Setting Up An Estate Agency In The UK

Your Estate Agency

Posted under Estate Agents Business Website Start-up

So, you're wondering how to set up an estate agency. Possibly due to rising house prices and a buoyant property market, or maybe it's a long-term ambition. But - where to begin?

We recommend you start with our complete guide to setting up your own estate agency in the UK.

The benefit to you? A handy checklist to refer to – a step-by-step guide to establishing an estate agency.

Table of Contents

  1. Get Organised!
  2. What type of Estate Agent are you?
  3. Experience – don’t set up an Estate Agency without it
  4. Plan to succeed
  5. Try franchising – lower the risk
  6. Finances
  7. Day-to-day business
  8. Marketing Plan – attract your target market
  9. You're Ready To Launch!

Your Step By Step Guide for setting up an estate agency

1. Get Organised!

Sounds simple right? Start by making a pact with yourself to start with a sound organisational system.

Use a task management tool such as Monday.com to store and categorise your research and findings. Monday is an easy-to-use, intuitive system that allows you to keep all your thoughts and developments in order as you work towards setting up your own estate agency.

screen shot of agent extra monday.com table

Creating an organised file structure might not be as straightforward as you think. Here are some handy pointers:

Be consistent with your file and folder names

You might use underscores or spaces as part of your filing system – but try not to mix the two. Spaces can cause a technical headache when saving and opening files in different systems (not all systems recognise spaces). Sticking to underscores is probably safer unless you've got a good reason to use spaces.

Clarity matters too

Naming your folders with clarity helps avoid those moments of confusion about where a file might be hiding. For example – naming your folders' communications' and 'mailings' might mean you duplicate where you save your marketing documents or can't figure out where you've saved that critical file!

Generally speaking – the top-level files can be broadly named (e.g. Communications), so long as the files a level down are more specific (e.g. Sales Mailings, Emails, Newsletters).

Structure your templates

Maybe it's just you right now, at the start of your journey, setting up your estate agency. You know where everything is, how it's structured and where you'll find everything.

Planning forwards – once you've launched and are on the road to success, it’s likely you’ll be looking for support.

Start with a template for folder and subfolder layout. Then once you're working with your team, you'll find it much easier to navigate.

Don't be afraid of change

As technology progresses, so do the opportunities to streamline your organisational methods. Keep an eye on apps or systems that might support your company's work.

That said, it's worth creating a system that clarifies where items are saved and found, using the methods we've highlighted.

Document your evolving processes

As you build directories and establish processes for creating, saving, and editing files, document every step and decision. This will help to remind you of certain processes or conventions, but also help new employees, or third-party service providers you've hired to understand how things are done. Tools such as Trainual are great for having all your documents, policies, processes, etc. in one location, where they can be accessed by everyone in your team.

2. What type of Estate Agent are you?

You might already have a good idea about what type of estate agency you want to open. If you haven't yet made that decision, do your research.

Estate agents typically specialise in:

  • Residential sales
  • Residential lettings
  • Commercial sales
  • Commercial lettings
  • Rural estate

Finding the answer to this question will involve asking yourself questions to determine what type of estate agency you will be.

3. Experience - don't set up an Estate Agency without it

Have you been working as an estate agent? Then you're already familiar with the trade. If estate agency is new to you, you'll be wondering about the best way to gain experience. There are several options available to you, including:

  • Take a degree course in estate and property management. There are plenty to choose from – each giving you the knowledge you need to set up your estate agency.
  • Sign up for a certificate course program. These courses generally take about three months to complete. Look for a course accredited by recognised bodies such as Propertymark, the INEA (Independent Network of Estate Agents), or NAEA (National Association of Estate Agents).
  • Apply for a trainee estate agent role. They’ll pay you a salary while learning the ropes and the trade tricks.

4. Plan to succeed

business plan title on paper

The first rule of business – you must have a plan. Your plan will hold you accountable, give you focus and keep the momentum going.

Creating a business plan in the fast-paced and competitive world of estate agency is paramount to the success of your business.

We can help you to create your dynamic business plan. Once you've got the basics in place, you'll want to start to consider ways to strengthen it:

Your USP

What makes you stand out from the crowd? Is it the niche area of estate agency you're focusing on? Perhaps it's something about you personally that gives you the edge. Does the area where you're looking to set up as an estate agent have unique properties? Identifying your USP in setting up your estate agency adds value to your business plan.

Choose your location

Choosing your location is vital towards understanding your competition and chances of success. Research carefully to identify the areas already saturated with estate agencies and where opportunities might lie. If you are considering setting up your estate agency, you might find a more lucrative part of the country to target.

Once you've identified an area or areas to focus on, it's time to conduct a competitor analysis to give you insight into the competition in that particular place.

Who is your audience?

Are you going to target landlords, individuals, or retail? As well as carefully choosing a location and a specialism, consider your audience and how you plan to reach them. Lead generation is the lynchpin of your business. Without clients, the best-laid plans won't get you very far.

There are many ways to attract the business you're looking for. We've got 21 ways to generate quality leads to give you a helping hand.

Strengths and weaknesses

More commonly known in the business world as a SWOT analysis – this is your opportunity to understand both what your business might do well and where to improve.

