I was just talking to someone about this was they're trying to do, I guess, Cincinnati, I want to say. Cincinnati just passed legislation that's going to allow for 80 years, which are accessory dwelling units, so like a mother-in-law suite. And I know that those can be pretty challenging to do. They take a lot longer and they're more expensive than a lot of people

think. But if you're in a market that's just allowed for that, and Denver kind of has this as well, if you're in a market that's just allowed for that, if you can learn the education and stuff on that, you might have a job for life at that point because you can teach others for how to do it. It's a very a good place to be real estate-wise. So the only reason why I mentioned that is because a lot of real estate projects require a lot of mental stamina to get through. And if you can break it down into component parts, almost like running a marathon, you don't go out and run 26 miles tomorrow. You do it over four months where you build up. And so I think if we can look at real estate investing that way too, it really serves people. And again, people that are inclined to like

project management tasks, et cetera, they're going to have an easier time getting through that long process than people that don't. Yeah, absolutely. If you'd like a good primer on ADUs, we have a video on that. We will link out to it. But really, you know, doing your homework and jumping in on some of these trends that are popping up that could last for a long time and generate extra revenue along the way. Yeah. Pretty good recipe for success, I'd say. Yeah. So one more thing that I often see pop up particularly with women who self-manage their properties is the idea of screening tenants, especially for those who are looking to house hack, which if you're unfamiliar with the term, I know you know, but if you're unfamiliar with the term, we have an episode on that

too. Check that out. Inherently, it's the idea that you are living in the residence that you're also renting out to someone new. Do you have any tips for someone who is going to house hack? Maybe they are trying to find a good tenant, but they're feeling a little bit nervous about staying safe. Yes, I have thoughts on that. I think, first off, there's an idea sometimes that tenants, there's a little bit of suspicion around tenants. And I have found people that self-property managed usually really like their tenants. Now, I've been doing it since 2017 with my husband, and we've only had one bad experience, right? And even those people were not evil.

People just, they were rough on the house, right? And so first off, I think people should approach real estate investing in self-landloring with the idea, the mentality, try and switch into the mentality that most tenants are actually going to be very similar to you and very nice, right? We hear about the ways that it goes sideways because that's a more interesting story, right? Like, I definitely gravitate more toward the story where someone trashed the place. I'm like, if someone was like, I love my tenant, they paid my bills, and then they left. Like, that's a boring story. So I think, you know, switching to the mentality of like most tenants are okay.

But I think when it comes to women, there are certain safety concerns or just annoyances that can happen. And this happens particularly in the rent by the room situation. So when you're doing a rent by the room, you're committing. to a furnished room, but you're going to have shared spaces with other tenants that have committed to their rooms. And so you might see them in the kitchen or you might be sharing a bathroom with them. And so I think sometimes that could be a little bit tricky with rent by the room because for better or worse, you know, women sometimes are subjected to comments or attention that they're not necessarily interested in. And so that's just a thought when you're sourcing tenants. And then

if you are doing a rental outside of that, I think some safety concerns for females or being on the first level, so where someone can have access to you, not allowing for pets. So you should allow for pets if you're thinking females are going to be your tenant base and you're concerned about their safety. Dogs are obviously a great alarm system and protection for females, good lighting, security cameras, smart locks, things like that. So just being aware of who your tenant pool is if you're noticing a pattern and then maybe trying to protect them. And that's not specific to women, right? I mean, you should be trying to keep all of your tenants safe. And I'm not trying to be a joke about men, but I just know I have heard about this sometimes

and rent by the room of that being an issue. And I personally have seen it when I was younger. Sure. No, I mean, I have so many thoughts. One is just that I love that you highlighted how most tenants are chill. They're good people. They're trying to do what they're trying to do, which is just live same as any landlord, right? And actually in our latest state of the rental industry report, which is a survey I send out to our landlords every other month. Landlords, by and large, really like their tenants. You know, they rated them a four out of five on average with over a thousand responses. So I see great things with the landlord tenant relationship. But as you noted, when you don't have conflict to report on, story gets kind of boring.

So there's this idea in pop culture that know these two groups, they just hate each other, and it's just vicious. You shouldn't be trying to help people out. And I just disagree with the premise. Erin, thank you again. Always love chatting with you. Where can people find you for more information, other insightful tips? Yeah, so you can find me on YouTube, but I'm under Aaron's Bradlin Rental Consulting. And then we also have a Colorado real estate podcast that comes out once a week that actually covers topics that are relevant nationwide, but then also locally. And then my primary job at this point is working with real estate investors nationwide that are looking at midterm, long term, or short term. Kind of call myself the real estate therapist, but I can be a second opinion, a neutral but informed opinion, and then also help you with your analysis on properties. but I found a lot when I was a real estate agent that worked with investors that sometimes they wanted an opinion or help handholding through their first rental or their first purchase that wasn't a very opinionated family member or their real estate agent.

So someone that's outside of the deal but has experience with it. So if that is interesting to you, my YouTube channel, Aaron's rather than rental consulting, covers a ton of that. Beautiful. So please do not miss out on Aaron's expertise. check out her YouTube channel, her podcast, and reach out if you would like to get into the investing game. Don't forget to like and subscribe. TurboTenant is the all-in-one platform for landlords to manage their rental properties. From vacancy to tenancy, we have you covered with industry-leading tools and expert advice.

Landlord better from anywhere for free at turbotenant.com.