The 4 Critical Foundations Every Real Estate Business Plan Needs

The 4 Critical Foundations Every Real Estate Business Plan Needs

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April 14, 2023
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Elm Street Technology
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Education & Best Practices

A real estate business plan is critical to successfully launching a real estate business, or, if you're already working, taking your business to the next level.

But, real estate business planning is tough to do without knowing the key areas to focus on, so in this article, we'll outline the four critical foundations every real estate business plan needs, and give you tips on how to get started mappening each of them out.

Real Estate Business Plan Foundation #1: Market Analysis

A real estate market analysis is a good, hard look at the state housing in the communities you're looking to serve, plus an examination of the real estate professionals already working there. By completing this analysis, you'll understand what sort of homes are selling, where they're selling, and who's helping to sell them.

In doing so, you'll also uncover gaps. For instance, say your analysis shows that vacation homes are a popular purchase in your market. Yet, there are no Realtors in your area that specialize in this sort transaction? This is an opportunity!

Get Started Today: Using your local MLS, pull together a list of all the completed transactions for the last year. Look for the trends you see. Not an agent yet? Connect with the brokerage you're planning on working with to have them pull you the data.

Real Estate Business Plan Foundation #2: Identity

Who are you as a real estate professional? What sort of business do you want to run? What type of clients do you want to serve? Remember, there's no such thing as a top-producing all-purpose agent. The highest volume professionals have a specialty; they have an identity. Who will you be?

Get Started Today: Remember that market analysis you did in step one? If you don't quite have a handle on who you want to serve or how you want to operate, use that market analysis to get started. Look for places that are over-saturated and avoid that direction. Look for segments of the market that are under-served and move in that direction.

Real Estate Business Plan Foundation #3: Lead Generation

In order to make money, you need to close deals. In order to close deals, you need to have clients. In order to have clients, you need leads to convert. Every successful real estate business starts and ends with a lead generation strategy.

But, leads aren't all generated the same way. You can generate leads by asking for referrals, or by driving organic traffic to your blog, or by running social campaigns, or by buying leads from a lead gen service, or a million other ways. The point is, everybody's temperment, resources, and availability are different, so there's no one-size-fits-all strategy.

Get Started Today: If you're like most people, you're often long ideas but short on time to execute them. That's why we LOVE the lead gen options available through Elm Street. We've got websites, PPC advertising, concierge follow-up services, and a ton more. If lead gen has always been a question for you, we've got an answer we'd love to share.

Check out Prospecting Lead Gen Options

Real Estate Business Plan Foundation #4: Resources

We're going to go out on a limb here and guess you don't have unlimited funds available to you to operate your real estate business. If you did, you'd likely not be doing what you're doing.

Money management, and how your financial resources are applied are extremely important questions that not enough Realtors ask themselves.

But, they're not the only resources you have to manage. You also have your time (finite for everyone!) and your energy. You can't be everywhere at once, and you can't execute on every idea at once. So, having a clear heirarchy of where you're going to spend yout money, your time, and your energy is critical.

Get Started Today: This one is easy, and it involves working backwards. Start by asking, "What sort of resources do I need to execute my LEAD GENERATION plan?". Allocate. Then, ask, "What sort of resources do I need operate with the IDENTITY I've chosen?". Allocate. Then, finally, double-check this allocation against the market you're serving. Does your plan line up with the market at large? If so, you've done it.

Get a Business Plan Template

Ready to take this conversation a step further? Elm Street has a real estate business plan template that takes these conversations deep, and allows you to start mapping out, in detail, what it will take to get your business to the next level. You can do it. Elm Street Technology can help.

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