How To Start A Successful Real Estate Business
by Arnab Dey Business 13 July 2022
When you think about business options and real estate comes to mind, you’re probably conjuring up mental images of selling mansions to millionaires and pocketing the enormous amounts of commission that those sales will give you, but in reality, most realtors fail in their first year so this blog explores the common reasons for failure, and how to avoid them.
Why Real Estate Agencies Fail
Before turning your attention to things you can do to succeed, it is important to understand why businesses fail so that you can learn from the experiences of others and avoid making the same mistakes.
1) Unwilling to cold-call –
Also known as “prospecting”, cold-calling people can be an unappealing task for many but if you want to generate sales, it is essential. A good realtor will dedicate a part of every day to following up leads, contacting would-be sellers, and chasing up registered buyers to encourage them to view their properties.
2) Poor marketing of the properties on their books –
It’s no secret that success drives success so if your clients see neighboring properties selling quicker than theirs are with you, they will switch to the other realtor.
It is essential to embrace all forms of marketing to ensure that the properties on your books get maximum visibility and where possible, a fast and efficient sale.
3) Trouble building or maintaining relationships with clients –
Many realtors fail to keep in regular contact with their clients which is essential to maintain a relationship and build trust. When this happens, those clients will take their money elsewhere.
4) Running out of money –
Unfortunately, it takes time to sell a property and even if you have a buyer on the hook, a successful real estate business with insufficient capital runs the risk of financial failure before the first home on its books is sold.
How To Be Successful
Clearly, the short answer is too cold call lots of people, market your properties in the most amazing way, become your clients’ best friend, and have lots of money to start with, but hopefully, the detail below will give you a bit of a steer.
1) As with all businesses, it is essential that you go into it with your eyes wide open. You should prepare a business plan which clearly and concisely details how your business will run, be funded, and pay for itself until such time as it starts generating a profit.
It should explain what staff will be required, the area you’ll cover, provides a detailed analysis of your competition, and what you plan for your niche to be. This document has to be realistic otherwise it will not help you to channel your efforts and finances in a successful direction.
2) Follow up leads. This includes contacting the owners of properties that are listed “For Sale By Owner” to sell your services – you need to be great at explaining why you will do a better job at selling their home than they will so practice your sales pitch! Holding some Open House days will generate plenty of contacts so make sure to foster those, contact them, and do your best to deliver on your promises. By delivering quality, personal service, your reputation will soon grow via word of mouth.
3) Market your properties wisely. Help your buyers to present their homes in the best possible state to attract buyers and set the price right – too high and you’ll put people off, too low and buyers will wonder what’s wrong with it. Advertise it widely in all the right mediums including in your shop window if you are in a high foot traffic district.
If you are short of window space, digital screens for real estate are a fantastic option for showcasing your offerings – set up a reel displaying all available properties and it is bound to be noticed. And whilst we’re talking about technology, don’t forget to keep your website updated – buyers will be seriously frustrated if they call about a property that they have seen on your website only to find it has already sold.
Summary
The American property market continues to experience unprecedented growth [2] so although starting your own successful real estate business can be a risky option, for those that are well prepared and determined to succeed, there is certainly money to be made in this field.
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