Barbara Corcoran is largely known for her role as one of the most powerful investors on ABC’s “Shark Tank” with an estimated net worth of $100 million. But do you know how she made a lot of her money? Corcoran built her wealth thanks to her wildly successful real estate career.
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She has been wheeling and dealing on the national stage for quite some time, and she has learned a thing or two about money along the way. If you’re looking for ways to improve your financial situation, Corcoran has a lot of advice to offer. Here are eight of her top tips, with a focus on the things she knows best: real estate and money management.
Buy a Home as Soon as You Can
When it comes to financial markets that can grow your wealth, Corcoran believes in getting into the real estate housing market early. Yes, this may be an ambitious short-term financial goal, but the long-term benefits make this a solid asset purchase.
“I think the sooner you get in the market, the sooner you have a chip in the game. You can trade up,” she said.
According to Corcoran, it’s always a good time to buy, because even if the market feels high now, house prices usually go up in the long term. If volatile economic activity as of late is any indication, you might want to get your financial assets lined up so you can heed her advice.
Don’t Wait for Interest Rates To Drop
While many people are waiting for lower interest rates before buying a home, Corcoran warns against this strategy. She believes that when rates do drop, there will be a rush to buy, driving prices up by 10% to 20%. Her advice: Don’t wait — act now.
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Look for Up-and-Coming Areas
When investing in real estate, Corcoran recommends buying in areas that are on the rise. “If you can saddle onto the back of an up-and-coming area, you’ll make a lot of money,” she said.
Not only can this get you property that will appreciate easily, but it can also help you avoid subprime mortgage-backed securities. This strategy often leads to significant profits when it’s time to sell.
Consider Areas With Poor School Districts
If you’re not planning to raise a family, Corcoran thinks you should look at areas with poor school districts. Why this instead of areas with better infrastructure and financial systems? Well, those areas often have lower property prices and also serious growth potential.
The one exception? Florida. Corcoran is not big into Florida right now.
“Go anywhere in the South other than the hot spots,” she said. “There’s always a cheap house to buy — always. But not Florida. Forget about Florida.”
Put 20% Down on Multi-Unit Properties
If you can afford it, Corcoran’s “golden rule” of real estate investing is to buy multi-unit properties with at least a 20% down payment. This may seem like a big ask upfront financially, but the payoff can be exponentially higher.
The reasoning behind this is that it allows you to break even and have tenants pay your mortgage. This will basically lead to you making the big bucks in the long term.
Focus on First Impressions When Selling
If you’re selling a home, Corcoran thinks you need to make sure your property looks inviting.
“Realize that the buyer walks in and judges that house within 30 seconds,” she added.
So, if you’re in the market to sell your house, make sure to give it a refresh — fix up the entrance, the living room and the kitchen, as these are the areas that buyers focus on.
Shop Around for Mortgage Rates
This is a rookie mistake, and one Corcoran thinks you need to avoid. Don’t settle for the first mortgage rate you’re offered. Instead, she thinks you should visit multiple banks and ask about special discounts for loyal customers.
“It’ll often save you a full quarter of a percent,” she said. “That doesn’t sound like a lot, but it adds up.”
Invest Early and Ask for Help If Needed
For young people looking to invest in real estate, Corcoran thinks you should start as early as possible. If your family has means, she also thinks you should ask them for help, especially for a down payment.
“There’s no shame in that,” she said. “Nobody buys under 40 in New York without the help of their families.”
Caitlyn Moorhead contributed to the reporting for this article.
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This article originally appeared on GOBankingRates.com: Barbara Corcoran’s Top 8 Tips To Save You From Financial Disaster
