Real estate has been traditionally looked at as the domain of men while a woman’s place has been thought to be the ‘kitchen’. However, the concept of “boldness” is really about an attitude of confidence in one’s ability to take correct action leading to a determined outcome. For women to invest in real estate, it’s important for them to recognise the importance of this asset class as a wealth creation tool which can accelerate their quest for financial independence.
Women investing boldly in real estate
Nigerian women are already making strides in this area in spite of numerous cultural challenges. It’s however important that women become more astute about investing in real estate whether it’s our basic housing needs, or other types of real estate. Women have been in the forefront of maintaining their primary residences. A starting point therefore would be that more women become more engaged and educated about their primary residences, asking questions to ensure they understand the dynamics about the acquisition, preservation and optimisation of their properties. If more women recognise how important the roofs over their heads are, they’ll not leave it solely to their spouses. Some women have ended up in unfortunate circumstances as a result of decisions made by their spouses. Beyond the primary residence, women should seek to become landlords or investors in different forms of real estate. There’s nothing that legally stops us from making bold investments besides the mind-set and a lack of knowledge.
For some women, the reason they hardly make informed decisions to invest is the lack of adequate knowledge. It’s important to know your starting point. If you do not know where you are, it’s much more difficult to get direction to a desired destination. Doing a 360 assessment of your current finances and wealth profile will help you determine how and what you can invest. It’s important to be true to yourself as this helps you recognise your real situation and enables you adapt a correct strategy. For an investment strategy to be useful, it has to be tied to specific purpose. Are you a single, married, monogamous or even in a polygamous relationship? Is this a personal, family or business investment? Is it long term or short term? Is it for cash flow or capital gains? Is it to be used to hedge against inflation, as a store of value, for retirement or savings for school fees or to invest in something major in future? Your starting point and your destination are two critical elements when choosing to invest.
As a lawyer and Wealth advisor, I’ve found many women unfortunately clueless about some of the basic dynamics of their personal finances. In addition, women tend to be naive and maybe embarrassed to address their real financial situation. It’s important as women to become more financially savvy, to ask bold questions about our family finances, take stock of the real estate portfolio of our families, understand their current status and have access to the most important information about the assets.
The choice to invest is yours; no holds-barred!
Legally, there are no restrictions preventing any Nigerian woman from investing in real estate. The Land Use Act is universally applicable irrespective of gender. Section 43 of the Nigerian Constitution guarantees right to acquire property anywhere in Nigeria.
Some of the challenges however that arise with investing boldly in real estate include culture and tradition that stifles a woman’s sense of confidence in investing in real estate, with fears of appearing to be too masculine, or too independent. Many women invest in secret, thereby losing confidence, or running the risk of not going through the proper due process with unprofessional agents who may even take advantage of their secrecy. Some questions such as inheritance and tax planning also arise with many not having sophisticated advice on how to structure their investment especially in a society where women owning significant investments is still frowned upon.
The reality though is that an increasing number of empowered women are now operating between the kitchen table and the boardroom, and this trend is here to stay. Many successful men and women today were trained by mothers who invested in the real estate and profited from such assets to train their children whether at the demise of their husband or separation or during a dire financial situation.
Women must not allow their environment or the society they live in limit their capacity to invest in real estate. There must be advocacy against any societal or cultural practices that limit or hinder women from investing in real estate because many of us can relate with the fact that mothers have raised or contributed to raising children who are today success stories. This would not have been possible if these women did not have solid financial footing mostly through entrepreneurship and real estate investments. Women need to recognise that if the society will not take responsibility for caring and raising your children, why should the society limit you from investing in something that helps you build a financial base especially as women tend to outlive their spouses and in an environment where polygamy is culturally accepted, it brings with it challenges. The bottom line is that women need to become bolder and more savvy about real estate investments through education, research and connecting with networks that help them become financially empowered. They need to also engage their spouses in bold conversations about their real estate and other investments in a none threatening and value adding manner.
The capital challenge
In terms of accessing financing, banks and financial institutions are increasingly recognising that female entrepreneurs in particular, offer an emerging opportunity, and are providing financial products targeted at women. Most of the products are, however, ill-conceived or mismatched to the reality of most entrepreneurial or professional women. In addition, the cost of financing remains a major source of discouragement for women who generally tend to be more conservative. There is definitely a need for property developers and financiers to get more creative to tap into the ingenuity, and commitment of an increasing army of women who are rising up in the market place.
The work place is also a great place to start your real estate journey from as several opportunities have been made available today by some forward looking organisations. Such organisations have provided convenient payment plans for acquiring real estate through their cooperative societies. This is a great way to begin your real estate investing journey. Organisations should look into creating opportunities through their cooperative societies as this would have taken care of a lot of work, like due diligence, that would have been done individually.
