Ever thought about starting a real estate business?
Well, now’s as good a time as any, and these seven steps can help you on your way to success in the real estate industry.
Form Your Business Goals
Starting a business begins with setting goals. It’s not easy to start a real estate business from scratch, and there will likely be times when you ask yourself whether it’s worth the hassle.
When those moments of doubt do occur, clear goals can be vitally important. If you’ve got short-term, mid-term, and long-term goals, then you’re constantly reaching milestones and you’ve always got something to work towards.
If you’ve set SMART goals (specific, measurable, achievable, relevant, and time-bound) it’s much easier to look back, see how far you’ve come, and get the motivation you need to keep going.
They also form the basis of your business strategy which will provide a blueprint for starting a real estate business.
Research the Relevant Licenses
Before you begin your journey into real estate you need to consider the relevant licenses. Each state has slightly different regulations, but you will need some kind of license to start a real estate business.
The two main licenses you will need to consider are the real estate salesperson license and the real estate broker license.
If you’re new to real estate, then your first stop will be the real estate license which allows you to work under a real estate broker. Once you’ve held a real estate license for two years, you can then study for your real estate broker’s license, which opens up a lot more opportunities for your business.
Both licenses require you to take a course and pass an exam. In the case of real estate agents, it’s the 75-hr salesperson course that prepares you for the real estate exam, and for brokers, it’s the broker course, which will prepare you for the real estate broker’s exam.
Find a Brokerage
This step depends on your level of experience in the industry and the license you hold.
If you hold a real estate broker’s license, then you’re free to set up your own business, independent of anyone else. However, if you have a real estate agent’s license, then you have to work under the umbrella of a brokerage.
This still enables you to have your own business, but you do so as part of a larger organization.
Choosing the right brokerage is an important step in starting a real estate business. You want to end up somewhere you can learn good habits from and build your reputation as part of a good brand.
It might just be a stepping stone for your business goals, but it’s one when you’re starting a real estate business.
When you’re running your own business there are lots of boxes you need to tick. When you’re getting set up as a real estate agent, this is something your brokerage will likely be able to help out with, but it’s always best to double-check.
Speak to your lawyer and accountants to make sure you’ve got everything set up and ready to go. The worst thing is to get started with everything only to run into problems further down the line, so don’t forget this step.
Do Your Market Research
All good businesses have a plan and that plan should be based on solid market research.
There are many questions you will have to answer when you’re starting a real estate business:
- What location will you focus on?
- What type of houses will you sell?
- What will your target audience look like?
- What is likely to be your best marketing channel?
These are all questions you can start preparing to answer today. It might take time to set up your business and get your licenses, but there’s nothing stopping you from doing your market research and putting your strategy together.
That strategy might change with time, but good research is always going to be valuable.
Think About Your Finances
It takes time and money to start a business. While real estate doesn’t have especially high start up costs, you do need to put some money aside to get the process started.
To begin with, you will need to pay for your licensing courses and the exam, but once you’ve got your license, you will also have to invest in your success. One of your key expenses is likely to be marketing — it’s suggested you spend about 10% of your commission on marketing.
Of course, when you’re getting started, it’s useful to have funds available to give you a head start and help get those first clients on board. It’s not all about your budget — your creativity will play a role too, but if you can start planning your finances now, then it will be a big help in the early days of your business.
Plan Your Marketing
Marketing is a huge part of any business, and it’s certainly true in real estate.
When you’re starting a real estate business, your first few clients are really important to get the ball rolling. Once you’ve landed your first clients, and you’ve earned some commissions, then suddenly everything looks a little bit easier.
If you can be innovative with your use of marketing, then it’s going to help you land more clients and get more out of your marketing budget. Think about setting up your own website, and look at the best ways to advertise yourself.
Conclusion: Starting a Real Estate Business
Starting a real estate business can be challenging, but there is a clear path you can follow. First, you need to understand your goals and figure out what you want your business to look like, and then you can start putting it into practice by getting the right license.
Summit RET is here to help you with this step by providing high-quality courses that are designed to help you pass the real estate and broker exams. The knowledge and skills you learn in these courses will help you one the way to starting a real estate business, and we even offer the courses you’ll need to renew your license along the way!