A real estate business doesn’t need to be complicated to be profitable. Some of the most successful real estate companies deliver one important thing clearly and do it better than rivals.
Offering one product or service that users find compelling can make for an extremely successful company. Complicated real estate business models aren’t inherently better or worse, but things can get confused or out of whack amid all those moving pieces — marketing can get unwieldy, as can managing different teams.
Let’s look at a case study of how the innovator Regan McGee built a real estate tech platform Nobul to simplify the process of buying and selling homes.
Agents Compete for Buyers
Typically, a homebuyer can’t just enter a real estate agent’s office and have agents line up to see which can offer lower rates and free services. Nobul turns things on its head by having buyers enter their criteria and budget, only to have agents competing to represent them.
Incentivized agents offer lower commissions, free services, and more. Buyers are free to compare the transparent listings and user reviews and choose their preferred agent.
Innovation doesn’t have to reinvent the wheel; it just needs to solve an existing problem in a straight-ahead fashion.
Communication is Easy
The real estate market moves quickly, and buyers and sellers need a platform to keep up with its pace. Otherwise, somebody could snap up your dream home before you even have time to put in an offer.
Nobul makes it easy to message and share pictures with agents, so everybody stays connected and informed seamlessly. Get notifications about listings that meet your criteria so well that they feel curated without lifting a finger.
Then, respond to them quickly as you need to. You need tools that work as quickly as real estate, or you’ll get left behind and frustrated.
Agents and Buyers Align
A simple business model should meet everybody’s needs. Working as a real estate agent is more straightforward and effective when the client selects them from all available options.
When the services, experiences, and rates align between the two parties, a successful deal is much more likely. Nobul uses its proprietary algorithm to leverage Big Data so buyers and sellers can connect with the right agent sooner.
When agents list their selling points transparently on the open market, everyone is free to link up with the right people for them.
Some people try to complicate real estate by looking for the perfect home with every amenity or try to time the market just right. Real estate doesn’t have to be complicated or difficult when you have the right agents and clients.
A complex business model doesn’t necessarily offer users a more compelling value proposition. Companies are wise to focus on what really matters and deliver it in a superior fashion to their rival. Nobul has managed to make buying and selling homes easier and more affordable, and if you can give your users what they really need, you’re sure to be successful too.
The best real estate business model
According to Shannon Steinberg CEO of Allied Van Lines, the best real estate business model is one that is efficient and effective in acquiring, developing, and managing properties. It should be able to generate the highest possible return on investment while minimizing risk. The model should also be adaptable to changing market conditions. She suggests, the most effective real estate business model is the team-based model. In this model, a group of professionals with different skills and expertise work together to acquire, develop, and manage properties. This team approach allows for greater efficiency and expertise, which can lead to higher returns and less risk.
There are many real estate business models, says Jason Edwards, the chair of the Agent Editor Board of Agent Advice, but one of the most popular is the agent-based model. In this model, agents act as intermediaries between buyers and sellers, helping to facilitate the transaction and often earning a commission on the sale. This model is popular because it can be relatively low-cost to start up and can be quite profitable for the agents involved.
Kurt Walker, founder of Cream City Home Buyers says that the best real estate business model is one that is built on a foundation of trust, transparency, and customer service. At its core, the best real estate business model should be focused on providing an exceptional experience for the customer that is built on a relationship of trust and mutual respect. In order to achieve this, the business model should be designed to deliver on the following key pillars:
- Transparency: The best real estate business model is one that is built on a foundation of transparency. All too often, the real estate industry is shrouded in secrecy, with buyers and sellers often feeling like they are in the dark about the process. The best real estate business model should aim to provide as much transparency as possible, from the initial consultation all the way through to the final transaction.
- Customer service: The best real estate business model is one that puts the customer first. The focus should be on delivering an exceptional customer experience at every touch point, from the initial consultation through to the final transaction.
- Relationship building: The best real estate business model is one that is built on relationships. The focus should be on developing long-term relationships with both buyers and sellers, based on trust and mutual respect.
Daniel Cabrera, founder of Sell My House Fast San Antonio says their business dynamic prefers to use the franchise model. In this model. A company licenses its brand and business model to individuals or groups who then operate under that brand. This model can be especially effective in markets where there is high demand for the company’s products or services.
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