Barbara Corcoran's Life Changing Real Estate Investing Advice

Barbara Corkran says investing in real estate is the easiest way to get very, very rich. She became extremely wealthy due to not only a successful career in real estate sales but also investing in property herself over many years. With an estimated net worth surpassing $100 million, she shares her advice for the average person looking to build substantial wealth with real estate. Let's take a look at exactly why she believes real estate is an incredible investment in her surprising advice to others looking to get rich.

Barbara Corkran is a successful American businesswoman, investor, speaker, consultant, and television personality. She's perhaps best known for her role as one of the Sharks on the TV show Shark Tank, where aspiring entrepreneurs pitch their business ideas to a panel of investors, including Corkran, in hopes of securing funding. Before her TV career, Corkran founded the Corkran Group, a real estate brokerage firm, in 1973. She started the business with a $1,000 loan and built it into one of the largest and most successful real estate companies in New York City. In 2001, she sold the Corkran Group for $66 million.

One of the best things about purchasing property, according to Corkran, which could be a double-edged sword, is that your money is safely secured in an investment that can't be easily or quickly tapped. Investing in property offers the advantage of securely tying up your funds in a tangible asset, shielding them from impulsive withdrawals and market volatility. This lack of immediate liquidity forces discipline and long-term investing, reducing the likelihood of succumbing to short-term market fluctuations and promoting steady growth over time. Since there's no way to determine the exact value of a piece of property without selling it, owners are unlikely to notice short-term fluctuations in market price, further adding to a long-term mindset. The illiquidity of property can pose challenges, as accessing funds can be cumbersome and market fluctuations might impact the value of the investment. As long as you can pay the bills on the property, the value of your investment can grow year after year with a lesser temptation to sell than stocks or other assets that can easily be sold with a few swipes of the fingertips.

Nearly everyone has encountered someone who once owned a home, sold it, and later regretted it upon seeing its value after a little bit of time. The common response in such situations is often, "Wow, I should have kept that house."

Barbara Corkran has been in the real estate market for a long time, and she's seen major price increases through various markets. She knows that when investing in real estate, you can bet on the value of the property increasing over time.

In certain circumstances, is a home value guaranteed to rise in value? Of course not. After all, nothing is guaranteed when it comes to investing. But by taking a look at home prices over the decades, we can see that they just about always rise over an extended time.

Property values tend to rise across the board, provided you're not in a terrible neighborhood. But to ensure reliable and higher-than-average appreciation, you need to invest in growing, high-quality markets.

While cash flow is another benefit of owning real estate, property appreciation is usually where you're going to make the most of your money.

From the monthly mortgage payments and insurance premiums to property taxes, maintenance costs, and repairs, rental income can fit the bill for it all in many cases, further sweetening the deal. If you play your cards right and manage the property efficiently, you might find yourself with some extra cash in hand after all the necessary expenses are covered.

This surplus is what we call cash flow, the icing on the cake, so to speak. It's the additional income that you can pocket or reinvest back into the property, further boosting its value and potential for long-term financial gain.

Not only does rental income help you break even, but it also has the potential to pad your wallet and enhance the overall profitability of your investment.

Corkran recommends purchasing the most affordable multifamily property in a desirable rental area and implementing a tactic known as house hacking. With this approach, you can live in one of the units while renting out the others to cover a significant portion, if not all, of your monthly expenses.

By taking advantage of this method, you effectively minimize what would normally be your largest monthly expense while also entering the real estate market as an investor. Once you've established the property, gained some equity, brought the units up to standards to maximize the rental potential and desirability, and rented each unit out, you can move out of the unit you were occupying and rent that one out. This step allows you to repeat the process, essentially creating a cycle of investing and accumulating properties and providing high-quality housing.

A huge advantage of house hacking is the ability to enter the real estate market with a much smaller down payment than typically required for traditional rental property. This lower initial investment not only reduces your financial risk but also opens up opportunities for individuals with limited capital to begin investing in real estate.

With rising property prices, Corkran advises young adults to get in the game as early as possible. When it comes to investing, you want to begin as soon as you can. As the saying goes, "Don't wait to buy real estate; buy real estate and wait."

By purchasing property as soon as possible, investors can allow the many growing factors to work in their favor. As the years roll by, your mortgage gets chipped away, building up your equity. Plus, properties tend to gain value over time, adding another layer of financial security. And let's not forget about those rising rents; they mean more cash in your pocket. These factors all work together to provide compounded gains.

Countless excuses might tempt you to put off diving into the market. Maybe the economy feels unstable, interest rates seem dauntingly high, or property prices are through the roof. Add in worries about inflation, and uncertainty about the future, and the list just keeps growing.

However, you can conquer these obstacles by taking calculated risks. Letting yourself become fixated on the potential negatives, though, will only keep you from ever making a move. Corkran makes a compelling case that real estate investment isn't as daunting as it may seem.

In fact, it's within reach for nearly everyone. The key lies in a few fundamental principles. Firstly, choosing the right location is paramount. Opting for properties in high-quality areas can significantly mitigate risks and enhance potential returns.

Next, it's crucial to crunch the numbers meticulously, ensuring that the investment aligns with your financial goals and constraints. This includes assessing factors like potential rental income, expenses, and projected cash flow.

Take calculated risks, recognizing that successful investment often requires a willingness to step outside your comfort zone. This doesn't mean diving headfirst into every opportunity but rather making informed choices that balance potential rewards with potential downsides.

Focus on providing a top-notch product to tenants by having well-maintained properties and proactive management. Offering a high-quality living experience can attract and retain tenants, thereby safeguarding your investment's profitability.

As far as interest rates are concerned, Barbara Corkran believes that prices are going to go through the roof when interest rates come down. Sellers don't want to move from their home or apartment because of the relatively high-interest rates, and buyers are afraid to buy because they're getting less house for the same mortgage payment.

A reduction in interest rates could spur a major shift in the market, causing everyone to come out and buy like crazy. As a result, she sees prices rising by 20%.

Barbara Corkran's take on real estate investment shows just how simple it can be to build serious wealth. She's all about locking up your money in property, knowing it's a smart move that'll pay off in the long run. And she's right; property values tend to go up over time, especially if you're in a good area.

Plus, renting out properties can bring in some steady cash flow. Corkran's advice, like house hacking and getting in the game early, gives a clear roadmap for anyone looking to get ahead in real estate. So if you're thinking about jumping in, don't overthink it. Just follow Barbara's lead and start building wealth.