Everything You Need to Know About Real Estate Franchises
You've reached a point in your life where working for someone else is no longer acceptable. The question is do you start a business by yourself, or invest in opening a franchise? In your case, the idea of owning a real estate investment franchise seems like the right fit.
Before you go any further, it pays to learn what this type of venture entails. The following will help you get a better idea of what's involved, and how it fits in with your abilities as well as your goals.
Why Own a Real Estate Franchise in the First Place?
Before delving too deeply into this type of business opportunity, it pays to understand why you want to own this type of franchise. This means looking closely at what your goals happen to be, as well as your interests and aptitudes. There's also the level of commitment you're willing to make.
Ask yourself questions that require specific answers. For example, does a real estate franchise allow you to draw on the skill set that previous work helped you develop? Do you find it easy to discuss business matters with enthusiasm? Are hard-to-please clients more of a chore, or do you see them as an opportunity?
Remember that your long game also comes into play here. What specifically do you hope to get by owning a franchise? Are your goals primarily to earn a living, or to ensure there is a certain amount of resources on hand by the time you retire? Does personal satisfaction in terms of helping people find homes they will love enter into the picture?
Only you can determine if this is the type of franchise for you. If the answers to your questions all point toward finding and owning the right real estate franchise, then you are moving in the right direction.
Understanding the Differences Between Types of Real Estate Franchises
Have you considered the fact that there's more than one type of real estate franchise. In fact, there are multiple possibilities. Just about all of them can be segregated into two specific categories. It's up to you to decide which types of real estate franchise opportunities fit in with your plans for the future.
A brokerage franchise is one approach that you may consider. In this scenario, you will be working closely with people who have expressed an interest in buying or selling their real estate, but haven't necessarily gotten to that point yet. Your goal is to motivate them to begin actively making a move, then refer them to a local agency for further assistance.
Another option is to open a dealership. In this scenario, you are working with people who have already made a choice to buy or sell. Your goal is to find a buyer for their properties, or help the client locate the ideal property. You will also be intimately involved with getting the paperwork done and ensuring everything is done in compliance with current real estate laws.
Dealerships also offer other forms of real estate services that involve direct interaction with clients. If you're the type of person who likes the idea of focusing mainly on those who are already qualified buyers, sellers, and owners, then the latter type of real estate business is likely to be a good fit.
And The State of the Local Market
Before jumping on a real estate business for sale Atlanta GA that seems to be just right, it's a good idea to step back and take a look at the current market. In the case of a metropolitan area, it's good to look outside the city limits and consider the suburbs as well. The point is to make sure there's enough potential business to keep your franchise operating at a profit.
Consider the economy and how it's affecting the market. Are sales slow and take a long time? Are there signs that the market is about to shift? How will that shift affect the demand for the services your franchise offers? If you believe that there will be enough business volume to support the franchise, then it's worth moving forward.
Services That The Franchise May Offer
When you buy a real estate franchise, it's good to know what sort of services the franchisor typically includes in the package. You want to relate those offerings to the local market, and what sort of real estate business you want to pursue. Here are some examples of services that are likely to be included under the franchisor's banner:
*Real estate sales are likely to be the bread and butter for your franchise. That means listing properties, and finding buyers who will want them. See this as one service that will take up much of your time.
*Property management is another common service that you're likely to offer. Owners of residential and commercial rental properties often look for professionals who can take on tasks like general upkeep, screening tenants, collecting rent, and other essentials. If you have the skill set for that, then this can be a significant part of the monthly revenue generation.
*Property inspection services may be in the mix. This would involve assessing properties to determine what's needed to bring them in line with current codes. You may be called upon to provide this service before a property is placed on the market.
*Home liquidation is another service that you may offer. This entails buying property, then deciding what will be done with it next. The options range from preparing the property for flipping, or even razing existing structures and developing the property anew, due to a change in zoning.
Even if you have a primary focus in mind, it never hurts to know what other services fall under the banner of the franchisor. At some point in the future, you may want to broaden your offerings.
It's been said that one doesn't need to be an expert in order to buy a franchise. To some degree, that's true. Most franchisors do offer training that helps to prepare new franchisees for ownership. Even so, it's helpful to have at least a passing acquaintance with the type of business that you want to operate.
This means you don't have to be a real estate whiz in order to own a franchise, but possessing some basic information about the field won't hurt. That provides a foundation for the training, and will help you expand that knowledge base a lot faster.
When planning to buy a real estate business for sale Greenville SC or any other area, be aware that you will need to find out what sort of licensing is required within that jurisdiction. It's not just about obtaining a business license, although that's important. You may also need to secure a real estate license as well.
How do you plan to operate the franchise? Will you be hiring licensed agents to do most of the work? You may or may not need a license yourself. In other jurisdictions, you may need to be licensed as a Realtor or at least a real estate agent. Find out what will be required before you make any more decisions.
Your Initial and Ongoing Investment
A real estate franchise is not the type of venture that you can buy into for a few dollars. There is a significant financial investment on your part. While it will vary based on the type and what you need to do in order to comply with the franchisor's requirements, rest assured it will at least be in the five figure range.
Remember the initial franchise fee and related expenses are just the beginning. There will be royalties, commissions, or other types of fees that you will pay the franchisor on a recurring basis. The latter may be partially based on completed sales, but there may be fixed fees that are due even if you don't earn a penny within a given period. Make sure you're prepared to cover all those other expenses while establishing the franchise.
Do You Have What It Takes?
Finally, it pays to make sure you have what it takes to make the franchise the focus of your career in the years to come. This is not the type of franchise that you can take on as a project, then dump it a year or two down the road. Before you begin talking with any franchisor, make sure you can commit to the franchise for the long haul.
Take into account that the real estate business is tough. There's a lot of competition, and you can expect periods when people simply aren't buying. You may also find yourself in a period when there are plenty of buyers, but not many who are in the mood to sell. It's up to you to remain strong and weather any type of extreme conditions that may develop.
Finally, you need to love what you do. It's not just making money; there must be real satisfaction in matching buyers with sellers, and seeing both sides happy with the results. It's also important to realize that a happy match may or may not happen every time, and being able to live with the disappointment.
Whether it's a real estate business for sale New Orleans LA or some other part of the country, consider your options wisely. Make sure this is a field you want to enter, and that the franchise partner you are considering is offering a plan that you can honor. Doing so will help you make a decision that proves to be a good one for many years to come.