Joint ownership is another way of acquiring real estate. A group of women can invest in real estate together as long as you scrutinise every word in your contract but don’t hesitate to sign off once you’ve clarified and feel confident to proceed. Get professional help if you are not familiar with the contract. Investing in a Real Estate Investment Trust (REIT) could be another regular income streams and diversification avenue that can guarantee capital appreciation over the long term. The important thing about investing in real estate as with any other investment is a commitment to start.
The growing active women investor class
We have witnessed first-hand a growing trend of women climbing and staying firmly on the real estate ladder. Interestingly, a recent Fine and Country survey showed that more women are actively investing in real estate as an asset class, with approximately 30% of its clients in the residential investment category at the mid-premium price range, being female entrepreneurs and professionals/executives. Women are becoming bolder in venturing into real estate. They are now more deliberate and are taking bolder steps for change.
Women in the retail chain business, ranging from pharmaceuticals, accessories to beauty and skincare should borrow a leaf from the McDonalds’ real estate business model. McDonalds isn’t really purely the burger-flipping restaurant chain. Peel back the layers and you’ll find that the corporate entity is actually a real estate company. Harry Sonneborn, a former McDonalds’ CFO once said, “We are not technically in the food business. We are in the real estate business. The only reason we sell fifteen-cent hamburgers is because they are the greatest producer of revenue, from which our tenants can pay us our rent.” Women in the retail chain must begin to use this model to create wealth for themselves through real estate. They can begin to own the properties where their stores are located and rent out part of the spaces to other tenants.
Key factors to consider before investing
I am a firm believer in principles because I have seen the impact of principles on my own life, in business and investments. It is also common knowledge that the simpler the principles are, the better and easier they are to apply. ‘’The A-Z of Creating Real Estate Wealth for Women’’, a book I wrote and currently expanding, quite frankly, captures and explains the concepts, secrets and strategies, of investing in real estate in a very relatable way.
Below is a quick outline of 5 keys that have been helpful both personally and to everyone that have applied them.
Belief and desire: It doesn’t matter what state your finances are in or how old you are- it is never too late to start planning, setting goals and taking the right steps towards achieving financial independence and security through real estate. Most of the limitations I have found are mainly in the minds of women.
Knowledge: all types of investment require knowledge. The more knowledgeable you are about the opportunities that exist and understanding the risks, and how to mitigate them, the higher the likelihood of success. Lack of financial knowledge is a stumbling block. An inability to interpret the market will affect your success. Be aware of the economic indicators and get clued-up through seminars like the Finer Wealth Series organised for women by Fine and Country West Africa, reading the news, researching, joining investment clubs, etc.
Confidence: Access to the right information, as earlier mentioned, increases confidence. Confidence prevents women from being bound by analysis paralysis, or knee jerk response to fly-by-night opportunity. Caution is critical in real estate investment. However, fear that leads to paralysis will affect your success in all areas of investment and curtail your financial future.
Women should gain confidence also by realising that they bring a unique eye to real estate, and naturally tend to add significant value as a result of our affinity for enhancing and upgrading things.
Financial discipline: This appears to be the most critical element of success. Real estate is generally a mid to long term play, and financial discipline requires investors to not only save for a rainy day, but sometimes, sacrifice a brighter future, an area that many women find challenging. In addition, as traditional nurturers, many women tend to put others needs ahead of theirs. Many give up financial nest eggs for the privilege of helping desperate spouses, children and relatives without realising how this impacts their long term emotional and financial wellbeing. Balance is required.
Market intelligence, due diligence, title, negotiation, location, personal preferences, etc. are other areas women need to be mindful of when investing in real estate.
Self-help resources for women
There are quite a few resources available for women to take advantage of. There are seminars where women are taught specifics on wealth creation. Fine and Country West Africa has designed a programme, ‘’Finer Wealth Series’’, tailored strictly for women with appetite for investing in real estate. There are numerous resources that could be found on the internet that could help with investing intelligently in real estate. There are a few women who have distinguished themselves locally in training and educating women on wealth management and creation. Money Matters with Nimi and Smart Money with Arese are fantastic opportunities for women to learn financial planning and discipline along with the books authored by these respective women. Women should take advantage of these avenues so they can become savvier financially and more astute real estate investors. Successful female investors tend to network actively with other successful investors through work or other opportunities, including female-run investments clubs which tie in with their own investment ethos and appetite. Such groups can provide them with crucial opportunities for networking, education and support, where confidence is lacking.
Udo Okonjo is the CEO/Vice Chair of Fine and Country W.A. She is a distinguished Chevening Scholar and also a member of the Oxford Real Estate Society.