Real Estate Business | Become a Tycoon in 7 Steps

The market size of real estate was $200 billion in 2021, which is expected to reach 1 trillion US Dollars by 2030. 

 

Starting a real estate business can be rewarding. Here is how you can get into the real estate business in India.

 

• Get into residential development
• Build commercial properties
• Become a property broker
• Become a real estate investor
• Get into leasing.
• Buying and selling plots
• Renovating and Reselling Property

 

For all of the above, you need to follow these steps.

 

Step 1 - Market Research 

 

For this purpose, you must do complete in-depth research about everything in this industry. 

 

For example,

 

• What is the market size ?
• Do you have the skills for this business ?
• What is the profit margin in each business?
• Which business type suits your interest and budget?
• Which is the best location to set up the office?
• Which market do you understand the best ?

 

For the best understanding of the real estate market :

 

• Analyze why the properties you know of have been successful
• Analyze why some of the properties have failed
• How do builder get their first customers
• What is tenant quality important in the long run.

 

For the research, you can consider taking input from industry experts.

 

Moreover, they will be happy to share their journey unless you come across as competitors. After all, nothing's better than hearing from the horse's mouth.

 

Besides, market research is crucial to deciding on a business strategy and financial and operational planning.

 

After research, pick a speciality and focus on that to expertise and expand.

 

The most important things in the real estate industry are trust and connections.

 

So, while researching, do not forget to reevaluate your circle and make potential connections on the go.

 

Step 2 - Business Planning

 

Next comes effective planning.

 

So, before starting the operations and legal registration, you must know what you are doing.

 

Accordingly, use all your research in planning the business goals, mission, vision and activities.

 

Also, prepare an estimate of your owned funds to figure out how much you will need from other sources.

 

Additionally, decide on a legal business structure, name of your firm, power-sharing and profit ratio. 

 

Having a business plan will give you directions to begin the business activities.  

 

In other words, it will guide you with investments, operation, niche and marketing.

 

Of course, you can anytime improvise and modify your plan to expand.

 

Step 3 - Business Registrations

 

For this purpose, you might need to get in touch with a legal consultant. StartEazy helps you to run your business like a well oiled machine. Get in touch now by filling up the form on your right.

 

With the introduction of new laws for the real estate industry, it has become crucial to do all the legal registration. It is to ensure that your business runs without any conflicts.

 

Besides, for a real estate business, it is recommended that you go for a structure with a separate legal identity like:

 

• Private Limited Company Registration
• One Person Company 
• LLP (Limited Liability

 

It is because of the many liabilities and risks in the real estate business.

 

Moreover, keeping your paperwork clean will increase your business reliability and professionalism.

 

Above all, you will rarely find any real estate agent who is working without registration these days.

 

Step 4 - Real Estate Agent Registration and Other Licenses

 

The government of India had made it mandatory to get a Real Estate Agent License before starting this business.

 

The license is issued by the General Deputy Commissioner.

 

However, it has to be applied offline with the Real Estate Regulatory Authority (RERA) of the particular state.

 

Accordingly, the fees vary from state to state.

 

Generally, the fee is around Rs.25,000 for Individual and Rs.50,000 for a Company.

 

Documents Required for Individual Registration

 

• Passport Size Photograph.
• PAN Card.
• Aadhaar Card.

 

Documents Required for Registration by Company

 

• Company Incorporation Certificate.
• CIN Number.
• PAN and TAN.
• Brief about business activities.
• Passport Size Photograph all partners/directors.

 

The validity of a Real Estate Agent License is 5 years.

 

Thus, after the expiry, the individual license is renewed for Rs.5000, and the Company License is renewed for Rs. 10,000.

 

Further, you will also need to get the following licenses:

 

• GST Registration
• Shop and Establishment Act Registration (for office premises)
• Trademark Registration (to protect brand name)

 

Step 5 - Funding

 

The investment in the real estate business will mainly depend on the type of business you choose.

 

If you will act as a broker, you require a minimum of Rs. 1 lac- 2 lac to set up your business initially. Such as setting up an office, making connections and hiring a few people.

 

Also, you will not need to invest much in setting up an office as you will initially require a small cabin only for meetings.

 

However, if you go for any other, you will need a minimum of Rs.25 Lacs.

 

To clarify, you will need funds to buy a place in India.

 

After that, you can resell it at higher prices and earn a profit.

 

And this process will go on continuously.

 

Although, this business might seem hard. 

 

But, once you learn how to start a real estate business in India, you can make plenty of money.

 

You may either self-fund yourself if you have enough. 

 

In the meantime, you can also consider the following options for investment:

 

• Business Bank Loans
• Investors
• Real Estate Investment Trust (Brookfield REIT)
• Hard Money Lenders
• Partnership

 

Step 6 - Building a Team and Networking

 

It is a very important step as without building a team, you will not be able to carry out your business activities.

 

The team depends on what real estate activity you are getting into.

 

Of course, you cannot do everything yourself, and you do not need to mass hire initially.

 

You will need the following people:

 

• Accountant
• Sales Person
• 2 Helpers to manage, show and clean the properties.

 

Further, when you expand you can hire as per your requirements.

 

Last but not least, networking.

 

As I told you in the beginning, the real estate business can thrive with a good network.

 

Therefore, connect with the people in your industry and start building up your portfolio.

 

Moreover, to increase your reach you should take your business online.

 

Register with NAR (National Association of Realtors)

 

NAR-INDIA is a national umbrella group that represents the interests of thousands of realtors/brokers across the country. 

 

The goal of NAR-India is to raise the standards of practice in the real estate brokerage industry to a worldwide level.

 

Their ethics are transparency, accountability, the rule of law, and good governance reign supreme.

 

The following are the advantages of NAR-India membership for Realtors:

 

• The beneficiary of the realtor gets a trusted image in India.
• Opportunities for national and international business networking.
• Consumer reliability in both local and global markets.
• Local businesses get international exposure by listing themselves in the global market.
• Skill development opportunities through numerous educational programmes and conferences.
• A platform for resolving real estate conflicts.