Editor’s note: This article was first published in July 2010, after the property bubble burst in Spain. Its description of falling sales, banks turning down mortgages, rising rentals and home swaps being “not yet widely exploited” reflects the market at that time.
Real estate businesses are still a profitable business for people who are open to innovation and are not afraid of change. As we discussed in a previous article, the era of real estate speculation is over, since speculation is what broke the economy worldwide. Today we look at how to stay in the real estate sector.
Sales of homes, rural properties and land have fallen, but that is no reason to shut down, or shut ourselves off from, real estate businesses. Those who love speculation and want to keep investing this way will have to change how they do it, or invest in other countries where the property boom is just beginning. In these two articles we explain how to invest in property now and the countries where you can invest today:
Now, if you want to keep running your estate agency or open one, it will not be as easy as before, but it will not be a bad business either. You simply need to focus not only on sales but also on…:
- Rentals: Families still need a roof over their heads, so if a bank turns down their mortgage, that does not mean they will end up living by the railway tracks (although sadly it does happen). Rentals have increased for two simple reasons. First, owners find it impossible to sell a property. Second, and obviously, people cannot afford to buy one. Now your most profitable business is finding properties to rent out, whether to students, workers or families.
- Insurance linked to estate agencies: Most estate agencies that saw their sales fall have taken on new services to survive. Services such as working with insurers, offering property owners the option of taking out insurance against tenants who do not pay. If a tenant does not pay, the owner is covered by the insurance.
- Decoration and renovation: If you cannot buy a new home, you may have no choice but to renovate your old one, so a decoration and renovation service linked to your estate agency is always useful, whether to get a flat ready for renting or for new clients who only want a renovation.
- Home swaps: A practice that is not yet widely exploited. Imagine someone who has to move elsewhere because of a job transfer, while in that other place there is someone who urgently needs to sell their flat and buy another in the area the first person is leaving. These services are not widely advertised, so you have an active market niche to exploit. Be the first in your area.
What about investors who bought land thinking they would sell it to a developer and then found they could not sell it?
No need to panic: there are countless ways to get a return from an old house, a rural property or a plot of land.
In times of crisis, the only people who close their businesses are those who cannot think of alternatives and new ways of doing business, and who end up buried by competitors whose main asset is their thinking.
The following articles on the entrepreneurial mindset and business ideas may help you grow personally and professionally as an entrepreneur:
- How to be a successful entrepreneur
- The mindset of an entrepreneur
- A drug cartel’s guidelines applied to business
- 15 business ideas nobody has ever exploited
Featured image: Bert Kaufmann, CC BY 2.0, via Flickr.
