If you’ve always dreamed of a career in real estate, you’re in luck! With the current housing boom and record-high home sales, there couldn’t be a better time to break into the industry. To find inspiration for your entrepreneurial journey, read on to discover a comprehensive list of the best real estate startup ideas!
If any of these opportunities catch your interest, remember to keep these options at your fingertips with our free Small Business Startup app—available for both Apple and Android.
House Flipping
If you’re coming to the real estate industry with a deep knowledge of construction and sales, then house flipping may be the perfect opportunity for you. When done correctly, house flipping can be a wonderful investment and extremely profitable. To determine the maximum price that you should invest in a property, many flippers follow the 70% rule. In short, this rule states that when buying a home, you should spend no more than 70% of the home’s after-repair value minus the costs of renovating the property.
Flips often happen quickly! From the time of purchase, a house is typically market-ready within 12 months, so be ready to put in long hours. Since most flips are self-financed, it’s also wise to enter this sector with enough expendable income to pay for a home in cash.
Real Estate Brokerage
From 2021 to 2022, the global real estate agency and brokerage market grew from $1,221.82 billion to $1,318.54 billion! While this market is prone to fluctuations, it can be highly lucrative for the right people. If you are charismatic, detail-oriented, and self-starter, this sector is worth exploring. Typically, brokers start as real estate agents at a firm. During this time, they develop their expertise and build their clientele. Once you’re ready to set out on your own and establish your own firm, licensing requirements will vary from state to state.
Under this business model, you provide training and marketing help for your agents and earn a percentage of every one of their sales. Typically, the owner is still selling homes themselves as well for an additional income boost.
Property Management
In 2020, the market size of property management in the United States reached $99.5 billion. And, in just one year, the market grew to $101.3 billion in 2021! Typically, investors who own rental properties often have little to no time to manage the day-to-day operations or tenant needs of their residential or commercial spaces; that’s where property management comes in. As a property manager, you will be in charge of filling vacancies, interview prospective renters, oversee repairs and upkeep and collect rent. Your earnings are usually calculated as a percentage of the monthly rent that is collected. To get started in this field, earning a real estate license and/or a property management certification are both excellent choices.
Vacation Rentals & Short-Term Rentals
Rather than managing someone else’s property, you could invest in a vacation rental of your very own. In 2021, the global vacation rental market size was estimated at $74.64 billion. By 2022, it is expected to reach $82.63 billion. As a vocational rental owner, you should aim for no less than a 10% return on your investment. In other words, your income minus expenses (operating costs including mortgage payments) should equal no less than 10% of your initial investment each year. To succeed in this market, you’ll need a sizeable amount of money to invest in purchasing a new home or condo in a highly desirable destination. Marketing on Airbnb and Vrbo are always wise choices! Or, if you don’t have time to market and manage the property yourself, you can always hire a property management company to do it for you.
Break Into the Real Estate Industry Today
We hope this guide helps you start imagining some of the ways you might break into the real estate industry. Launching your own business is an exciting opportunity, and we know you’re probably eager to get started. But remember, take your time to explore all your options. Yes, you always have the “opportunity” to start a small business, but sometimes, it makes more sense to invest in an opportunity that already exists and doesn’t require you to do all the heavy lifting alone. These are called “Franchise Opportunities.”
If you’re ready to explore your options, we’ve handpicked a few real estate franchise opportunities, below! Remember to download the free Small Business Startup app to keep all these opportunities at your fingertips—available for both Apple and Android.