Real Estate Business Plans

The differing kinds of Real Estate business plans normally include, one or a combination of each of the real estate trading styles: Buying and selling real estate on behalf of buyers and vendors – Realtors or Estate Agents;

Property management, for or on behalf of professional landlords;

Property Investment - renovation or build of new units to sell on or rent at a profit.

Each particular business has its own peculiarities, and this should be reflected in each real estate business plan. Our sample business plans below, show outline details for 2 of the 3 most popular real estate businesses.

It is important to consider legal requirements in your real estate business plans, and it may be necessary to hold or attain certain professional qualifications before being able to practice.

It is always a good idea to consult a legal professional, a tax accountant, and have several informal discussions with existing businesses in the sector in which you want to start your business. It is surprising how open people can be once you start asking questions about something they are involved in.

Sample Business Plan

RJ Wagner & Associates Realty, Inc

Executive Summary

RJ Wagner & Associates Realty, Inc., is an S corporation domiciled in the state of Texas. This corporation is capitalized by one single stockholder and one principal investor, Regina Wagner.

Regina Wagner is a licensed broker and the sponsoring broker for this firm. The licensed broker of this firm will sponsor licensed real estate agents (independent contractors) in the state of Texas. This corporation will formalize the real estate services offered. RJ Wagner & Associates Realty, Inc., will open its doors for operation in July 2001. The office is located in Houston, Texas (Champions area) in the Greenwood Square Shopping Center, to provide services to the higher income section of Metropolitan Houston.

Credibility and reputation excel with the broker of this firm, with a published real estate book and real estate organizational programs placed in the Houston Association of Realtors and the Dallas Association of Realtors bookstores and superstores. For the past year novice licensed agents have enjoyed the organizational tools and guidance offered in the book Texas Real Estate/The Mobile Mentor.

The primary objectives of our organization are to:

Become a profitable organization allowing us the freedom of taking advantage of other real estate investment opportunities as they become available.
Recruit and hire self-motivated, success-oriented, and hardworking sales agents.
Maintain an office of at least 15 sales agents who meet the previous requirements.
Develop a solid, corporate identity in our specified targeted market area.
To establish good working relationships and begin working as a team, promoting communication and suggestions from all participants.
Become one of the top brokerage firms in operation in the Champion area by our third year of operation, or before.
Realize a positive return on investment within the first 12 months.

We believe the above-mentioned objectives are obtainable because of the professionalism of the manager and sales associates this corporation will hold.

Individuals gaining a real estate license leave school with the knowledge of the real estate laws and procedures. The turnover rate in this business is high since agents have no training outside the laws and regulations of the business itself.

Once they have a license, only then, they may obtain the sales and marketing training that is needed upon entering the profession. This training is available at a high price to the agent.

When starting out, most agents are not able to obtain this training at the high prices set forth, and without the proper training the average earnings of a beginning real estate agent is very low in comparison to industry standards.

The office environment we will be providing will be productively arranged yet inviting to the agent as well as the client. There will be a location in the office each day with a daily marketing routine/schedule to follow.

Agents have the opportunity to be guided each day through a marketing plan to gain clients. They may choose to follow the guidelines and training provided or they may follow their own daily routines.

We will be supplying a program allowing the new agents to earn more than the average real estate agent by providing guidance and stability.

If an agent with our company sets a goal to obtain only one seller and one buyer for the month, on an average of $150,000 sale on each side, would earn the agent $6,750 per month X 12 months = $81,000 per year. Regina's goal as the broker is to assist each agent in conquering this goal.

The same sales as noted above would profit the corporation $2,250 per month X 12 months = $27,000 for the year X 15 agents = $405,000. This is not including sales from the active broker of this corporation which would be $4,500 commission from each side to total $9,000 (100%) to the corporation. The broker will receive a salary from the corporation...

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Sample Business Plan

MSN Real Estate

Executive Summary

MSN Real Estate (MSN) is an Oregon-based real estate company that will offer benchmarked rental units for the Eugene, Oregon community. MSN's units will balance safety, cutting edge features, and a positive atmosphere for all tenants. These rentals will be provided with unmatched levels of customer service and attention. Sales are projected to be $430,000 in year one growing to $600,000 in year three.

The Market

MSN will target three distinct customer segments. The largest segment that they will service is University of Oregon students. This segment is growing at 7% a year with 18,000 prospective customers.

This segment is especially attractive since most of the local rental properties that are geared toward students are run down, poor quality units.

The second market segment is local professionals who are increasing at 4% and have 12,000 potential members. The last segment is faculty and staff of the University. This section has a 5% growth rate and 6,000 potential customers.

Strategy

MSN will initially focus their efforts on buying and developing existing properties. Once the properties are purchased, each unit will be hard wired with Internet access, state-of-the-art amenities will be installed, and safety measures will be implemented ensuring a cutting edge, safe environment.

This course of action will be initially pursued as a way to efficiently utilize capital and establish a reputation within the community. Future projects may include custom build outs.

Management Team

MSN will be led by Shawn Menashe and Nathan Koach. Shawn has a bachelors degree in Economics and received his MBA from the University of Oregon. Following school, Shawn went to work for one of the largest property management companies in the area. After seven years with [name omitted], Shawn had risen up to Vice President of Operations.

It was his time at [name omitted] that provided Shawn with valuable industry insight and experience. Nathan brings different skills sets to the company, coming from a customer service background. At the young age of 21, Nathan had already completed his undergraduate degree and went to work for Voice Stream Wireless.

After six years at Voice Stream, Nathan had been promoted to the Director of Customer Service for the Salem, Oregon center. In this position Nathan managed Voice Stream's 200 person customer service department. This experience provided Nathan with incredible customer attention skills that he will leverage for MSN...

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