Deciding to go into business for yourself and be your own boss is a big deal, and to make that decision payoff you have to think carefully about the type of SME you’d like to run. One option that is proving popular with many entrepreneurs is real estate, and to see if it will be suitable for you, check out our post below.
Yes – Good prospects
One reason that real estate is such a popular company to set up is because of the excellent prospects it provides. After all, people are always going to need houses, and even though the property market can go up as well as down, it has been gradually increasing in many locations for years. Something that you can find out more about at https://www.cnbc.com/housing/.
Of course, success in real estate is not only dependent on the market itself but also how you run your business. One thing, in particular, to bear in mind is that realtors need to be able to move with the times to capitalize on the prospects that come their way. This relates especially to the way that they use marketing including SEO and your website itself to attract customers online. Something that Anthony Gilbert discusses in detail in his post, making it a useful thing to read for anyone considering entering into the profession.
No – You must be tenacious and thick-skinned
Despite the excellent long-term prospects, real estate isn’t a business that will suit everyone. In fact, successful realtors need to be thick skinned and tenacious, so wilting violets need not apply.
Realtors need to have such character qualities because it is a sales-based business that deals with big-ticket items. That means you are likely to come across competition from others in your field, as well pressure from your clients to get them the best deal possible. You will also have to try and try again to secure the right property at a price that will please your client, or hold out for buyers that will pay just what you are looking for. Something that means a competitive edge can be more than useful in this field.
The fact that you are dealing with a product that is so close to so many clients hearts as well means that emotional and tempers are likely to flare up from time to time. When this happens, it vital that you are able to keep a cool head, and that you don’t take this personally. Otherwise, you could be jeopardizing closing a profitable deal, or eventually, get so emotionally burnt out that you can carry on in the field any longer.
Yes – You can specialize
Although real estate might not suit everyone, there is another advantage to it that is vital to consider when considering starting up a business in this field. This advantage is the ability to specialize in a particular area that best suits your style of business or expertise.
Some realtors choose to focus on private home sales in the suburbs. Others choose to make it their business to sell well-appointed properties in vacation locations for their clients to use to generate rental income. Others still focus on commercial real estate, which can be very profitable. Especially if you have good contacts with the local business community in your area.
No – Working with people
Of course, another major factor in deciding whether real estate would make a sensible business investment for you personally is whether or not you thrive when working with others.
After all, not only will you spend a huge majority of your time on the phone and speaking face to face with your customers, but you will also need to put some serious time and effort into developing a reliable and capable team to run your business. All tasks that require great interpersonal skills and the ability to inform and influence those around you.
Teamwork is an essential part of running a successful real estate business.
That means if you’d rather be in a cubical on your own with a cup of coffee and a spreadsheet, then maybe real estate isn’t the best business for you.
Yes – Independence
Another powerful advantage of the real estate business and one that can make the decision to make it your livelihood a lot easier is the potential it has for creating financial independence, for you the owner.
After all, houses are pretty expensive things, and even though you are only receiving a percentage of the sale cost, it can still be far more profitable to run a business in this fashion than trying to generate actual products that you will then sell on.
In fact, as service industries go realtors percentages are pretty high. Something that means when the market is peaking, some serious money that can set you up for the long term can be made.
No – Threats
Lastly, it is also worth mentioning that despite being a well-established market with good long-term prospects no one has a crystal ball and so cannot vouch for a guaranteed future for in this area. The property market does rise and fall, and like any business that you take responsibility for, you can lose as well as make money.
In particular, there are new property companies that are functioning online only that are charging a lot less than traditional realtors would for their services.
This is something that could be problematic as it can threaten anyone running a traditional real estate model, and cause them to drop their prices to remain competitive. Something that would be very difficult if they continue to have the usual overheads associated with brick and mortar business such as a showroom, and the like.
In conclusion, if you are considering setting up a reals estate business you must be aware of the disadvantages and risks that you could face. In particular, ensure that it is a good fit for personality as well as your business acumen. However, remember too that it is still a market with great potential that could if you keep up with new developments, be a profitable and rewarding SME.