We'll support you in carrying out your SWOT analysis. Don't be afraid of this part of your business case process. It's beneficial to have a clear understanding of where your strengths and weaknesses are.

5. Try franchising - lower the risk

Are you daunted by the prospect of setting up your estate agency independently? Perhaps you prefer the idea of a franchise – someone else's established business model – packaged ready for you to use straight from the box.

The 2018 NatWest Franchise Landscape report states that in the UK, less than 1% of franchise businesses fail each year, with 33% of franchisees owning more than one franchise. The British Franchising Association states that 91% of franchises operate profitably. Impressive figures.

Of course, there are pros and cons of becoming a franchisee:

Pros

  • You're your own boss with the added support of a reputable, established agency
  • Benefits include a proven business model and often a well-known brand name
  • Strength in a recognised brand when approaching a lender with your business case

Cons

  • Initial investment fee of between £10,000 - £20,000
  • Monthly management fees of between 7 – 12% of your profit
  • Commitment to a minimum five-year relationship with your franchiser

6. Finances

We've discussed research extensively throughout this step-by-step guide to setting up your estate agency. Trust us - the research you do now will prepare you and give your business the best chance of success.

Let's look at finances – a good relationship with a reputable financial advisor will pay dividends, both figuratively and literally. They’ll help you understand the options for funding your business and financial forecasting (short, medium and long-term).

Funding

Very few businesses start with total funding. You'll need to think about the funding route that’s best for you – the down payment could come from family, friends, crowdfunding, a bank loan or home equity. You and your funders need to understand the financial risk involved in establishing a business.

As a new startup, traditional lenders might not offer the interest rate you're looking for or the level of investment. You can always consider online lenders and credit unions as alternatives.

Lenders will consider your credit score, affordability and location when deciding on investment and terms.

Setup

Consider your setup costs – setting up a brick-and-mortar estate agency requires a significant outlay. It's better to overestimate than underestimate and find yourself running out of money before opening.

Establishing yourself on a high street or other prominent location will be your biggest startup cost, followed by wages and business rates. Setting a marketing budget will help you promote yourself optimally. Don't forget to include insurance in your calculations.

Insurance

Human error is a natural feature of life – it’s vital to protect yourself and your business with the correct level and type of insurance.

Professional indemnity

Professional indemnity insurance protects your business from any legal costs or damages arising from negligence or breach of professional care.

The National Association of Estate Agents (NAEA) says any agent wishing to include their propertymark-protected logo must have professional indemnity insurance relative to the services they provide and their annual turnover. The property mark offers protection for your clients, similar to the ABTA mark travel agents use to give their customers peace of mind.

You'll have cover for issues that include:

  • Misrepresentation
  • Employee gross misconduct
  • Data protection breach
  • Defamation
  • Intellectual property issues

The minimum level of professional indemnity insurance for NAEA is £100,000. Use that as a guide – think about what could go wrong, the worst-case scenario, and the associated costs. That's the level of insurance you require – more is always best.

Public liability

Your office will see a lot of footfall through the door. Every day your employees will be in and out of the building. They'll also be out on the road. If members of the public are injured as a result of your business activities, then Public liability will cover any compensation due.

Employer's liability

This one's a legal requirement for UK businesses. You're covered if one of your employees is injured at work. Work with an insurance advisor to decide the employer's liability insurance level you require.

Office and property insurance

This is everything in your office- desks, computers, plants, coffee machine – it adds up quickly. Portable property insurance covers your equipment – laptops, phones etc., while you're out of the office. It's too easy for a phone to slip out of your hand or a laptop to slide off a car seat. With property insurance, you'll have nothing to worry about.

Forecasts

Your forecast should be as accurate as possible. Use SMART (Specific, Measurable, Achievable, Relevant, Timely) goals to create a financial forecast for your estate agency.

Help your business follow a feasible growth trajectory by setting short, medium and long-term financial goals as part of your forecast. Your location, speciality (lettings, sales etc.), customers, and competition will shape your goals.

Look at competitors to strengthen your financial forecast. Understanding what they do well and areas for improvement will help guide you.

7. Day-to-day business

The day-to-day running of your estate agency might not be something you're considering just now but spend a little time thinking ahead so you're prepared and ready.

A solid Customer Relationship Management (CRM) system will help you keep an accurate, real-time record of your marketing, customer contact and sales data. There are many options, so we've saved you time by bringing together six of the best CRM systems – as a bonus – they're all free!

Streamlining your CRM system means no more confusion about who called who and what was said – you and your team will know exactly where you're up to, resulting in better customer relationships and ultimately increased sales.

Lead Generation

Your sales calls are an essential aspect of setting up your estate agency in the UK. For some, especially those with a sales background, these calls don't present too much of a problem. For others, making cold or conversion calls leaves them feeling uncomfortable. Using a lead generation service that integrates seamlessly with your CRM system means you'll see an uptick in sales and productivity. A worthy investment.

Social Media

Plan your social media activity effectively, and you'll maximise your budget. A tool such as Hootsuite gives you control over your choice of platforms – including Linked In, Facebook, Instagram and Twitter.

