Your business: how to open a real estate agency

Repair and construction business Real estate agency

So, you decided to open a real estate agency. What prompted you to do this? Well, perhaps when buying an apartment or a house, you are seriously thinking about how much money you can earn just by arranging a meeting between a buyer and a seller.

Although usually such agencies are opened by former real estate agents: there is experience, knowledge, and sometimes a database (it all depends on the integrity of the former employee and the ability to protect their information by the former employer). In all cases, the decision to open your own agency seems simple and obvious. It seems enough to rent an office, buy a desk, chair and phone - and now the company is ready to earn millions. However, in reality, not everything is so simple.

To begin with, such low entry barriers have led new real estate agencies to grow like mushrooms after the rain, creating crazy competition in the industry. By the way, they just as quickly close, faced with the realities of the Rostov market. And although, as in the whole country, real estate in the regions is booming, grabbing a piece of the pie of a start-up company is not so simple.

First of all, relatively rare buyers are either so intimidated by scary stories about agency fraud that they prefer to work only with large companies that have long existed in the market, or, on the contrary, are so “cunning” that they themselves can “throw” anyone. In this regard, the position of the new agency no longer seems so promising:

· Zero fame in the market;

· High competition will force you to fight for the attention of the seller with hundreds of similar companies

· The most convenient inexperienced customers who buy apartments for family reasons, and do not want to make money on this, are likely to go to large companies (realizing their inexperience and not wanting to take risks);

· “Experienced” buyers will certainly try to “throw you away” if you don’t have a strong lawyer (the payment for the services of which, as a rule, corresponds to his professionalism). Although he, by the way, is not a panacea.

So, you still decided to go in for this business. As you might have guessed, at the initial stage you have one (but global!) Problem: nobody knows you. This means that all efforts must be devoted to creating the illusion of fame in the market. And this requires not just large, but very large investments, and above all in advertising.

Often, small companies that have not calculated their financial capabilities, at the initial stage, try to confine themselves to small modules with quotes in free newspapers distributed in mailboxes. And although the choice of publication, as a rule, is correct, but the microscopic module will only emphasize your still low status against the background of quotation bands of large agencies.

On the other hand, funds for acquiring a larger module may not be available (prices in such newspapers are often prohibitive). You can compensate for this relatively hopeless situation by placing image advertising in other newspapers.

And yet, building a reputation is certainly not limited to advertising investments. It is necessary that the declared level is supported by the quality of services provided to the client. Since the work of a real estate agency is primarily related to communication with a client, it is imperative that all your employees are distinguished by their sociability, tolerance and, importantly, endurance (often family circumstances are the reason for performing real estate transactions, so be prepared to listen to details from clients family battles).

In fact, a good real estate agent often becomes something like a psychotherapist, and this imposes a serious moral responsibility. On the other hand, as most real estate agencies note, the so-called word of mouth plays a huge role in attracting new customers - when one satisfied client brings his acquaintances to the agency and recommends it to others.

I think the importance of quality services for the status of the agency should not be further disclosed and you can move on to less elevated, but no less serious problems. And above all, this is the problem of finding personnel, namely agents.

A paradoxical situation has arisen: if in Moscow (where the market has long been redistributed between a limited number of large companies), in order to get a job in a real estate agency, it is necessary to go through a competition, and sometimes get a special education, then in the regions many companies recruit agents literally “from the street”, which automatically leads to not always high competence of employees and to a rather high staff turnover.

At the same time, individuals appear who manage to change up to a dozen agencies in a few months, without forgetting to copy their databases, or even make transactions “to the left”. So the novice agency should be afraid not only of dishonesty of buyers, but also of fraud of its own staff.

An equally important point is the collection of a database of sellers and buyers of apartments. Actually from this the work of any agency begins. The main sources of information for the database of sellers are calls to pseudo-partial pasting. In fact, with this sticking-up, most new agencies begin to create their own base.

The technique of pasting is extremely simple: by hand (or on a computer) a text is written like “The Russian family will buy (rent) an apartment in this house. Urgently. Without intermediaries. Phone ”- and sticks on all the entrances in the area. After that, it remains to remove calls and enter the sellers in the database.

Considering that, as a rule, the percentage for services is not taken from apartment sellers, almost all the "people who are on the stick" agree to leave their information with the agency. But buyers are "caught" already for advertising.

To find them, newspapers publish quotes with the best positions from the collected databases. At the same time, agencies usually do not stop the absence of such positions and the so-called “phantoms” are placed in newspapers - nonexistent apartments with an attractively low price. The main thing is to hook the buyer, and there it’s a matter of technology: to ring up all the other agencies, find a similar apartment and divide the percentage in half between the agencies. And the fact that the apartment does not appear at the time of the customer’s call is explained simply - it has already been sold.

And in conclusion about the most pleasant - the possible income. It’s easy to calculate them - the standard amount of commissions that real estate agencies charge for their services is 5-6% of the cost of housing purchased.

The most popular items are traditionally cheap guestrooms and one-room apartments. Their cost is quite predictable, which means that the possible income from the transaction is obvious.

There is only one question: how many apartments do you need to sell per month to cover office expenses and, most importantly, advertising? Count you, gentlemen, entrepreneurs!

© Tatyana Nikitina - practical information on starting a business

* The article is more than 8 years old. May contain outdated data

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