B
arbara Corcoran is famous for trusting her instincts over textbook finance, famously refusing to stash even a single cent of her wealth. Yet her $100 million net worth speaks to a winning formula she shares on the BiggerPockets Real Estate Podcast with her son Tom Higgins. She calls it the “golden rule”: put 20 % down on a property and let the tenant cover the mortgage.

    Corcoran’s own story began when she borrowed $1,000 from a boyfriend to launch a tiny New York real‑estate office after 22 failed jobs. She built the Corcoran Group into a powerhouse, selling it to NRT for $66 million in 2001. Since 2009 she’s been a regular on Shark Tank, closing deals with more than 100 startups.

    The 20 % down rule is simple. A lower down payment, like 10 %, leaves a buyer with a heavier monthly burden, especially when housing prices and rates stay high. A larger down payment speeds the path to breakeven and early gains. Corcoran stresses that while this rule has worked for her, it isn’t a one‑size‑fits‑all. Other investors, such as Alex Blackwood of Mogul Club, note that credit scores, interest rates, and local markets can alter the optimal leverage.

    Even with a solid track record, Corcoran rarely expects profit in the first couple of years. She views breakeven—when tenant rent covers the mortgage and operating costs—as a green light. “If I break even, I’m smiling all the way to the bank,” she says. In New York, property values tend to rise, allowing her to refinance and pull cash once the asset matures. Ian Formigle of CrowdStreet echoes that leverage amplifies returns but also risk; tenants covering costs mitigates that risk and fuels appreciation.

    Corcoran’s patience pays off. She bought a building for $1 million with a 20 % down payment and held it for 20 years, selling it for $3.2 million. She warns against early cash‑outs, noting that withdrawing funds too soon can cripple a portfolio. Instead, she kept the brokerage generating income while the properties grew, only tapping into the real‑estate equity once it had appreciated.

    Her approach—high down payment, tenant‑covered mortgage, long‑term hold—has guided her through a decade of successful deals and a $100 million fortune. It remains a testament to disciplined, instinct‑driven investing that balances risk, leverage, and patience.