And determine which specialty is best for you to turn a real estate hustle into your primary income.
Are you a real estate professional competing with the other 1.4 million in real estate?
Do you have potential to be successful in real estate but feel buried in the mass of average real estate professionals?
Have you considered adding a specialty to your profession to stand out amongst the crowd?
If you answered yes to any of these questions, continue reading to learn what the top 5 real estate specialties are, along with their pro’s and con’s so you can determine which real estate side hustle or primary career is best for you to specialize in.
Short-Term Vacation Rentals
Short-term vacation rentals are furnished properties rented to guests on a short-term basis. These rentals are usually marketed and booked through online platforms such as Airbnb, VRBO, or Booking.com. Vacation rentals offer an alternative accommodation option for travelers seeking more of a homelike experience compared to traditional hotels.
Consider the following expectations to start a short-term vacation rental business:
- You must own the property and have legal authority to rent it out. Be sure to check local regulations and homeowner association rules to ensure short-term rentals are permitted.
- You must keep the property clean, well-maintained, and adequately furnished – including Wi-Fi, kitchenware, bedding, bathroom supplies, and toiletries.
- You must obtain proper insurance coverage for your vacation rental property. Standard homeowner’s insurance may not cover short-term rentals, so be sure to consider specialized vacation rental insurance that provides coverage for liability, property damage, and theft.
- You must manage the property or hire a property management company to handle bookings, guest communication, check-ins, cleaning, and maintenance.
Advantages of Having a Short-Term Vacation Rental Business:
- High rental income potential, especially in popular tourist destinations.
- Flexibility in the terms of property usage – can be used personally in between rental usage.
- Marketing made easy to reach a wide audience by using platforms such as Airbnb, VRBO, and Booking.com.
Disadvantages of Having a Short-Term Vacation Rental Business:
- Seasonal fluctuations may cause inconsistent rental income.
- High level of management responsibilities in comparison to the other specialties
- Potential legal and regulatory challenges, such as zoning restrictions.
Luxury Properties
Luxury properties are high-end, premium properties that offer exceptional quality, unique features, and lavish amenities. These properties often cater to affluent individuals or families who seek exclusivity, luxury, and prestige in their homes. Luxury real estate can include expansive mansions, penthouses, waterfront estates, luxury condominiums, and gated communities.
To begin selling luxury real estate, consider the following expectations:
- Demonstrate strong negotiation skills and expert advice, which requires deep understanding of the local luxury real estate market. This includes market trends, property values, and the preferences of high-net-worth individuals. Consider taking specialized training and education in luxury real estate.
- Create a strong personal brand that reflects your expertise and targets the luxury market. It’s important to establish connections and build credible relationships with high-net-worth individuals. This may require you to join exclusive clubs to expand your professional network, which can become expensive.
- Curate a portfolio of luxury properties that align with the preferences and demands of high-end clients. Use high-quality photographers and videographers to ensure your listings are comprehensive, highlighting the property’s distinct features, amenities, and lifestyle benefits.
- Provide personalized, white-glove service to luxury clients. Handle their transactions discretely with confidentiality to respect their privacy and security concerns.
Advantages of Having a Luxury Property Business:
- Higher commission rates and larger profit margins.
- Prestige and exclusivity in high-net-worth social circles.
Disadvantages of Having a Luxury Property Business:
- Longer selling cycles and a limited pool of potential buyers.
- Stronger volatility based on market downturns affecting property values.
- Increased competition from other luxury real estate specialists.
Divorce Real Estate
Real estate professionals who specialize in providing real estate services to couples going through a divorce understand the unique challenges and complexities that arise when dealing with divorce proceedings. They help clients navigate property division, evaluate the financial implications, and provide support throughout the process.
To begin working in the divorce real estate niche, consider the following expectations:
- Have a comprehensive understanding of divorce laws and regulations in your jurisdiction. It’s helpful to express your expertise by using common legal terms and referring to the divorce procedures as needed.
- Build relationships with divorce attorneys, mediators, financial advisors, and other divorce professionals. Networking with these individuals can lead to referrals.
- Realize the emotional nature of divorce and approach your clients appropriately. It’s important to stay neutral and not get involved in a messy divorce. Practice sensitivity and discretion, especially while handling delicate situations.
