Start-Up Real Estate Business Plan

Opportunity

Problem

People live longer due to the advancements in medicine. After they have children, they can enjoy their spouse and be free from all other responsibilities. They can be carefree again. They will need to find a budget-friendly place that supports them in this endeavor.

Solution

GVRE provides real estate services for the Golden Valley retirement community, located northwest of Tucson. GVRE offers full-service title, real estate and mortgage services.

Market

Over the past two decades, the retirement market has grown steadily. The U.S. 55+ population is at an all-time high of 21%. This is growing at an average rate in excess of 3% every year. In certain parts of the country like the American Southwest, which has a high concentration of retirement communities, the growth rate is about 8%. As the first generation of “baby boomers” reaches retirement age in the next ten years, this percentage is expected to increase. The U.S. Census Bureau estimates the retirement market, which includes retirement entertainment and services as well as medical facilities and specialty equipment, to be worth 4.8 Billion dollars annually.

Competiton

The real estate market is highly fragmented with many potential rivals. Our most serious competitors are Bowditch Realty and RE/MAX. Bowditch Realty has been around for ten consecutive years. They have a proven track record of high-quality service and are a well-established business. The company currently employs twelve agents and has long-term agreements with several home-building companies. The company is slightly larger in size and market capitalization than GVRE.

RE/MAX, one of the most well-known real estate companies in the country, is the largest. It has hundreds of agents and very deep pockets that can be used to counter any sort of competitive move.

Why Us

GVRE believes new entrants are the greatest threat to the market right now, as they want to capitalize on this high growth sector. The most likely entrants are small, new realty companies with fewer that ten workers. However, the one major advantage GVRE has is its exclusive rights to act as the agent for Golden Valley Retirement Community. Due to the sheer number of competitors and low profitability of each company, competition can be intense.

Potential clients have a tremendous amount of power in this industry, as most clients are concentrated in one area. Furthermore, clients tend to “shop around” for the best package of services and cost.

Expectations

Forecast

The company expects to reach profitability in the first year and does not anticipate any serious cash flow problems. The average margin per month for each segment should be sufficient, according to our estimates. We anticipate that around one sale per monthly will result in a break even point.

Financial Highlights Year-by-Year

Finance Required

We will receive $20,000

Susan Egan $10,000

Mr. Daniel Egan $10,000