When I met Allison for breakfast at our favorite diner, she ordered quickly. She knew what she wanted. That’s Allison, though: someone who knows what she wants and doesn’t like other people telling her what to do. So, it wasn’t exactly a surprise to me when she said she wanted to buy a real estate franchise. She wanted to be her own boss.
Allison was ready to try something new, forge her own destiny, and take control over her life. That’s a very understandable feeling—and one that I have always had as a professional real estate investor. She had been doing some research on the best real estate franchises to buy and wanted my opinion.
Over plates of scrambled eggs and chorizo, we looked over some options based on national rankings. We talked about costs and opportunities, pros and cons. And, drank a lot of coffee.
The Best Real Estate Franchise To Buy
Allison had brought with her Entrepreneur’s Top 500 franchise list for 2019. Obviously, at the very top were ones like McDonald’s, Dunkin Donuts, and the like. Those are great for some people of course, but Allison wasn’t looking for a static business with a boatload of employees and rules from overhead. She wanted freedom.
So, it was definitely going to be real estate. Luckily, there were three in the top 32. Here they are.
- Franchise Fee: $17,000-35,000
- Costs: $40,000-230,000
- Structure: Commission splits
- Employees other than yourself needed: 2
Re/Max has been around forever. I remember when I was a kid seeing the commercials with the trademark hot air balloons, and assuming that was what these “Re/Max” people did. Not quite. Basically, when you buy into them, you buy into their network, getting the benefit of name recognition and their network of leads.
This is a model where you split your commission. You are an agent, and they are the broker. The high arrangement is a 95/5 split, which is really quite good. But, that’s only if you are paying for shared desk space and other upfront costs. This is also your split if you don’t access the broker’s resource. Depending on how much help you get, your split could be 80/20, 70/30, or even 60/40.
The best-case scenario is that you don’t get any help and do all the work on your own, at which point you get to keep almost everything you make.
- Franchise Fee: $35,000
- Costs: $184,000-337,000
- Structure: Commission Split
- Employees other than yourself needed: 3-4
Like Re/Max, Keller Williams operates on an agent/ broker model. They have a slightly different way of doing things, though. You start out every year on a 64/30 split, with the remaining 6% going to cover office fees and other costs. But that’s only for the first $100,000 every year. Anything after that is yours, though the exact number varies by office.
It’s obviously a steeper split, but you also have access to a lot of things with Keller Williams, You get a branded website and extensive training. And, you get to be part of a growing company. In 2017, they were #77 on the Entrepreneur list, moving to #22 in 2018. They slipped a little, but if you want to be part of an agent/ broker relationship, this isn’t a bad bet.
HomeVestors of America®
- Franchise Fee: $34,000-70,000
- Costs: $56,000-426,600
- Structure: Independent owner/ operators
- Employees other than yourself needed: 0
I put this one last even though it is ranked higher than Keller Williams because this is a different model. This isn’t a brokerage. You’re an independently owned and operated HomeVestors® franchisee. You are very literally your own boss here.
Basically, how this works is that you get qualified leads from motivated home sellers who get in touch with you directly based on the nationally-known “We Buy Ugly Houses®” marketing campaign. These are people who need to sell quickly, due to job loss, bills, inheritance, moving, repairs, or other “ugly” situation. This way, you get leads from people who are already ready to sell. It isn’t cold-calling. And, you make them an offer based on what you think the home is worth.
But you aren’t alone in making that decision, either. HomeVestors provides proprietary software, ValueChek®, which helps you determine what the house might be worth in the short and long run. HomeVestors also provides extensive training, including, when needed, a mentorship program where you receive guidance directly from the pros.
Unlike brokerages, you don’t need a real estate license to buy homes, fix them, and sell them. And, you don’t have to hire any employees. Anything you can do yourself, you can do yourself.
So What’s The Best Real Estate Franchise to Buy?
OK, you’ve probably figured out which one I prefer. HomeVestors is a fully developed brand identity providing some of the best tools and resources in the industry as well as ongoing support and an independent business structure. That’s the key—you get assistance and independence. For someone like me, it is the best of both worlds.
Is it easy? Not always. But, if you want to truly take charge of your life and financial future, enjoy a consistent challenge, help people who need it, and learn a lot about yourself, a HomeVestors® franchise is the best way to go.
So if you’re like me, and like Allison, you want a few things: independence, a community of like-minded people to help each other, and bottomless cups of coffee. If that’s you, contact HomeVestors for information about becoming a franchisee.
Each franchise office is independently owned and operated.