Banks provide people with a safe place to stash their money and a potential source of financing, along with a slew of other services. Afterexpanding ...
How to Start a Real Estate Business
Investors like to say real estate is the strongest asset. Owning a piece of property is practically a requirement for every business and every family: it’s slow to depreciate and all but guaranteed to appreciate over time. No surprise, then, that the real estate industry presents serious opportunities for the entrepreneur. Running a real estate business is hard work, of course, requiring research and expertise, as well as time, energy, and maybe a bit of charisma.
But it’s also very doable. The key is understanding what’s required and advancing patiently through the business launch process, step by step. Whether your real estate operation will focus on residential, commercial, industrial, or land assets, certain business tenets and administrative tasks need to be completed. That’s where we come in, and this guide to starting a real estate business from scratch could have you counting your commissions sooner than you think.
Time to build
Step 1: Decide if the Business Is Right for You
A prospective real estate professional should first determine which type of business offers the best fit. Business in real estate can include:
- Real estate agency/brokerage – marketing and selling properties
- Real estate investing – buying and selling real estate for a return on investment
- Real estate management – managing real estate properties on day-to-day basis
This article will focus on starting a real estate agency or brokerage, in which you become a licensed agent and work with prospective buyers and sellers to move properties for a commission. Real estate agency customers include future homeowners and business owners buying office space.
Real estate agents are professionals with knowledge and expertise in the residential or commercial property space or both. To legally help people buy, sell and lease real estate assets, they must operate with an official real estate license issued by the state in which they work. Generally, agents work for a sponsoring agency or brokerage firm, though some work independently.
Real estate brokers are agents who have gone through further education to gain their broker’s license. Brokers can work independently or hire agents to work for their business.
Realtors are licensed real estate agents or brokers who are members of the National Association of Realtors (NAR). They are as a result beholden to NAR’s code of ethics and are part of a reputable trade association, which provides significant resources.
Essentially, on your journey into the real estate industry: you begin as a real estate agent and then can work to acquire more experience, knowledge, education, and licensing certifications to become a real estate broker or a realtor, or both. Each additional title is viewed as an upgrade, enhancing reputation and earnings potential.
The education and examination process to gain a real estate license typically takes 4-6 months, so if you’re just starting now you have some time to prepare for launching your real estate business.
Pros and Cons
Every business has its advantages and disadvantages. It’s a good idea to weigh these factors to help you decide if real estate is right for you.
- Flexible – Even working for an agency, a real estate agent has a good deal of independence, choosing your own work hours and area.
- Dealing with people – If you enjoy interacting with others, engaging and persuading, being a real estate agent might be the job for you.
- High income – By helping sell properties for commissions, your income potential will be limited only by your sales totals.
- Dream seller – A new home or business property can make people’s lives better; you will be in the business of selling dreams.
- Extended hours – The open-ended nature of real estate sales often leads to evening and weekend work.
- Dealing with people – For some, this is less than ideal.
- No salary, no guarantees – Agents rely completely on commissions, earning no salary, and your income could drop sharply during slow periods.
- High-stress decisions – Buying a new home or office is a major investment, a crucial life decision; you will often work with people dealing with stress and anxiety.
The global real estate industry saw total revenue of $4.24 trillion in 2020, highlighting a compound annual growth rate (CAGR) of 1.3% since 2016, according to market research firm Research and Markets. … Continue reading The US real estate market took in nearly $462 billion in revenue in 2020, according to German research firm Statista.https://www.statista.com/study/15824/real-estate-in-the-us/ The value of all US real estate experienced its biggest increase in 15 years in 2020, gaining nearly $2.5 trillion in value, according to leading online realtor Zillow.https://www.prnewswire.com/news-releases/2020-us-housing-market-gains-were-biggest-in-15-years-301214718.html
In a 2021 report, leading consultancy PriceWaterhouseCoopers (PWC) detailed the key trends of the real estate market,https://www.pwc.com/us/en/industries/asset-wealth-management/real-estate/emerging-trends-in-real-estate.html including:
- 5-10% price decline – The continuing COVID-19 pandemic is expected to reduce real estate prices 5-10% and keep them down for a number of years, with industrial properties, data centers, and single-family homes expected to rise in value while retail and hospitality properties see the largest decline.
