Jan 20 2015
How to Launch a Real Estate Business
Real estate can be a profitable business if you possess the necessary knowledge and a solid financial plan. While the growth of the British housing market has waned somewhat during the past year, due in part to the restriction on mortgages in October, experts are predicting that house prices are set to rise in 2015. A potential increase in prices could equal larger profits for real estate businesses, so now could be the perfect time if you are considering a startup.
Here are some helpful suggestions on how to launch a real estate startup.
Knowledge
As stated in the Estate Agents Act 1979, unless a person has been declared bankrupt or has received a ban from the Office of Fair Trading, they can operate their own real estate business without needing a license in the UK (unlike America or Australia).
However, while an agent in the UK may not need to possess formal qualifications or a license to operate a real estate business, they will need expert industry knowledge.
Working in real estate requires excellent people, management and business skills. As well as thorough knowledge of the local market, planning laws, and legal issues for buying and selling property. In addition, a comprehensive understanding of tenant and landlord law is essential for an agent who intends to let. In this instance, the day-to-day running of business will also require liaising with tradespeople, landlords and solicitors.
Create a Business Plan
Before writing a plan, consider how the real estate business will function. The trend of online real estate companies – who market and sell properties in much the same way as traditional agents but with lower fees – is continuing to grow. These two formats require different business plans, staffing levels and premises.
However, to run a successful business, there must first be a solid business plan in place. This document should outline a plan of growth via business goals and a corresponding time period, how this can feasibly be achieved and the capital needed/available to finance this new business venture.
A well structured plan can help keep track of progress and spot any potential flaws, as well as secure finance. A business plan is particularly important for an entrepreneur requiring funds for a startup business that often needs the support of investors. There are books to help those unsure of how to tackle this document, or alternatively, search online for guidance on how to write a business plan.