The real estate industry is booming. Most buyers seek a place to live; others treat this purchase as a long-term investment to secure their money. Over 5 million existing homes were sold only in 2018, according to the Association of Realtors. As this tendency is likely to grow, this might be a perfect time to start your own real estate business.
It is worth mentioning that this market is competitive. However, if you like challenges and have some knowledge about real estate, this might be a perfect opportunity for you. The process of entering the market is quite challenging, but with our tips below, you might struggle less and create a business of your dreams.
Real estate might be a pretty oversaturated industry, depending on the area. This field is competitive, which is why starting your real estate business might demand a lot of logical planning and creative thinking. If you want to succeed, you might want to follow the trends and use them to emerge in the market and outperform the competition.
For instance, elderly-friendly neighborhoods belong to the most popular trends. “The demand for senior housing continues to grow as the largest segment of the population starts to look at moving from their family homes. Predictions of a massive need for assisted living were off, and now the challenge is to create enough affordable independent living opportunities,” say specialists from Hilton Head Island oceanfront real estate. Do the research on the biggest demands amongst your targeted group, and who knows, maybe this might be an opportunity for you to step into the market?
First of all, don’t focus on the price when it comes to hiring a lawyer. It is better to pay more for legal help and work with specialists who know how to assess and react to your client’s needs.
Look for a lawyer who is familiar with the reality of the real estate business and has experience in representing brokers and agents. Don’t wait till the last minute to hire your law specialists. Their help might also come in handy in choosing the structure of your business and splitting the ownership interests if co-founders are included. In that way, you can protect everyone involved in your project.
In most cases, agents decide to be self-employed as the owners of a licensed real estate brokerage and run their business independently. The same goes for opening your own brokerage, but it might also require a special type of real estate license in order to start.
Nevertheless, you are still opening your own business. Your business strategies should be fully adjusted to your ultimate goals and the market you are aiming to enter. When it comes to brokerage, there are four options you might want to consider: sole proprietorship, partnership, limited liability company (one of the most popular choices), or a corporation. Don’t hesitate to ask your lawyer for advice to make the best decision and feel less overwhelmed with legal procedures.
Before starting your real estate business, you want to predict the costs of at least the first 6 months of your company’s activities. So that all the decisions and operations undertaken in the nearer future won’t exceed your budget. It is crucial not to overspend, especially in the emerging phases of the business. You want to build a sustainable and profitable system that will allow you to exist on the market and finally develop your scope of activities.
Try to implement an accounting system to keep track of your finances. This will help you gain a wider perspective on your business profit, expenses, income, capital expenditures, and losses.
If you are a newbie in the real estate business, getting a license is crucial before starting your business, as from now on, you will work as an official realtor. First, you need to take a real estate pre-licensing course for your state in order to pass the exam. After successfully passing it, you need to submit your real estate license application. Lastly, look for a broker you want to work for. This step demands in-depth research to make the right decision.
To obtain a broker’s license, you need to be a real estate agent with 2-4 years of experience. You need to complete pre-licensing education and then pass the broker’s exam. Remember that in both cases, application fees might start from $150, depending on the state.
Building a professional and compelling brand image can help you quickly emerge in the market and gain a greater profit from your sales. You might want to hire a PR specialist to help you with building a positive coating around your business, including outdoor and internet marketing. Having a strong online presence will help you gain recognition and build trust among your clients.
There are a lot of things to take care of before starting your own real estate business. The most crucial parts include choosing the most suitable business strategies and hiring a good lawyer. You might also want to get familiar with the marketing tools to build your company’s image on social media platforms and attract more potential clients.
Remember to plan your finances with a long-term perspective to create a sustainable and profitable business. It surely might be a challenging but at the same satisfying journey to your financial freedom as a self-employed person and a successful entrepreneur.