real estate business plan

10 Things Your Real Estate Business Plan Needs (FREE Template)

From the moment you receive your real estate license, you’ll learn that having a business plan is key to your success. But what does a real estate business plan actually include?

In this blog post, I’ll cover 10 essential items that every real estate agent’s business plan should have. Plus, I’m giving away a free template so you can get started right away!

So read on to learn more.

Real Estate Business Plan Template

The real estate market is constantly changing. The only thing you can control is your actions. Having a well-defined plan will not only set you up for success but also give you a sense of peace knowing there is some order to the typical chaos in the real estate industry.

With my free business plan template available for download below, you’ll have everything you need to start creating your real estate business plan.

Below, we’ll go through each tab of the spreadsheet.

Real Estate Business Plan Goals (Executive Summary)

The first thing you should do for your real estate business plan is to make a list of goals. This could be in bullet format or a written paragraph.

This is your executive summary. I like to think of it as my napkin presentation. If someone asks what I’d like to do this year business-wise, I should be able to explain everything on one napkin. Your executive summary will do this for you.

A business goal can include your: finances, transactions, social media, target audience, client relationships, marketing strategy, education, or personal development.

Your goals need to be specific and measurable. Below is an example of my recent goals:

spreadsheet with business goals in my real estate business plan spreadsheet

Sales Transaction Backlog (Commission Tracker)

Maintaining a transaction backlog of the deals you close is key to achieving your goals. Additionally, knowing what you’ve already done is crucial for forecasting what’s possible in the future.

If you don’t have one to two years of your transactions tracked already, gathering this data may take some time.

If you are a brand new real estate agent, this tab will be blank until you start closing deals.

The COGS column stands for “Cost of Goods Sold.” Use it to document referrals you give to another real estate professional or if you have to give back some of your commission on a deal.

If you enter your name in cell “T3”, then anytime you type the agent name as your own in column D, the spreadsheet will automatically assign the commission to either your personal or real estate team income.

A spreadsheet with data

Gross Commission Income By Year

In a new tab, transform all the data from your transaction backlog into a table. This involves an advanced spreadsheet skill called Pivot Tables.

A spreadsheet to track income by year in my real estate business plan

You’ll notice in my table I separate “Team Income” and “Personal Income.”

Below you can see the same Pivot Table broken down into months and quarters. Breaking your data down into smaller increments can help you focus on the months and quarters that are most important for your business.

A spreadsheet to track income over the years

Gross Commission Income By Source

This tab allows you to analyze the effectiveness of your efforts and track your return on investment with different sources, such as Facebook Ads and referrals.

Once you’ve used this spreadsheet for a couple of years, you’ll be able to click the “+” sign to expand your data and compare your sources year-over-year, like in my example below.

A spreadsheet to track income by source

Volume By Lender Tab

In this tab, you’ll find your transaction volume sorted by the lender that closed the transaction.

Having this data is important to track which lenders you are working with the most. This could help set up co-marketing agreements.

You’ll most likely want to filter out the listings since you are not typically referring business to the lender as the listing agent. To do this, click on the Pivot Table and go to the right-hand side of the spreadsheet to filter by buyers and listings.

Profit and Loss Planner

Keeping track of your income and expenses is not just important for tax deductions, but also for business planning.

You can use the “P&L Planner” tab within the Business Planning spreadsheet. Or use a separate program like Quickbooks Online to track your income and expenses, and create a Profit and Loss statement.

Some of the most important expenses to track include:

  • Marketing and advertising
  • Your real estate agency fees
  • Supplies and equipment
  • Technology expense
  • Labor (contractors and employees)
  • Training and Dues
A spreadsheet to track profit and loss in your real estate business plan

Using Quickbooks Online

If you are using Quickbooks Online to create your profit and loss statement, the first thing you’ll need to do is create your chart of accounts. Your chart of accounts is simply the different categories of income and expenses you make in your business.

For more information, check out my post on Quickbooks for real estate agents.

A list of income in Quickbooks

Annual Real Estate Business Plan

The “Business Plan (Annual)” tab is where you’ll analyze and forecast all of the most important sales and income metrics for your real estate company.

The left column holds all the actual numbers for your business in the current year. If you are using Quickbooks Online, you can copy over your information here. Otherwise, you’ll need to go through bank and credit card statements and categorize your expenses before manually inputting them.

The spreadsheet consists of editable green data cells and white data cells, which indicate numbers that have been calculated by the Excel formulas. You don’t need to change the data in the white cells unless there’s a specific reason.

There are five main categories included under the Business Plan (Annual) tab:

  • Transactions
  • Buyers
  • Listings
  • Lead Generation Sources
  • Expenses
  • Net Profit/Margin
  • Met/Haven’t Met Database

If you want to include other categories, you can add rows into the spreadsheet, but keep in mind this could interfere with the formulas the spreadsheet is using.

A spreadsheet with different data

Met and Haven’t Met Database

Your “Met Database” includes all the people in your personal and professional life who already know and trust you, like current and past clients and referral sources.

On the other hand, your “Haven’t Met” database consists of people you either haven’t met or seen in a very long time. This includes internet lead generation, past acquaintances, and people you haven’t met yet but who could be an ideal client.

A spreadsheet to track leads

What you do with your “Haven’t Met” Database is up to you. There are many ways you can reach this target market. You can create a marketing plan, call them periodically, or try taking them out to lunch or coffee.

