Open an Estate Agent Franchise In 2019

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Estate agency franchises 2019

The average cost of buying a home in the UK rose unexpectedly by 1.1% to £222,293 in August 2018, according to the Halifax. This increase is down to record levels of employment and a lack of available properties, which goes against the predicted slowdown in the housing market that some economists had suggested.

Households are feeling the pinch in their pockets due to wages failing to keep up with inflation, but this is offset by the unemployment rate falling to a 42-year low, low mortgage rates and a deficiency in properties for sale. And with HMRC confirming that sales of homes in the UK surpassed 100,000 for seven consecutive months, the property market moving from 2018 into 2019 looks relatively buoyant, even in these times of uncertainty.

Despite Brexit, both buyers and sellers are still keeping the market moving. The average house is hovering around the £230,000 mark, and costs of around £3,300 for buyers and approximately £6,900 for sellers make the whole process the biggest single financial commitment anyone will ever make. To make the right decisions both buyers and sellers need the right advice. And for that, they turn to estate agents.

Even when the housing market gets a little sluggish, it doesnt stop people from making a good living out of property buying and selling. If you dont have the funds to invest in bricks and mortar, how about investing in a business venture to help others instead? Estate agents always make money, no matter how buoyant or soft the market. Lets have a look at how to start an estate agency using the franchise model.

Who are you up against?

Starting a business in this multi-billion-pound industry can be a challenge. What if you have no experience? How will you compete against established operators that have been providing the community with sales and lettings for years? Dominated by large, traditional high-street estate agents, how would a small business enter this mature market? One solution would be to consider one of the many estate agency franchises for sale or the wealth of other types of franchises available in this sector.

Its a good time to buy into a letting agency franchise partly due to the changes to stamp duty for buy-to-let properties that were announced by the chancellor way back in 2015 (yes, it takes that long for the trickle-down effect to kick in). A considerable rate increase for houses bought in addition to a primary residence coming into force from April 2016 triggered a bit of a buying frenzy among landlords, resulting in a greater amount of buy-to-let properties on offer.


This, in turn, has led to an increase in the number of rental properties advertised, and so more work for lettings franchise businesses. So while house sales and purchases may be a little sluggish at the start of 2019, the rental market is in even higher demand than ever.

As estate agents work in both sales and lettings, even if one part of the business is quiet it usually follows that the other side of things is busier. This is expected to remain the case for much of 2019 and into 2020 as the effects of Brexit start to take hold. No matter what happens in Brussels, though, people will always need a roof over their heads, and rather than taking a pot shot in the local classifieds, finding a rental property through an estate agency gives both landlords and tenants a better service and greater reassurance.

How to start an estate agency

You could try starting up your own estate agency, offering your services as a go-between for local sellers and buyers. Effectively, all you need is an office and a computer, so surely the investment is minimal?

Well, yes and no. While admittedly there is very little in the way of hard infrastructure needed to start your own estate agency on the high street, what you will need (and in buckets) is publicity. As we said earlier, the property business is very mature, and youll come up against well-known names on the high street such as Stags, who have over 140 years of experience and are the kings of the South West. In other parts of the UK youll encounter the same issue venerable companies with decades of experience, reputation and customer loyalty and who dominate their chosen territory, making it very difficult for any newbies to set up business on their patch.

Establishing your own estate agency will take time a long, long time. Youll need to convince both vendors and buyers, as well as landlords and tenants, that your service can be trusted to deliver a comprehensive service and that your skills as a conveyancer will ensure that everyones happy. Keeping all the people happy all of the time is the toughest trick of all, whether youre an experienced conveyancer or a relative newcomer to the industry.

How to start up an online estate agency

The alternative is to set up an online estate agency. Companies such as Purple Bricks, On The Market and Zoopla have shown that in the digital age you dont necessarily need to have real world offices to sell a property. Theyve also shown it is possible to reduce those astronomical buyer/seller fees and that buying and selling property doesnt have to cost thousands of pounds.


As we trust the online world more and more for our everyday shopping, it follows that we are now starting to trust it for those essential purchases such as our next home. To set up an online estate agency you really do need just an office and a computer, but youll still need to know how to market yourself as an estate agency. Its this that an estate agency franchisor will be able to help with if youre serious about getting into this particular marketplace and making it your career.

Our top estate agency franchise opportunities

The advantage of choosing a franchise is that not only do you have the backing of a reliable, well-known and well-trusted brand behind you, but youll benefit from their expertise and experience too. No new franchisee is thrown in at the deep end youll get all the training you need to start up an estate agency franchise, as well as ongoing support and, most importantly, that crucial advice on how to market your business.

