Following the official launch of PropElle, the women-centric network for property investment, founder Ayesha Ofori tells Property Investor Today what it means to be a woman in the world of property and how women can gain financial freedom via bricks and mortar.
Let’s be honest: property investment is often considered the remit of the ‘pale male’. More than 100 years ago, property ownership was just a pipe dream for many women. Until the late 1800s, women couldn’t own property - they were the property of their husbands. As recently as the 1970s, women were regularly refused mortgages if they did not have their husband’s permission.
Thankfully, things have progressed since then. Women are now engaging in property investment, but a lot more needs to be done to tip the balance of the scales closer to equality. We need to educate women about the opportunities available to them through property investment.
The first thing that most women ask me when I meet them is ‘why property?’ The answer is simple: bricks and mortar is one of the safest investments available, offering good returns over the long term. Even better news: over the past 10 years, returns on property investments (when leverage is included) have been greater than other asset classes, such as stocks and shares.
Additionally, owning a tangible asset like property is often preferable to an investment you can’t see or touch. It can also be low maintenance (if you hire a property manager): many property investors do little to no physical ‘work’ on their properties, which means that their investments are making money while they sleep. This is ideal for many women who work full or part-time in addition to taking care of a family.
Armed with these facts, it’s shocking that more women haven’t looked to property investment. I think this is largely due to a lack of knowledge/education, a lack of belief in their ability to make a success of it and the false notion that it takes a fortune to get started.
There are, of course, some property investment strategies which do require a fair bit of upfront capital, e.g. HMOs (houses in multiple occupation). I think HMOs are a great property investment strategy, but they do require a relatively large cash balance to get started.
But it doesn’t have to be your cash; the investment capital needed could come from a joint-venture (JV) partner. That’s someone who has the money and wants to 'invest'. Not all property strategies require large sums. With newer options like property crowdfunding and real estate investment trusts (REIT), women can earn some pretty decent returns, with investments as small as £500.
What’s needed is a holistic financial re-education process. We need to change the conversations that we as women have about money. So often, I hear clients tell me that they’ve been raised to think that debt is a bad thing. That couldn’t be further from the truth, especially with property investment.
Think about it: if you purchase a property with debt (a mortgage) rather than buying outright in cash, as the value of the property increases, your return on your cash invested is higher than it would otherwise be, due to the leverage used.
For example, if you buy a house in cash for £100 and it increases in value to £150, you’ve made a 50% return of £50. If, however, you bought the same house with a £70 mortgage and £30 cash, your return, after paying off the mortgage is £80 – a 266% return on your initial £30 investment. This is the power of leverage – the power of debt. But, debt must be used sensibly and you shouldn’t take on more debt than you can afford to repay.
This re-education process is why I chose to found my property investment community, the PropElle Network. PropElle offers women of all backgrounds the opportunities they need to achieve their dreams through property investment.
We focus on educating all women, no matter their goals. One of my favourite parts about my job is speaking to different women. For some, the aim is to have more disposable income, for others, it’s a means of savings that offers attractive returns. Others are hoping to achieve financial freedom to chase their dreams unencumbered by a 9-5. Or, for those already in property or building their own property portfolio, it’s a way to scale and grow their businesses. The common theme is that for everyone, it’s about building their dreams… one brick at a time.
The property industry will only achieve change through education. By arming women with the tools they need to achieve financial independence, we can open up a world of opportunity.
*Ayesha Ofori is a property expert, entrepreneur and founder of the PropElle Network.
This is part of an ongoing series focusing on women in property investment.