If you want to start a real estate business, you are in good company. According to the U.S. Small Business Administration (SBA), over 3.5 million small businesses in the U.S. are classified under real estate and related services. There are many ways to enter this robust market, from managing rental properties and flipping houses to joining a real estate franchise and opening a business under its umbrella, to creating a digital or service-based business, or even renting out a room in your house. Real estate attracts entrepreneurs because it is a lucrative field. Zillow reports that, as of 2025, the U.S. housing market (residential business alone) is valued at a record $55.1 trillion—an increase of $20 trillion since 2020.
Getting Started in Real Estate
Real estate is an ecosystem of interconnected services and opportunities, and you can get started without becoming a real estate broker or agent. Purchasing or managing rental properties, such as single-family homes or apartments; flipping homes for profit; investing in Real Estate Investment Trusts (REITs) or Real Estate Investment Groups (REIGs); or joining a real-estate-centric online crowdfunding platform are common business models. Another route is to open a business under a real estate franchise umbrella and bypass the usual challenges start-ups face by getting support from a parent company.
Starting a real estate business from scratch
If you’re starting a real estate business from scratch, the first step is to identify the type of real estate business you want to start. Next, it is critical to build your knowledge of the local real estate market, connect with real estate professionals in your area, and get your finances in order.
You don’t necessarily have to purchase property. Passive business options, such as publicly traded REITs, require far less capital and offer liquidity similar to stocks. Think about it, it’s much easier to sell your REITs than try to offload a home you can’t afford.
How hard is it to start a real estate business?
There is no one-size-fits-all way to start a real estate business. The challenges will depend on the chosen market niche and your experience in it. While the landscape may feel overwhelming, there are plenty of opportunities to explore, and understanding how they differ is the first step toward choosing the right direction to make the process more manageable.
Costs and Financial Requirements to Start a Real Estate Business
It’s impossible to know how much it costs to start a real estate business because it depends on the path you take. However, we can provide an overview of typical costs for getting started, whether you are considering a franchise or being a passive investor.
Below are approximate costs depending on your approach. It is possible to start a real estate business without being a millionaire—in some cases, you may need only a few hundred dollars or less.
How much does it really cost to start a real estate business?
Newcomers often ask how much to start a real estate business– the answer is “it depends.” For example, opening a management company could cost you between $10,000 to $75,000, depending on the size of your business and the properties you manage. Homeowners can start a home-sharing or short-term rental business for around $5,000 to $50,000, according to AirDNA, LLC, which provides data on the short-term rental industry. Purchasing properties requires preparation and saving for a down payment or an all-cash purchase. It can be expensive. In November 2025, the median home sale price in the United States was $438,000, according to Re/Max LLC’s data.
If you want to purchase a home to rent out or flip, you’ll need mortgage approval or cash to start out. If you take out a mortgage loan, understand that, in addition to closing costs, you may be responsible for private mortgage insurance, which typically adds 0.5%–1% to your annual loan costs if you don’t put 20% down.
The cost of starting a franchise depends on a few factors, but you could end up spending as little as $10,000 or even millions. You can use a small-business loan or a bank loan to secure financing for your business. Opportunities like investing in a REIT usually cost substantially less than purchasing a property. REITs may require $5,000–$50,000, or you can purchase REITs in a brokerage account for $100 or less. You could even start with fractional shares of publicly traded REIT ETFs for a few dollars, according to Fidelity.
Starting a real estate business with little or no money: what your options are
It is not impossible to start a real estate business with no money (or limited funds). There are a few low-capital routes that prioritize knowledge, skills, and networking over money.
- House hacking: Renting out a room in your home or part of your home and charging enough to cover all or most of your mortgage. Other ways to house hack include buying a property, living in part of it, and renting out the rest, but this will require more funds.
- Wholesaling: If you are good at networking and house hunting, this is one avenue to explore. Wholesaling properties means finding distressed or foreclosed homes, entering into a contract, and then selling the contract rights to an investor who agrees to purchase the home for cash. You get a finder’s fee for selling the rights to the home.
- Starting a real-estate focused business to help sellers or buyers: For example, home staging and digital photography of homes are two options.
Real Estate Business Models
Understanding the main business models will help guide your approach.
Real estate management businesses
If you want to know how to start a real estate management business, it is worth noting that it involves managing rental properties, handling tenants, collecting rent, and staying compliant with local rental laws. Advantages include recurring revenue from management fees, moderate startup costs, and strong long-term scalability.