- Suburban growth – With the rise of remote work, higher city taxes, and greater appreciation for low-density living, suburban populations are expected to grow.
- Remote work transition – Most businesses now allow or even encourage remote work, which means office real estate sales and leasing are expected to decline, though business investment in digital capabilities such as server space may increase.
- Safety and wellness measures – Due to COVID-19, real estate agents are expected to closely follow all health and cleanliness regulations at their properties — especially hotels, office buildings, retail and restaurants.
- Social justice and racial equity concerns – Recent polls say real estate buyers and sellers are showing greater concern about the impact of real estate laws and practices on racial minorities and underserved communities.
- Retail transition – Amid the pandemic and changing consumer tastes, US retail is moving away from big box and department stores and embracing discount, fast fashion and online retail, which is reshaping commercial real estate.
- Affordable housing issues – Housing disparities for low-income workers and threats of eviction mean that federal, state, and local governments could be pressed to provide programs and solutions to address affordable housing issues, which would take some housing stock off the market.
- Fiscal challenges – Declining real estate tax revenues, as a result of hotels, malls, and offices losing tenants and value, means local governments could face financial challenges that erode their services and resources. This could mean less subsidized real estate loans, lesser infrastructure investment support from local governments, and potential changes in interest rates.
According to PWC, the top 10 US real estate markets in 2021 are:
- Raleigh/Durham, NC
- Austin, TX
- Nashville, TN
- Dallas/Fort Worth, TX
- Charlotte, NC
- Tampa/St. Petersburg, FL
- Salt Lake City, UT
- Washington DC/Northern VA
- Boston, MA
- Long Island, NY
In a comprehensive overview of the 2020 US real estate market, Forbes noted a crucial statistic for prospective real estate business owners: more than half of real estate transactions today are facilitated by inexperienced, part-time agents.https://www.forbes.com/sites/forbesrealestatecouncil/2020/10/06/15-upcoming-trends-that-will-impact-the-real-estate-market/?sh=a8cb489d513b This has spurred greater demand for more experienced agents who provide clients with best-in-class service and results. Additionally, Forbes expects independent brokerages to receive a smaller share of real estate business as corporate and venture capitalist-backed brokerages gain market share.
In a forecast of the 2021-2022 housing market, high-end realtor Norada Real Estate Investments said home prices increased 11% in 2021 due to robust demand and record low mortgage rates, but that growth would slow to around 5% in 2022.https://www.noradarealestate.com/blog/housing-market-predictions/
Federal Reserve Economic Data (FRED) shows US real estate revenue on a steady incline over the past decade, despite significant dips every year.https://fred.stlouisfed.org/series/REV5312TAXABL144QNSA
Total revenues for U.S. agents and brokers per year (in millions of dollars):
|2021||$78,752 (Q1+Q2 only; on pace for +16%)|
How much does it cost to start a real estate business?
Real estate agent advisory Building Better Agents says that as a new real estate agent you should expect the following startup and early operations costs:
|Startup Costs||Ballpark Range||Average|
|Real estate license||$450-550 startup||$500|
|Brokerage fees||$300-400 startup ($100-200 per month)||$350|
|Operation costs||$115-345 per month||$230|
|Lockbox key||$10-20 per month||$15|
|Business cards||$5-10 per month||$8|
|Board of Realtors (NAR)||$30-50 per month||$40|
|MLS (Multiple Listing Service) access||$20-40 per month||$30|
|Gas||$25-75 per month||$50|
|Client coffee / lunches||$25-150 per month||$88|
|Marketing expenses||$100-300 per month (varies)||$200|
|Education expenses||$10-30 per month||$20|
|E&O (errors and omissions) insurance||$50-100 per month||$75|
|TOTAL startup + recurring||$1,125-1,925||$1,525|
A real estate agent needs to get a state license to operate, which includes the cost of a pre-licensing course (~$300), study guides, books (~$35), and any fees to take the exam (~$150), plus a background check (~$40). The total average cost comes to $525.
Operating as a real estate agent, you will typically split your commission with a broker according to a predetermined arrangement. The commission split can range from a 90% (you) / 10% (broker) split to a 50/50 split, depending on experience level and negotiation process. You must pay certain fees at startup and then on a monthly basis, averaging $350 at startup and $125 per month thereafter.