Without powerful marketing, your business will go nowhere, so estate agency franchise put a lot of store in creating marketing techniques that work time and time again. These are tried and tested methods that have been proven to be successful. That at least gives you a good chance of holding your own against the competition.

Some of our favourite property and letting agency franchises include:

Belvoir

As well as being a successful lettings franchise, the company is currently rolling out property sales to its 300 branches nationwide. With 18 years of continuous growth, this is a franchise thats an investment worth looking at. Highly professional and customer-service focused, the UKs largest property franchise has a wealth of knowledge and expertise to offer its franchisees, providing the best possible platform for the potential business owner.

Youll need an initial investment of £45,000 and an overall investment of £150,000, so this is definitely one where youll either need substantial initial capital or a generous lender. Thankfully, Belvoir is a highly respected brand, and lenders are happy to talk to potential franchisees with loans of around 70% of the total investment value available.

With the extremely comprehensive award-winning support that franchisees receive and the estimated one million more renters that will be looking for homes in the next five years, the likelihood of making a profit is high. With a trend that indicates more than half of Britains homes will be rentals by the year 2032, this is an industry that is on track to continue to grow and grow.

Northwood

Established in 1995, this estate agency franchise for sale specialises in providing guaranteed rent, differentiating this business in what is a very congested marketplace. Where most letting agency franchises act almost like a mediator between landlords and tenants, this business is unique in the fact that it pays the landlord a fixed rental income and takes responsibility for managing the property.

The benefits that this model offers landlords includes guaranteeing an income even when a property is empty, or the tenants wont pay. This unique selling point can be promoted and used to attract landlords attention, even if there are lots of other estate agents in the same area.

It's also one of the most affordable rental letting agency franchises, with a minimum £25,000 investment and franchise fees of £25,000.

Redstones

This is another estate agency franchise for sale with a forward-thinking approach to technology to improve their customers experience. Essentially an online estate agent franchise, this company provides potential renters and property buyers with convenience and potentially cheaper fees. Although traditional high street estate agencies are still prevalent, there has been significant growth in online agencies in recent years.

With 3D floor plans, walk through technology and an online property auction service, becoming a franchisee as part of this business will ensure that youre well placed as the property letting and sales industry embraces the digital world.

A minimum investment of £14,995 and a total investment level of £25,000 all in makes this one of the best buy-ins for anyone who wants to set up an estate agency franchise on a budget.

But if a lettings franchise or an online estate agent franchise isnt for you, there are plenty of other alternatives that might be better suited. Here are a couple of options for you to think about:

Aspray


Crushing the misconception that property-related businesses need to be run from fixed premises, this property assessment and damage insurance company claims the franchise can be operated from the comfort of your own home. Aspray specialises in project managing property damage insurance claims from inception to completion of repairs, and to support customers when they need it the most.

According to the Association of British Insurers (ABI), insurers paid out an astonishing £12.9 million per day in property claims (£8.2 million in domestic claims and £4.7 million in commercial claims) in 2018. This means that there are plenty of customers who need claims support, therefore increasing the opportunity to make a profit with this growing business.

Its an affordable franchise too, with an initial minimum investment of £15,000 and a total investment sum of £37,500. The fact that you can run it from the comfort of your own home makes it very attractive for franchisees who want to keep overheads to an absolute minimum.

Agency Express

Nearly 50% of estate agency boards across the country are erected, serviced and maintained by this growing franchise. As the only national estate agency board management company in the UK, franchisees can be secure in the knowledge that theyre part of a company that dominates the market.

This is a low-cost, low-overhead van-based business with the flexibility to be run from home and worked around family commitments. Once you've purchased a van, the franchise fee covers everything needed to get the business up and running, including training, clothing, equipment and insurance. Youll pay just £12,500 investment fee, and can expect around £40,000 in revenue after two years.

Conclusion

There are many estate agency franchises for sale, as well as other property related franchises, that provide the opportunity to create a profitable business. By choosing to become part of an estate agency franchise, you can benefit from their increased buyer power for marketing and promotional activity. Their websites are very often easier to navigate, simpler to understand with more content to educate customers. They also have quality brochures, offer more varied services, and can stay up to date with technological advancements, which makes buying or renting property less of a hassle for customers.

These elements are difficult to replicate for an independent estate agency trying to establish themselves amongst recognisable brand names on the high street. So if you dont want all the hard work of setting up an estate agency on your own, why not take a look at the franchises on offer?

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