Of course, as more people become your client the number of contacts in your Met Database should ideally go up.

Organizing Your Databases

I like to break up my database into these two categories because I know that my conversion rates for these two primary lead generation sources stay about the same year-over-year. For example, I typically close roughly one transaction for every six people in my “Met” database.

Keep in mind that the conversion ratio for your “Haven’t Met” database can vary widely depending on the sources of your lead generation.

By factoring in your conversion rate (in the example above its 6.8%) and your desired net profit (in the example it’s $200,000), you can figure out how many people you need to have in your Met Database to reach your goal. Excel will do the math for you, but you will need to have it recalculate if your conversion rate changes.

The auto-generated column in the middle will show you the number of people you need in your Met Database. In the example, it’s 533. That means you will need to add 107 new potential clients into your Met Database to meet your goals.

As you enter the new year, dedicate your efforts to meeting that number, if not surpassing it.

Forecasting Your Real Estate Business Plan

Once you’ve entered your data from the previous year, go to the “Next Year (Auto)” column. For this part, you’ll input your goal “Net Profit,” and Excel will calculate all of the other metrics and show you which ones you need to reach your goal.

Next, go to the “Next Year (Adjusted)” column. This is where you will take the automatically generated numbers and adjust them manually if the number seems unreasonable or you know there will be some major upcoming changes to your business goal. You can leave the auto-generated column alone as a reference.

For example, if you know you plan on hiring an assistant next year, you can manually factor that into your costs. Or if you know that your brokerage fees will go down, you can adjust for that as well.

Keep in mind that if you change a number manually, you’ll have to adjust the other numbers as well.

Marketing Plan

Your real estate marketing plan should include your overall marketing strategy, including lead sources, your marketing calendar, and your marketing budget.

Getting clear on what lead sources you’re going to focus on for this year is crucial. As I mentioned earlier, think of lead generation in two ways. You either need to increase your met or haven’t met database or both.

Potential lead sources could include open houses, expired sellers, Google PPC, real estate investors, and so many more. But simplicity is key. Choosing one (or two) lead sources to focus on until you’ve mastered it, will help you get further faster.

Your marketing calendar will help you plan out your marketing events, marketing campaigns, and marketing touchpoints. Usually, I like to set my marketing calendar six months in advance.

My marketing budget forecasts what I expect to spend on my lead generation. This also is where I can track my return on investment over time.

Real Estate Business Plan Monthly

Under the Monthly Tracker tab, we begin to break down your number of transactions, gross commission income, expenses, and profit by month. Ideally, you’ll want to use historical trends you’ve noticed in your business to create a proper forecast.

For example, a real estate agent tends to sell more in the summer months than in the winter. Therefore, your summer months should show more transactions and commission income than the winter months.

This tab, as seen below, will keep track of your progress towards goals as you follow your real estate agent business plan throughout the year.

A spreadsheet to track monthly income and expenses

The goal you want to reach by the end of the year is on the right-hand side under the “Total” column. Take this number and divide it by twelve to come up with an average monthly goal. Then go back and adjust the numbers a bit for seasonality.

At the end of each month, come back to this table and fill out how you did in the rows marked “Actual” so you can compare numbers and see where you are with your goals. The row below each “Actual” input will track how much you exceeded or missed your goal.

Breaking your goals down into smaller monthly or quarterly chunks is easier to manage and will help you stay focused on what’s at hand in your business.

Personal Budget

Often, as agents earn more money they spend more money, causing them to stay on the hamster wheel indefinitely. To prevent this, you need to have a defined income goal.

To create a complete real estate business plan, I’ve found it beneficial to incorporate your personal finances.

Understanding your monthly living expenses and what you need to save or pay in debt will ensure your goals align with your personal goals.

A spreadsheet to track budget in your real estate business plan

When it comes to logging personal expenses, I recommend a tool called You Need A Budget (YNAB).

If you don’t want to sign up for YNAB, I’ve included a tab in my business plan template spreadsheet that will allow you to categorize your expenses and get a better understanding of your personal finances.

Personal Net Worth (Financial Plan)

Tracking your net worth is one of the most important metrics for your overall financial plan. A greater net worth will help you increase your passive income. As your passive income increases, life seems to get easier until the point where you can retire.

Most real estate agents can forego a traditional Balance Sheet since real estate professionals generally don’t have many assets or liabilities within their business. Instead, a Realtor mostly operates on cash flow (income and expenses).

That said, tracking your personal assets and liabilities, including any real estate investment, is vital. Your net worth will give you the ability to slow down and retire one day.

A spreadsheet to track net worth in your real estate business plan.

You can use YNAB to track your net worth or use a financial plan spreadsheet like the one included in my real estate business plan.

The only way to increase your net worth is to either increase your assets or decrease your liabilities.

Knowing what you would like your net worth to be at the end of the year will help guide your real estate business plan.

Final Thoughts on Real Estate Business Plan

Your business plan is a living document that’s continuously updated and improved upon. If you’re like most agents, your real estate business plan has likely gone through several iterations as you’ve learned more about the industry and what works best for your large or small business.

The end result of this process should be a well-rounded professional marketing strategy that includes everything from monthly budgets to annual goals – be sure to grab mine below!

Kyle Handy

Would You Like To Partner With Me?

I’ve helped hundreds of real estate agents, team leaders, & brokers all over the country increase their sales, online presence, and create scalable systems. I would love the opportunity to work with you. Together, we can make this year your best yet!

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