- Most big-name real estate agencies in South Africa sell some of their stores as franchises.
- They will sell you a franchise, train you and possibly your staff, and offer ongoing support - for upfront and ongoing fees.
- Competition between franchises and real estate brands is tight, and many don't publicly disclose their franchise fees.
- Some real estate franchises don't involve selling houses as such, but instead focus on peripheral activities.
- Some real estate agencies and property businesses cost as little as R50,000 in upfront fees, but more established brands with physical stores cost significantly more.
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* This article has been updated below.
South Africa's real estate agency market is highly competitive, with a handful of established brands dominating much of it.
Buying a franchise from an established brand can help you avoid many difficulties and pitfalls of launching a private agency. The franchisor will provide you with the tools needed to start your own property sales business within a specific region. Some offer ongoing support and training to improve your chances of success - and their chances of earning more significant monthly revenue via franchise fees.
Picking a real estate franchise isn't exactly straightforward, though. Many agencies target specific market sectors. Although those focused on the high end of the market might earn you a greater commission, their turnover may be less than those who sell cheaper properties.
Not all real estate franchises are equal, either. Some offer a complete brick and mortar experience and will help generate leads for franchisees. Others provide a simple online presence and may expect you to do the bulk of the lead generation and marketing.
The region a franchise allows you to operate in is also critical to your business' success. In many cases, a franchisee will only have the right to sell within certain suburbs.
If you want to start a real estate or property business, and would prefer to buy into an established system, then this is what you can expect to pay.
Just Property has 122 franchises located throughout South Africa. They offer both sales and rentals, including a selection of holiday rentals. They are currently selling franchises throughout South Africa and are looking for franchisees who are financially astute, ethical, and have business experience, among other skills. They offer a mentorship programme via their head office to teach new franchisees about running a property business.
The average cost of a new Just Property franchise is R60,000 to R200 000, depending on the size and location of the store. Franchisees must also pay a monthly marketing and advertising fee of 2% and a royalty fee of 6%.
Jawitz Properties is an established real estate brand in South Africa - the business has 51 years of experience in the industry and claims to take a hands-on approach with franchisees. They're looking to take on new franchisees, and offer a range of add-ons like training, social media, business development support, and an online referral system.
Although having some passion for or experience in the property market is advantageous, it's not a prerequisite to becoming a franchisee. They currently have franchise opportunities available in cities throughout South Africa and in Mozambique, Mauritius, Namibia, and Botswana.
Jawitz Properties charges new franchisees an upfront fee of between R30,000 and R200,000, depending on the size of the area. They recommend a working capital of R600,000 to R1 million, and they estimate the total investment to be roughly R1.2 million. Once established, they charge monthly fees of 8%, which go towards advertising, marketing, and management.
Property Guys is a private seller real estate business that's not a typical real estate franchise. Although they don't sell houses, they offer flat-fee marketing and advertising services to homeowners who wish to sell privately. They do, however, claim to connect buyers and sellers directly.
The business is just two years old, but they're looking to grow their network by taking on new franchisees who are "strong hard working lead generators".
A new Property Guys franchise costs up to R500,000 - split between establishment and upfront fees, and recommended working capital. They estimate annual fees to be R206,400 per year and charge 7% in gross revenue royalties.
UNIQUECO Property Valuers
UNIQUECO Property Valuers started in 2008 and provides professional valuation services of properties in the private, corporate, and government sectors. They're looking for suitable partners to take up a franchise share in the business. They offer new franchisees basic training, business advice, and marketing support, among other services.
The cost of the franchise is between R100,000 and R500,000. The establishment cost is R50,000, and they recommend a working capital of R300,000. They also charge a monthly fee of 17%, split between advertising, marketing, and management.
* This article was updated after publication to include the correct figures for Just Property.