Monthly operational costs will include some of the basics for running your real estate business, not including an office space rental. Marketing costs – which can vary wildly depending on your approach – include your website, photos and videos of listings, and online ads to promote your business and your properties.
How much can you earn from a real estate business?
Established real estate agents can expect to earn nearly $50,000 per year, according to the latest data from the US Bureau of Labor Statistics. These annual income figures are based entirely on commission and can thus vary widely, from less than $25,000 for the industry’s bottom 10% to more than $112,000 for the top 10%. Real estate brokers, given their higher certification and education, typically earn more, with the median at just over $60,000 in 2020.
A real estate agent’s first few years may be in the lower-income bracket due to inexperience and the need to build a reputation and client base. But after a couple years, an agent or broker is likely to be closer to the $50,000 median. Real Estate Express highlights the advantage of sticking with it: an agent with 10+ years of experience ($83,177) makes more than double that of an agent with 2-3 years experience ($41,023).
The average real estate agent commission in the U.S. is about 5-6% of the sale price, according to real estate advisor Clever. So if you sell a home for $250,000, you will earn about $12,500 to $15,000, less your split with the broker.
This means agents and brokers can potentially live off just a handful of sales per year, depending on area of specialization. In fact, the average U.S. real estate agent closes just 5 to 12 sales per year, according to the NAR. The challenge is making those sales and getting those commissions, which are likely to be your sole source of income.
What barriers to entry are there?
Barriers to entry as a real estate professional include:
- Competitors – Due to the relative ease of entry (no college degree necessary) and potentially lucrative nature of the business, competition is fierce. Rival agents and brokers will often be looking to sell the same property you are.
- Education & licensing – Operating as a professional agent or broker, requires an outlay of time, effort, and money to earn your license. Keeping up on your continuing education and knowledge of your area and property specialization are also important.
- High earners require experience – It can take years to establish yourself as a knowledgeable, qualified, and well-connected real estate professional. While barriers to entry may be low compared to other high-earning industries, becoming a top earner takes years, and there are no shortcuts.
Step 2: Hone Your Idea
Why? Identify an opportunity
If you are a people person with a knack for understanding how a new home or office can change lives, then starting a real estate business could be perfect for you.
A good first step is to narrow down your business location for your business: do you want to be urban or rural? Working in the big city or a small town? Next, consider what type of property you would like to focus on: residential, commercial, industrial, or land. Keep in mind, while residential homes may see the most sales, they are also the most competitive.
Researching the top real estate opportunities in your area should help determine which category to pursue. Look for answers to questions such as: What kind of homes are people buying? Where have home sales recently increased? What types of commercial properties are most popular in my area? Are any niche property types drawing more attention lately?
As a real estate agent you will need to ally with a broker to complete your transactions. A smart approach is to choose someone with whom you’re able to communicate and collaborate. New agents are legally required to work under a broker for a period of time that varies by state, but is often several years. The ideal choice is a broker that is willing to guide you through the industry ropes, so look for a professional you can trust. Remember your earnings will rely on commissions that will be split with this person.
What? Determine your products or services
As an agent you will be focused on meeting people and showing them the features, as well as the buying or selling options, of a certain property. It’s crucial to be pleasant and personable as you guide people through one of life’s major milestones.
Real estate offers several industries and roles you might tap into, each with their own certifications and designations:
- Residential Real Estate – Help clients buy and sell homes, including property valuation, financing, mortgages and aid with government programs. Agents and brokers require a state license. The Accredited Buyer’s Representative (ABR) and Seller Representative Specialist (SRS) certifications are also useful.
- Commercial Real Estate – Help clients evaluate and buy/sell income-producing properties including office buildings, shopping centers, industrial parks, and apartment complexes. Some states require agents or brokers to have a specialized commercial license. The Certified Commercial Investment Member (CCIM) and Certified Commercial Advisor (CCA) certifications are useful within this area.
- Property Management – Maintain and manage properties such as apartments, condominiums, and vacation rentals. Property managers typically work for real estate firms and most states require a license to collect rent, list properties or negotiate leases. The Certified Property Manager (CPM) and Accredited Residential Manager (ARM) certifications are useful in this area.
