Real Estate Investing

Lisa Moren Bromma is a real estate investor of nearly 30 years, a national speaker, business consultant and sits on the board of directors for the National Real Estate Investors Association. She has authored several books, including Real Estate Investing for the Utterly Confused, and most recently, Wise Women Invest in Real Estate. Here, she shares her experience with real estate investing and offers advice for women interested in joining the field:

What gave you courage in the beginning to invest in real estate?

1978 – I bought a 1,900-square-foot house in Pinellas Park, Florida. The real estate broker carried the note for me, because at that time interest rates were at 18 percent. I sold it five years later and it appreciated, so I bought another house, and from there bought more than one. I was a single mom with two kids and I viewed real estate as a savings vehicle.

Is this a viable income option for single women and mothers?

The market is made up a lot more these days of single women buying property. I would say yes, depending on their time constraints. It’s about four things: income, cash flow, appreciation and taxes. There is no cookie cutter, magic wand approach to real estate investing any more. It’s a business and you need to run it as a business and look at it as a diversification of your portfolio. You need to hire a property manager or be willing to do the work, which can be done on the weekends. I hold open houses for my rental properties on Sundays. It’s a very easy way of renting property.

Is it better to flip houses or just rent them?

It’s definitely not better to flip houses. If you’re buying property right now, you’re buying it to hold it. You should not have to pay anywhere near the asking price, and you should be prepared to hold it. I’m talking about markets that have really suffered, like Florida, where builders have overbuilt. I’m not talking about Hot Springs, Arkansas, which is actually doing quite well. It depends on your investment strategy – is this something you want to have in your portfolio long-term or do you want immediate gratification? It’s an individual question. I tend to always go for the long-term.

How do women handle not-so-pretty aspects of renting property like collecting overdue rent and possibly evicting?

That’s a whole course. That’s a whole hour-long conversation. To put it shortly, they have to screen the tenants to put the right tenants in place. Homeowners’ associations are starting to get in on the act, so if you’ve got a tenant who’s not taking care of the property, you as a landlord can be held responsible. You’ve got to oversee your tenants, and that takes work. It’s much more work-intensive than it’s been, which is why some people may opt to go with property managers.

Why do you say women are inherently good property investors?

I believe women listen much better than men. They can empathize with the seller’s motivation, which is especially important right now with the way the market is. I think women do an excellent job in being able to plan. The women I work with seem to be much more proactive in planning. You do need to plan, especially now. It’s vital to your financial life, because otherwise you won’t succeed.

Any special considerations for women investing in real estate?

I would recommend women be very comfortable dealing with certain types of people – bankers, realtors, contractors, insurance agents, CPAs and a property manager if you’re not managing your own. I call it their team of advisors. By putting these people in place, women are saving themselves a whole lot of hassle.

What is your top tip for women getting into property investing?

Women should not be afraid to ask the seller if they would be willing to carry some part of the financing. But the number one tip I would give to women is to know their market, know how many houses are for sale and for rent so they know what they’re up against. They can get a lot of that information from Zillow.com. Secondly, I would tell them to know where they’re going to get the money before they start.