- Target your marketing to highlight your expertise in divorce real estate. It’s recommended to establish an online presence with a professional website, informative content about divorce real estate, and leverage social media platforms.
Advantages of Specializing in Divorce Real Estate:
- Opportunity to guide and support clients during a challenging time in their lives.
- Potential to build a vendor network to curate an inbound marketing business based on B2B referrals.
Disadvantages of Specializing in Divorce Real Estate:
- Emotional complexity and potential to get involved in marital conflicts.
- Delicate negotiations and managing multiple stakeholders.
- Extensive knowledge of divorce laws and regulations.
- Significant decline in divorces in the United States over the past 20 years, which means it’s a smaller and more competitive niche. In 2000, 4 of every 1,000 couples divorced. In 2020, 2.7 of every 1,000 couples divorced.
Pre-Foreclosure & Foreclosure Properties
Pre-foreclosure real estate refers to properties being sold by financially distressed homeowners. Foreclosure real estate refers to properties being sold by lenders or financial institutions due to the owners’ inability to meet mortgage payment obligations. When a homeowner defaults on their mortgage, the lender may initiate foreclosure proceedings to recover the outstanding debt by selling the property.
Consider the following expectations to begin working in foreclosure real estate:
- Understand the foreclosure process, including specific laws and regulations governing foreclosures in your jurisdiction.
- Build relationships with lenders and financial institutions. By networking with asset managers, loan officers, and other professionals in the foreclosure niche, you can build an inbound referral network.
- Develop expertise in distressed property sales and the unique considerations involved, such as title issues, property conditions, liens, encumbrances, and other challenges involved with foreclosures.
Advantages of Specializing in Foreclosure Properties:
- Potential for discounted prices and investment opportunities.
- Ability to help buyers find affordable housing options.
- Opportunity to expand your negotiation skills by communicating with banks and lenders on behalf of your clients.
Disadvantages of Specializing in Foreclosure Properties:
- Extensive research and due diligence required to identify viable foreclosure properties.
- Sensitivity required while working with distressed homeowners going through pre-foreclosure.
- Inventory significantly fluctuates based on the economy so this is not a consistent market to get business in.
Probate Properties
Probate real estate refers to properties that are part of the probate process, which occurs when someone passes away and their estate goes through legal proceedings to distribute assets to heirs or beneficiaries. Probate properties usually need to be sold to settle debts and distribute assets.
To begin working in probate real estate, consider the following expectations:
- Understand the probate process and associated terminology, including laws and regulations governing probate in your jurisdiction. Also, familiarize yourself with the stages of probate.
- Build relationships with estate-related attorneys, estate planners, and other professionals involved with the probate process. Networking with these professionals can lead to a referrals and collaborations.
- Guide and support executors and heirs by educating them about the process, legal obligations, and potential challenges while maintaining sensitivity and discretion.
Advantages of Specializing in Probate Properties:
- This is considered a hidden niche and therefore has the least competition compared to the other specialties.
- Potential for motivated sellers and below-market prices.
- Opportunity to help families through some of the most emotionally challenging times of their lives and see real impact in the value you provide.
- Most reliable niche for consistent business in the next 20 years as baby boomers pass and the United States gets an overwhelm of probate properties.
Disadvantages of Specializing in Probate Properties:
- Complex legal procedures requires extensive knowledge in probate real estate.
- Emotional sensitivity required to deal with grieving families.
- Potential delays in property transfer.
Conclusion
Although each of these top 5 real estate specialties can be incredibly lucrative, it’s important to consider which is best for you based on your personal strengths, market conditions, and risk tolerance. To determine what specialty is best for you, take this FREE 3 hour Lifestyle and Career Design course curated specifically for estate professionals to lay out their ideal lifestyle and determine a career that makes it possible. In this free course, you can expect to:
- Take a unique approach to goal setting
- Get honest about where you are and what you want
- Solidify your core desired wants and needs
- Activate your time chart to live deliberately
- Expand the vision of what you can create
- Choose what type of Estate Professional you want to be
- Initiate an Action Plan and make a “Momentum Move”
Not interested in committing to an online course? Check it out on YouTube here.
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