- Real Estate Appraisal – Help determine the value of properties for people and businesses, for investment, tax, accounting, or insurance purposes. Appraisers generally work for banks or appraisal firms and must be licensed by the state. The Residential Accredited Appraiser (RAA) and General Accredited Appraiser (GAA) designations are useful in this area.
- Real Estate Counseling – Research and advise to help investors determine the future value of properties. This service is often unique to each client’s needs. Real estate advisors usually have backgrounds in valuation, development, and property management. The Counselor Real Estate (CRE) designation is useful in this area.
No matter which avenue you choose, your goal as a professional is to provide indispensable value to your clients on assets that will likely be vital to their business or their lives.
How much should you charge for your real estate business?
The average commission is 5-6% of the sales price, which will be split by the agent and the broker as per their agreement. Depending on the client and the broker, commissions may be negotiable.
Top real estate agents often demand a higher commission and a more advantageous split with their broker. Both agents and brokers require a license to receive a commission, and brokers generally pay agents as independent contractors.
Who? Identify your target market
Your target market depends largely on your area of specialization. If you choose residential, you will zero in on families and working professionals ready to invest in a home. If you go with commercial, your focus will be on business owners and companies in need of retail or office space.
Keep in mind that homeowners and business owners may buy property with investment criteria in mind, such as a specific appreciation rate or sales timeline. It is an agent’s job to be aware of their buyer or seller’s criteria for each and every transaction.
Where? Choose your business premises
Since most of an agent’s in-person work can take place at the property itself, the profession is flexible in terms of premises. You can rent or buy office space and have a place to host clientele, plus room for assistants, partners, or employee agents. Or you can operate from home, working part- or full-time and traveling to meet clients on-site when needed.
This flexibility, along with the income potential, attracts many entrepreneurs. In the early stages of your business, you may want to operate from home to keep expenses in check. As your business grows, you might need to hire workers and move into an office space. You can find commercial space to rent in your area on Loopnet, Instant Offices and Square Foot.
While choosing an office space, here are four rules of thumb:
- Central location easily accessible via public transport
- Open, ventilated and filled with natural light
- Flexible lease that can be extended as your business grows
- Ready-to-use space with no major renovations or repairs needed
Step 3: Brainstorm a Business Name
Your business name is your business identity, so choose one that captures your objectives, services, and mission in just a few words.
Settling on a business name is a key step. You probably want a name that is short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.
Here are some suggestions for brainstorming your business name:
- Short, unique, and catchy names tend to stand out
- Names that are easy to say and spell tend to do better
- The name should be relevant to your product or service offerings
- Ask around — family, friends, colleagues, social media — for name suggestions
- Including “realty”, “property” or related words in the business name boosts SEO
- Use tools like the Step by Step business name generator
- Avoid location-based names, as they may hinder future expansion
Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names at a web cataloging site such as NameChk. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these.
Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. And if you’ve exhausted all your creative juices but still don’t have a business name, don’t stress! Instead, check out our business name generator. Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.
Step 4: Create a Business Plan
Every business needs a plan, a rough outline that helps guide a startup through the launch process while maintaining focus on key goals. A business plan is also crucial for helping potential partners and investors understand your company and vision before they invest:
- Executive Summary: Brief overview of the entire business plan; should be written once the plan is complete.
- Business Overview: Overview of the company, vision, mission, ownership, and corporate goals.
- Product and Services: Describe your real estate company’s services in detail.
- Market Analysis: Assess market trends such as variations in demand and prospects for growth, and do a SWOT analysis.
- Competitive Analysis: Analyze main competitors, assessing their strengths and weaknesses, and create a list of the advantages of your services.
- Sales and Marketing: Examine your companies’ unique selling propositions (USPs) and develop sales, marketing, and promotional strategies.
- Management Team: Overview of management team, detailing their roles and professional background, along with a corporate hierarchy.
- Operations Plan: Your company’s operational plan includes procurement, office location, key assets and equipment, and other logistical details.
- Financial Plan: Three years of financial planning, including startup costs, break-even analysis, profit and loss estimates, cash flow, and balance sheet.
Step 5: Register Your Business
Registering your business is an absolutely crucial step — a prerequisite to paying taxes, raising capital, opening a business bank account, and other guideposts on the road to getting a business up and running.
