What is real estate? Real estate consists of land, buildings, or both including plants, water bodies, and minerals. The business of buying, selling, renting, or leasing land or landed properties is called the real estate business. Depending on your financial capacity you could start a real estate business as an agent, company, or investor. Real estate agents are brokers between property owners and potential clients like individuals, businesses, and investors.
The real estate property could be divided into two: residential and commercial properties. Residential properties are buildings or lands for the purpose of home (the place where people live). Commercial properties include office buildings, factories, store buildings, warehouses, and farms.
Is Real Estate Business a Profitable Business?
The real estate business is one of the most stable businesses not just in Nigeria but all over the world because real estate properties are almost impossible to depreciate in value. This makes a viable business even as a real estate agent.
In Nigeria, the real estate industry is an ever-growing industry with abundant opportunities because of its massive population. As long as human life continues to exist on the earth, the population will keep increasing and this sustains the need for residential buildings, offices, and shopping complexes. People are on the constant lookout either to sell, buy or rent a property and they need the help of a real estate agent to make this a reality. Many smart individuals have tapped into this basic need of man to create a livelihood and legacy for themselves.
Can I Build a Career in Real Estate?
The real estate industry is among the highest contributors to Nigeria’s GDP and it abounds with great business opportunities. Starting your own real estate agency is a good career choice that will yield a massive profit when done with the right knowledge, character, and purpose. However, no good thing comes easy in life. The business-like every other has its own peculiar challenges and hurdles. It is a very competitive market with numerous old and new players but there are areas you can exploit with creativity. Do not get intimidated by the heavyweights rather identify a niche and city where you can have a competitive advantage. Focus your energy on building a trustworthy and authentic brand that identifies with and solves the housing need of people. A real estate career will be a lucrative business in the long run.
How to Start a Real Estate Business
This article is a basic guide on how to start a successful real estate business. Success in any field requires adequate information and knowledge, the real estate business is not an exception. Do you want to start a real estate business? – take the following steps:
- Define and Refine Your Idea
To have the best chance at success with your real estate idea, you need to analyze your strengths, weakness, and areas you have a competitive advantage over others. Because chances are that there are at least two existing agents or companies within your target market. Find other what others are doing and areas you can take advantage of.
Narrow your idea to a particular niche and target audience. Below are the niches you could consider;
- Residential properties
- Resort and vacation homes
- Income properties
- Commercially properties
- Property management
- Rental Property
- 2. Write a Detailed Business Plan
Although this is not mandatory it is important. A business plan is a document that describes the objectives and goals of the business. The business plan gives your idea meaning and provides quality information on how the business goals can be achieved. Research shows that persons who take the time to write a business plan are more likely to start the business and follow through with the plan than those who did not. Also, through the process of writing a business plan, you cultivate new skills that will be of great value later.
The typical business plan has the following contents:
- An executive summary
- An industry overviews
- Market research and analysis
- Competitive analysis
- Sales and marketing plan
- Financial plan
- Operating plan
- Management plan
Before you start writing the business plan, carry out thorough market research. Know what your prospective clients need, what they consider before renting or buying a property, and the challenges in their current location.
- 3. Create a Unique and Strong Brand Identity
Real estate agents and companies market their services on the strength of their personality and brand identity. Your agency’s public identity is your brand. A brand represents how the public knows your business. It is the perception of your reputation and that of your company.
One key ingredient of success in business is brand credibility especially when it involves financial investment. To build a real estate business into an authentic brand, give your clients enough value for their money and time, and engage with them in a friendly way. Invest in brand identities such as name, logo, adverts, and website.
- 4. Build an Online Presence
The internet is an essential marketing tool for any kind of business and real estate business is not any exception. Businesses are differentiating themselves from competitors on the basis of technology.
Customers decide on the real estate company to use on the basis of brand, the reputation of the owner, and the company. The first point of contact between you and potential customers is your website and social media handles. Make the first impression count with a user-friendly website. Your site visitors should clearly understand what the company stands for, the services you offer, your reputation, and qualification. The website should have testimonials of old clients and an easy way of contacting you.
- 5. Legally Register the Business
For credibility and trust, you must register your business with the appropriate authorities such as the Corporate Affairs Commission (CAC). As a start-up or someone just trying to find his feet, a business name registration with CAC will suffice if you cannot afford to register the business at the moment as a Limited Liability Company.
Other associations you could identify with are the Association of Estate Agents in Nigeria (AEAN), the Nigeria Institute of Estate Surveyors and Valuers (NISEV), and the Real Estate Developers Association of Nigeria (REDAN). This will ensure you run your business smoothly with any form of harassment.
- 6. Raise the Seed Capital
One of the benefits of a good business plan is giving you a clear minimum financial requirement your business need for it to start. You should look for alternative funding depending on the scale of the business and only when it is unavoidable.
Depending on the scale of the business, you can start without physical infrastructure. A professional online presence is a good way to start. Seek the help of family and friends for additional support before involving an investor or loan.
Remember no plan works without execution. A good plan with poor execution will amount to nothing. This includes marketing, the first contact, closing of deals, and after-sales service. Execution is your daily activity in the business. How you do one thing is how you do everything. Referrals from a customer are still a powerful means of marketing. So, let no customer leave dissatisfied with your services. The real estate business is not a sprint, it needs time, patience, continuous learning, and evolution.