Starting a real estate business seems like a dream for everyone. A seven-figure income and unbound to the desk like nine-to-five jobs. Well, it's not as easy as it may appear to everyone.
You may think how hard it could be to sell or buy a property. Just a massive amount of capital, and you're good to go. But that's not the case. There's more than just buying and selling to a real estate business. You must be organized to keep up with the legal documents, get that math done, and perform numerous other tasks.
One thing you should know about starting a real estate business is that there will be times when you won't make any money. If you don't sell anything, you don't earn. On the bright side, selling only a few properties monthly can give you a hefty income.
If you don't know how to start a real business but want to start one, this article can walk you through everything you need. Below we will discuss the types of real estate businesses and practical strategies on how to grow your real estate business.
Real Estate Business–An Overview
The real estate business involves buying, selling, renting, and managing lands, homes, and other structures. A real estate business can be seen as a high-value and low-frequency business. Meaning homes, shops, and other buildings provide high value to customers, but nobody buys a building daily.
Before discussing how to start a real estate business, let’s learn about its types. You may have to implement different strategies to different types accordingly.
- Commercial real estate
- Residential real estate
- Industrial real estate
Commercial Real Estate
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Commercial real estate involves buying, selling, and renting commercial properties, such as restaurants, schools, shopping malls, office buildings, parking lots, etc.
Residential Real Estate
Residential real estate includes dealing with properties used for living with family or individually. There are different categories of residential real estate, such as bungalows, single-family homes, residential buildings, condos, etc.
Even if not in the real estate business, almost everyone is involved in this category because everyone needs a house to live in, regardless of the profession.
Land real estate is buying, selling, or renting just plain land. Meaning there are no buildings or structures already built. You only get the piece of land with boundaries that mark where your property starts and ends.
In some places, a piece of land can come with natural resources, such as gas and oil. In that case, its value increases.
Industrial Real Estate
This real estate business involves industrial properties such as factories, warehouses, places carrying out mechanical productions, or offering transportation services, etc. The industrial real estate business requires massive capital.
Here's what you need to know if you're confusing the industrial real estate business with the commercial type. Thousands of people visit commercial properties such as offices and shopping malls daily, while industrial properties only see workers and not customers.
Strategies to Start and Grow Your Real Estate Business
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This list of tips will teach you how to start a real estate company and succeed.
1. Pick a Niche
Real estate deals with four different categories of properties that are further divided into small types based on the target audience and their needs. For instance, if you choose to go with the residential real estate business, you will have to narrow your category even more to choose your target audience. If you decide to deal with apartments or condos, your target audience will be middle or lower-class people with low to medium incomes.
If you decide to deal with bungalows, you will target wealthy people as your significant audience. Why is it important to know your target audience? It will be helpful for marketing. You will learn what your target audience is attracted to and what puts them off, helping you create a marketing campaign that will go popular amongst your audience.
Research is the key to making or breaking a business regardless of the niche. When starting a real estate business, you will be researching real estate trends, what location will be an easy sell, and other factors that can affect your business.
The research will help you study your business's current position and foresee the upcoming hurdles and rewards. It will also give you an idea about what measures you should take when stuck in a particular problem and what steps your competitors take to get the point over you. Researching competitors can load your brain with ideas and help you pick your next move.
3. Create a Business Plan
Some people may start a real estate company without creating an actionable business plan. This is a dangerous move. A business plan contains everything from your business's structure and your predicted income to how much you will be investing. Your business plan must include the most minor steps for your real estate business.
A business plan keeps you on the right track encouraging you to work in an organized manner rather than being all over the place doing everything at once.
4. Pick a Suitable Legal Entity
Numerous business structures have pros and cons. You must study each structure and conclude which goes best with your real estate business. For example, if you're handling everything on your own, such as investments, you can start a real estate business as a sole trader. That means you will be the only business owner, keep all the profits by yourself after paying the tax, and bear the loss alone.
5. Get Some Capital to Invest
Before arranging the capital, you need to decide whether you will need to invest. If you want to be a real estate agent, you won't have to invest any money. A real estate agent sells other people's properties and earns a commission on each sale. But that doesn't make you a hefty income. The income can be high but not massive.
You should arrange the required capital to buy and sell your properties. It's up to you what method you should use to fund your business. You can invest your savings, borrow from friends or family, or use other business funding methods.
6. Get a Website
A website is essential for starting a real business. In this digitilized age, a website is one of the places people go to know about a company. Moreover, a website indicates that your business is authentic because non-serious business people won't spend money and time building a website.
To ensure a healthy online presence for your real estate business, you don't only need a website, you need an excellent website. Here are some characteristics that make a website look professional.
- Straightforward navigation.
- Usage of visual hierarchy in the design.
- Easily readable text.
- Clever use of whitespace.
- The moderate use of colors.
- Suitable to view across every screen size.
Now that you know what makes a good website, let's tell you where you can create an exceptional one without much work. Strikingly a website builder is an excellent option for building a website if you're a beginner. It allows its users to create websites using pre-made templates. Those templates can be edited in Strikingly's intuitive website editor, which offers a drag-and-drop feature for designing your website.
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Strikingly puts forward multiple features such as an online store, a simple blog for content marketing, an email marketing service, a custom domain (you can either register a new one or connect an already purchased one), and social media integration option.
Moreover, Strikingly's all templates are mobile responsive, ensuring your website can scale up and down without running its design and layout.
Strikingly is free to use, but you can get a hold of premium features by spending a few dollars. Strikingly's the smallest plan (Limited) costs $12/month, the mid plan (Pro) costs $20/month, and the most expensive plan (VIP) costs $59/month when billed monthly. Further, if you extend your billing period, the cost goes down.
7. Create a Marketing Plan
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Marketing gets the word about your business to your target audience. Your marketing plan will contain the following:
- The strategies you will be implementing.
- The amount of money you will be spending.
- Mission statements (refers to goals and reasons your company exists).
- Your target audience.
Here are multiple ways you can market your business.
- Put up a signboard.
- Hand out brochures.
- Post on social media.
- Run social media advertisements.
- Run different ads, such as display ads, native ads, etc.
- Send newsletters to your potential customers.
- Use Search Engine Optimization to get exposure in Google's search results.
- Host virtual or physical events. You can arrange exciting activities to encourage people to participate.
A great way to make your marketing campaign a success is by segmenting your potential buyers based on their preferences and implementing marketing strategies according to each group's preferences.
Starting a real estate business is not easy, but it's not impossible. The more knowledge you have in the real estate business, the more opportunities you can create.
That was all you needed to know about starting a real estate business and making it a success. Lastly, begin with your real estate journey today; work hard until you meet your goals.