Registration is also exciting because it makes the entire process official! Once it’s done, you have your own business.
Choose where to register your company
Your business location is an important decision because it can affect your taxes, legal requirements, and revenue. Most people will register a business in the state where they live, but if you are planning to expand, you might consider looking elsewhere, as several states offer real advantages when it comes to real estate.
If you’re willing to move, you could really maximize your business!
Choose your business structure
Businesses come in several varieties, each with its pros and cons. The legal structure you choose for your business shapes your taxes, personal liability, and business registration requirements, so it’s important to choose wisely.
Here are the four main options:
- Sole proprietorship – The most common structure for small businesses makes no legal distinction between company and owner: you get to keep all the profits, but you’re personally liable for all debts.
- Partnership – Similar to a sole proprietorship, but for two or more people. Again, they keep the profits and are liable for losses.
- Corporation – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly.
- Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
We recommend that most new business owners form an LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can quickly and cheaply form an LLC using ZenBusiness’s online LLC formation service (it can take as little as 5 minutes). They will check that your business name is available before filing, submit your Articles of Organization and be on hand to answer any questions you have about the company formation process.
Step 6: Register for Taxes
Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate on a calendar year (January–December), or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.
The IRS website also offers a tax-payers checklist, and taxes can be filed online. It is important to consult an accountant or other professional to help you with your taxes to ensure you are completing them correctly.
Step 7: Fund your Business
Securing financing is your next step and there are plenty of ways to raise capital:
- Bank loans: This is the most common method, but getting approved requires a rock-solid business plan and strong credit history.
- SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
- Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
- Venture capital: Offer potential investors an ownership stake in exchange for funds, keeping in mind that you would be sacrificing some control over your business.
- Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund an entrepreneur’s vision.
- Personal: Self-fund your business via your savings, the sale of property or other assets, and support from family and friends.
Step 8: Apply for Licenses/Permits
Starting a new real estate business requires you to obtain several licenses and permits from the local, state, and federal authorities.
To operate as a real estate agent or broker, you will need to do the requisite coursework and take the exam to gain the license for your state. To operate as a Realtor, you need to already be a licensed agent or broker, then work to attain official certification from the National Association of Realtors (NAR).
Federal regulations, licenses and permits associated with starting a real estate business include doing business as (DBA), health license and permit from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents and other intellectual properties (IPs), as well as industry-specific licenses and permits.
Additional permits may be required by your state, such as a general business permit or license. The license requirements and how to obtain them vary from state to state, so check your state government’s website or contact the appropriate person to inquire about licenses and permits that you need to run a real estate business. You could also use the SBA’s guide to identify the required licenses and permits for your industry and your state.
Your city, town, or county may also have additional requirements for a real estate business, such as signage and zoning permits. Speak to representatives of your local governments about licensing requirements.
This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties. If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.
For peace of mind and to save time, we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state, and provide them to you to make sure you’re fully compliant.
Step 9: Open a Business Bank Account
Property sales commissions tend to be sizable sums, so you will need somewhere to keep your earnings, and that means opening a bank account.
Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your business as a sole proprietorship.Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer business account options, just inquire at your preferred bank to learn about rates and features.
But it is a good idea to look at a few options, as banks vary in terms of offerings, and you want to find the plan that works best for you. Once you choose your bank, you just need to bring your EIN (or Social Security Number if you decide on a sole proprietorship) and your articles of incorporation or other legal documentation that proves your business is registered.
Step 10: Get Business Insurance
Business insurance is an area that often gets overlooked but is vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your life and business.
Here are some of the different types of insurance to consider:
- General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
- Business Property: Provides coverage for your equipment and supplies.
- Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
- Worker’s compensation: Provides compensation to employees injured on the job.
- Property: Covers your physical space, whether it is a cart, storefront, or office.
- Commercial auto: Protection for your company-owned vehicle.
- Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
- Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of any of the above insurance types.
Step 11: Prepare to Launch
As opening day nears, prepare for launch by reviewing and perfecting some key elements of your business.
Develop your website
Website development is crucial because your site is your online presence, and needs to convince prospective clients of your expertise and professionalism.
