What you Need to Know About Real Estate Franchising in Canada
Real estate will always be a hot commodity, so there is never a bad time to get into the real estate business. Franchising in the real estate industry has many benefits, whether you are planning to start a franchise from scratch or you are planning to convert an already established independent real estate brokerage into a franchise location for a larger company.
With a real estate franchise, you are privy to:
- Brand name backing
- A proven track record of success
- Instant brand name recognition
- Comprehensive training
- State-of-the-art technology
- Partnerships with leading vendors
- Operational support
- Marketing and advertising support
- Lead generation support
- Group purchasing power
Scope of the industry
The real estate franchise industry isn’t just brokerages. It includes all the various tertiary industries related to real estate, like property management firms, moving companies, storage facility providers, maintenance professionals and renovation companies. When you consider all the companies that are touched by real estate, you realize just how broad of an industry it actually is.
The main segment of the real estate industry is obviously related to property and it consists of three fields: brokerages, leasing, and property management. Among brokers, there are residential and commercial brokerages, with a few that deal in both areas.
The Canadian real estate industry consists mostly of micro to medium sized businesses. There were 71,647 real estate businesses active in Canada in 2015 and 99.5 percent of those had 99 or fewer employees. The industry is overseen by the Canadian Real Estate Association.
In its 2018 Franchising Trend Report, the Canadian Franchising Association listed real estate as one of the five franchise categories experiencing the most growth. This is in large part due to some innovative approaches to the market happening here in Canada.
Our very own Gary Prenevost, President of FranNet of Southern Ontario and Eastern Canada, is quoted in the report saying 2018 is marked by the biggest trend hitting all industries, including real estate: convenience.
“We’re only getting busier – we’re working more hours, corporations are expecting more, and there’s the umbilical cord to the smartphone. People are looking at, how can I get something faster and easier, and even how can I get it to my home?” Prenevost says in the report.
Service-focused franchises like real estate sellers are especially adept at offering convenience, as Prenevost notes: “People who are attracted to franchising as a whole are looking for things that can’t be provided offshore, that are less risky, and services are probably the least risky of the different categories, when you’re thinking product and retail versus service.”
The report spotlights PropertyGuys.com as a franchise that is doing real estate differently. Since franchisees for this company aren’t technically brokers or agents, they don’t require a real estate licence to operate.
Getting Started
You’ll need to decide which area of the real estate industry you want to enter, which means deciding whether you are more interested in buying and selling property, leasing property, managing property or one of the many other side business. Regardless of which area you choose to get into, perform your due diligence and educate yourself about it as much as possible.
You also need to know your local market. If your preferred franchise company is already represented in your area of choice, you will likely have to look for a different franchise to join that is not yet in that market or switch markets.
Property management is much like other forms of management, where you’ll have to coordinate and oversee a bevy of activities and ensure everything runs smoothly. If you’re adept at management in general, you may be a good fit for property management. You don’t require any specialized knowledge to get started. A property management franchisor will provide you with the necessary training to get set up.
Starting a brokerage is a bit more complicated. The first step in starting your real estate business is to become a licensed real estate broker (unless you go the propertyguys.com route, as previously mentioned). You can easily find courses near you to study the required course work and take the licensing exam. Each province has its own specific requirements, so check with your province’s real estate commission for those.
No matter what area of real estate you want to enter, whether it’s a brokerage, property management, leasing, private sale franchising or one of the other side markets to real estate like moving or storage services, FranNet can help you find the perfect fit. Sign up for a free FranNet franchise search and consultation today and let us help you on your way to business ownership.