Real estate investing and wholesaling
In the last decade, flipping houses has become popular. Reality TV shows about real estate, like Flip or Flop, have piqued interest in this niche industry. Often, flipping homes involves purchasing undervalued or distressed homes in strong resale markets and then selling the rehabbed home for profit. You need access to cash to start. Some beginners choose to leverage their homes using their home equity or borrow from hard-money or private lenders.
If you have the right skills, flippers can save money by doing their own work. Some high-impact renovations include painting, flooring, kitchen and bathroom updates, and curb appeal. When you flip a house, you need to make sure you earn more than you initially spend. As profits are reinvested, the goal is to increase business profits.
Wholesaling is another low-capital option in which individuals earn fees for assigning contracts to cash buyers. Wholesaling business owners require strong negotiation skills, market knowledge, the ability to find distressed properties, and access to cash buyers. Because regulations vary by state, you will need to do your due diligence.
Digital and specialized real estate businesses
Advances in technology allow entrepreneurs to explore how to start a digital real estate business and other service-based niches. For example, if you’re curious how to start a real estate photography business, you may need to invest in the right equipment, learn about real estate-specific composition, and build relationships with local agents by sharing your portfolio. Online listing, lead-generation, or transaction-coordination platforms, as well as virtual staging or marketing services, are other ways to use digital and specialized skills.
Starting a Real Estate Business Through a Franchise
According to Franchise Business Review’s Top Real Estate Franchises list, there are more than 350 real estate franchise opportunities available. Franchises allow you to build a real estate business with support and structure.
Real estate franchises specialize in different market sectors, from commercial rentals to short-term property management. HomeVestors of America and ReMax are two highly ranked examples, but there are many others in a variety of areas, from traditional brokerage and sales to property management, home flipping, and even niche markets like estate sale management.
You’ll need enough cash to cover any franchise-related costs and to be comfortable working under a larger brand. If you join one, you can gain brand recognition, training, and a robust support system, but you must operate under the franchisor’s rules for branding, operations, and business practices.
Choosing the right franchise segment for you will depend on your interests and comfort with a structured, system-driven business.
Independent vs. Franchise real estate businesses
If you are trying to choose between working as an independent business or under a franchise model, consider your experience, cash resources, and long-term goals. If you prefer structure and built-in support, a franchise could be a good choice. If you prefer autonomy over your business, it might make more sense to remain an independent owner.
- Independent businesses: Offer full control and lower long-term costs, but require you to build from the ground up, find your investors, if needed, and create your own branding and marketing materials. As an independent business owner, you don’t have to share profits with a parent company or follow a formula.
- Franchise businesses: Opening a real estate franchise provides instant operational support, structured training, marketing tools, and access to the collective purchasing power. Because they rely on proven business models, if you want to open a franchise, you may find it easier to access financing from lenders, which can help reduce start-up costs. There are a few caveats to going the franchise route; these types of businesses may limit your autonomy, and you have to pay ongoing royalty and other fees.
Funding and Support Options
Like any start-up business, being able to access cash and talk to experts can help you succeed. Because there are so many opportunities in real estate that need at least some funding to start, it’s important to have your finances and credit in order.
Financing a real estate business
Common funding options include:
- Personal savings: If you are learning how to start a real estate business with no money dedicated to the business, you may need to tap your savings to cover minimal costs, such as registering the business, marketing, or initial property research.
- Bank loans and SBA-backed loan programs: If you’re considering how to start a real estate investing business in properties, it’s worth investigating not only traditional bank loans but also any SBA programs and the U.S. Department of Housing and Urban Development’s programs to find grants or loans for homebuyers.
- Hard money loans: These loans are often used by individuals looking to fund short-term flips or wholesalers who need to secure contracts quickly, especially when speed is critical. These loans may come with high interest rates and shorter terms.
- Private investors: Partnering with individuals or groups may be an option for a real estate management business, allowing it to pool resources to acquire or manage rental properties.
- Real estate crowdfunding platforms: Those exploring how to start a real estate crowdfunding business can join platforms to invest and participate in passive-income projects.
If you want to get involved in real estate, be prepared to work hard in a competitive market. The upside? There are many opportunities to build a real estate business from scratch, and room for individuals at all levels of experience and budget. One well-executed deal, such as a first-home flip or joining a strong franchise, can lay a solid foundation for a successful, scalable real estate business. The first step is simply deciding where your interests and talents will fit best.
This content is provided for informational purposes only and does not constitute legal, tax, financial, or professional advice. Laws and regulations vary by state and individual circumstances and may change over time. Readers should consult a qualified attorney, tax professional, or other licensed professional regarding their specific situation. Nothing herein creates an attorney-client relationship.