You can create your own website using services like WordPress or Squarespace. This route is very affordable, but figuring out how to build a website can be time consuming. If you lack tech-savvy, you can hire a web developer to create a custom website for your business.
Essential software and tools
Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, a number of excellent software programs and digital tools can help you with many business tasks. We have broken them down into different categories below.
Real Estate Software & Online Tools
Some real estate-specific tools and software, such as customer relationship management (CRM) platforms, can help you manage your business. To get started, we recommend you test some of the following:
- Zillow Premier Agent – Network and advisory for agents, brokers
- RealScout – Homebuying search engine
- Contactually – Customer relationship management (CRM) software for real estate
- Structurally – A.I. that helps agents, buyers, sellers with leads
- PropertyBase – End-to-end real estate software platform
- Real Geeks – Real estate sales and marketing platform
Some of your business will be walk-by customers and web surfers, but you should still spend time on marketing. Especially as a new business, getting the word out and increasing customer awareness is crucial.
Social media is a particularly good way of promoting your business because you can create engaging posts that advertise your products:
- Facebook: Great platform for paid advertising, allows you to target specific demographics, like men over age 50 in the Cleveland area.
- Instagram: Same benefits as Facebook but with different target audiences.
- Website: Search engine optimization (SEO) will help your website appear closer to the top in relevant search results, a crucial element for increasing sales.
- Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero.
- If you are unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial.
Step 12: Build Your Team
You may not need to hire any employees if you are starting out with a home-based office. But as your business grows, you will need to hire full-time employees for various positions, such as:
- Real estate agent/broker
- Listings Manager – Assists agents with research and contracting
- Transaction Coordinator – Oversees transactions through to closing
- Marketing Director
- Showing Assistant – Readies and shows properties to prospective clients
Your business may at some point need to hire all of these positions, or just one or two of them, depending upon its size and needs. You might also hire multiple workers for a single role, or a single worker for multiple roles, again depending on your needs.
Free-of-charge methods to recruit employees include publishing a job post on social media platforms such as LinkedIn or Facebook, or using free classified sites like Jobs and AngelList. You might also use a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Finally, you could hire a recruitment agency to help you find talent.
Step 13: Start Making Money!
Focus on USPs
Unique selling propositions, or USPs, are the unique characteristics of your product or services that sets it apart from the competition. Customers are inundated with buying options and need to be able to quickly grasp what’s novel about your product and how it fulfills their wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire.
Here are some examples of USPs in the real estate industry:
- Experience with previous residential or commercial deals
- Local expertise
- Housing expert
- Buyer or seller expert
- Fast and efficient closing
- Market research specialist
- Recognizable brand or charismatic presence via billboards, online ads, etc.
- Website and SEO – Create a website and optimize it for search engines.
- Social media marketing – Create a strong social media presence, especially on Facebook, Twitter and Instagram, by posting regularly.
- Competitions and giveaways – Via email or social media, generate interest by offering prizes to people who complete a certain action.
- Marketplace – Review virtual storefronts on marketplaces such as Zillow and Realtor and maintain a strong presence there.
- Signage – Put up eye-catching signage outside your office and properties you’re looking to sell.
- Promotional Materials – Distribute brochures or flyers in the area of your business, as well as at industry events and tradeshows.
Real Estate Business FAQs
The required license for a real estate agent or brokerage will depend upon your state. The US has no national real estate license (though there is a national certification for Realtors, with the NAR). You should begin your research based on the requirements of the state in which you plan to do business.
Yes. Almost everything in real estate is negotiable. The negotiations mainly depend on discussions between the buyer and seller. For commissions, agent and broker come to an agreed-upon division. Property prices and commission negotiations hinge on the experience level and leverage of the main parties.
This depends on your life circumstances and desired work schedule. Keep in mind, your average seller or buyer is less likely to use a part-time agent, who are thought to have less expertise. In addition, as a part-time agent you may be required to lower your commission or agree to a less favorable split with your broker.. Being a full-time agent, on the other hand, requires more time and energy, while offering greater earnings potential.
As a new agent, search for a broker just as you would for any business partner. Find a brokerage you can trust, with strong management, industry expertise, reasonable commission splits, an online presence, solid reputation, and the capacity to support your career. Real Estate Express provides a handy guide for new agents.