You'll be able to plan, decide on your target audience and have a clear focus for your posts and engagement. It'll also enable you to figure out which platforms work best for your audience as part of an adaptive social media plan.

Daily tools – keeping your business on track

Let's also take a moment to consider the tools you'll need for day-to-day business.

Transport

Will you require one vehicle or several? Your employees will need a reliable method of transport, and if you display your company details on them, your cars can double as practical marketing tools.

Technology

Investing in your computer equipment might seem like a costly initial outlay. But, using up-to-date technology will give you easy integration for your apps and systems, as well as a smoother experience. Choosing one provider (Google, Apple etc.) and selecting their items such as laptops and mobiles is advisable. The synchronisation between them will be simple, and the software will work on all your devices.

It's worth shopping around for a good deal with your service providers. Your business bank account might also include packaged incentives.

8. Marketing Plan - attract your target market

So, you've followed all the steps in this plan and are almost ready to go. You've thought of a perfect name for your estate agency, and your location is prime. Now all you need is clients and customers. Let's talk about your marketing plan.

A great marketing plan, ready for your launch, gives you the best possible chance of success. It's a roadmap for reaching potential clients, converting them to paying customers and ensuring consistent communication. Your customers need to know exactly where you are, what you do and most importantly, what you can do for them!

Think back to your USP. What makes you stand out from the crowd? That's your starting point for your marketing strategy. Your messaging needs to be clear and concise – you want it to define who you are.

Marketing Strategy

A good marketing plan has an integrated marketing strategy. Your marketing plan will be the logistics of specific campaigns. Your marketing strategy will be your long-term vision that incorporates your values and company ethos.

4 Ps

Giving your marketing plan definition is a lot easier using the 4Ps – Price, Product, Promotion, and Place. Let's break them down:

  • Price – What are you going to charge? As a result of your pricing strategy, how will customers view you?
  • Product – What are you selling? Properties? A letting service? Property management?
  • Promotion – How will you let your potential customers know who you are? What strategies might you choose, and how will you analyse their effectiveness?
  • Place – Where are you going to promote your services? Are they where your target customers go to find out about estate agencies like yours?

Know Your Competition

We know, more research! We can't stress the importance of knowing how your competitors reach their customers. Do they network? Maybe they have a solid social media presence? Is there an opportunity for local advertising?

The more you understand your competition, the better your chances of being one step ahead of them.

Your Website

Your website is likely to be the first place your customers experience your estate agency (unless they walk in the door, of course!). Check out award-winning estate agency websites for inspiration!

Make sure it's clean, easy to navigate and a pleasurable experience. The copy on your site needs to be engaging and concise – it's worth considering a web designer and copywriter to help set up your site. Do not rush the planning. Get in touch with an SEO agency as the research they find will help influence how the website is structured, and what content should be provided. If you skip this part, you run the risk of further down the line having to spend more on restructuring big chunks of the website.

Another factor you might want to think about is the accessibility of your site. Make sure your site can be accessed by those who are hard of sight with features such as text-to-speech and ALT image descriptions.

Time Honoured Tradition

Don’t neglect ‘old school’ methods – door-knocking if you're so inclined, phone calls, or perhaps a mail drop. Introduce yourself, and keep the tone light.

If you're new to the area, your business will help boost the local economy. Even if the people you reach out to now aren't ready to use your services, they might just know someone who is.

Google Ads

You're likely to have limited email contacts as you set up your estate agency. Still, Google Ads might help you bridge the gap, reaching out to potential clients with targeted advertising. Take time to learn more about Google Ads and use them to grow your business.

9. You're ready to launch

All your hard work in setting up your estate agency is about to come to fruition. You're ready to throw open the doors and let business flow!

Here are a few reminders to keep you on track in the hype and excitement of your launch.

Opening Day

Last-minute jitters on opening day are inevitable – With all your local promoting, you’ll have created an of intrigue and interest as the new business opens in the area. Locally people will want to know you and your staff as much as they want to learn about your business. Be proud!

Last-minute checks:

  • Make sure everything is working and fired up and ready to go.
  • It's all in the detail – water that plant, clean the bathroom, make your estate agency a place your customers want to spend time.
  • Staff knowledge – make sure your staff feel ready to offer the best possible customer service
  • Smile and relax a little – you've worked hard for this moment.

Keep Communicating

Here is where your marketing strategy comes into practice in force.

Your prelaunch marketing is complete. You're now ready to promote your estate agency by following the marketing plan you created.

Use your CRM system to record analytics from your marketing. You'll start to understand what's working for your estate agency and what might benefit from a slight tweak.

Keep it real. A great way to keep in touch with customers or potential clients is to give them insight into your business – a peek behind the scenes, fundraising endeavours, your environmental ethos – it's easier to stay connected more regularly with a soft touch.

Patience and Persistence

You've put blood, sweat, and tears into setting up your estate agency. Success might not happen overnight – in fact, it's improbable. What matters now is persistence and a little bit of patience.

Be consistent and creative in your marketing – an introductory offer or valuable insight that puts you ahead of your competitors gives you the best chance of success. We're rooting for you!

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