What Is The Best Way To Write A Real Estate Business Plan?

Real estate investment success does not happen immediately, and it certainly does not happen without careful preparation and execution. A real estate development business plan will act as a road map for all of the business operations for entrepreneurs. Simply put, a real estate business plan will play a critical role in the development of your real estate investment career.

To build a viable business plan, investors would need to strategize some main elements. Future aspirations, business principles, funding plans, and other factors are among them. A business plan, once completed, will lay the groundwork for smooth operations and outline a bright future for your investing career. Continue reading to find out how to make a real estate investment business plan right now.

What Is A Business Plan For Real Estate Development? (& Why Do You Need One)

A real estate business plan is a living document that lays out the foundation for the company’s activities and objectives. A strategic plan would outline the company’s long-term objectives as well as the measures necessary to achieve them. Although business plans differ from one investor to the next, they usually cover a period of one to five years.

Without a question, one of the most critical moves a potential investor can take is to draft a business plan for real estate investment. An REI business plan will help you avoid possible stumbling blocks while still positioning you for success. It’s a guide to follow when everything goes as expected, as well as when things go awry. A real estate company’s business plan, if nothing else, would ensure that investors know what steps to take to achieve their objectives. Nothing is more valuable to today’s investors in several respects. After all, it is the strategy to take the shortest route to success.

real estate investing business plan

8 Things to Include In a Real Estate Business Plan

A real estate business strategy as a whole should address the company’s short and long-term objectives. The best strategic strategy would take more detail than a future roadmap to correctly reflect a company’s vision. A good real estate investing business plan will go over every detail in great detail. This can include things like the organization’s structure, financial data, and a marketing plan, among other things. It will serve as a detailed summary for everyone who interacts with your business, whether internally or externally if done correctly.

Creating an REI business plan, however, would necessitate a high level of attention to detail. Drafting a real estate company business plan may seem to be a daunting job for new investors, and it is. Knowing which ingredients must be added is essential (and when). The following are seven essential components of a well-executed business plan:

  • Outline the company’s mission statement and principles.
  • Divide the long-term and short-term objectives.
  • Analyze the company’s strengths and weaknesses.
  • Build the most appropriate investment plan for each property and your particular objectives.
  • Include any marketing and branding strategies that could be made.
  • Indicate how the business will be funded (and by whom).
  • Describe who works for the organization.
  • Backup plans and exit strategies should be used to address any “what ifs.”

These are the most critical elements, and a successful real estate business plan would go into each one in depth to ensure full production.


Your mission statement and principles are literally your company’s vision statement. Although these may not be the first steps in planning your venture, having a vision is critical to its success. Not only can the company ideals drive you through investment decisions, but they will also encourage others to partner with you again and again. They should match the motivations of your organization to potential workers, lenders, and tenants.

Think about examples you want in and out of the real estate industry before writing your company vision. Is there a business whose ideals you align with? Or are there any mission statements that irritate you? When designing your own set of principles, look at other businesses for inspiration. As you prepare, feel free to solicit input from your mentor or other network connections. Above all, consider the values you admire and how they can be incorporated into your business strategy.


One of the most critical components of a good business plan is objectives. This is because targets not only define the company’s end goal but also detail the steps necessary to get there. It’s useful to divide priorities into two categories: short-term and long-term. Long-term strategies would normally detail the company’s plans. Ideal investment forms, benefit figures, and business size are just a few examples. Short-term objectives are the smaller, more manageable moves that will get you there.

One long-term business target, for example, may be to secure four wholesale deals by the end of the year. By breaking it down into smaller measures, short-term targets will make it more realistic. Build a direct mail campaign for your target area, create a buyers list of 50 contacts, and secure your first property under contract as a few short-term goals that could help you land those four wholesale deals. Breaking down long-term goals into smaller chunks is a perfect way to keep yourself accountable, set deadlines, and reach your objectives.

SWOT (Strengths, Weaknesses)

Strengths, Weaknesses, Opportunities, and Threats (SWOT) are acronyms for strengths, weaknesses, opportunities, and threats. When evaluating the business and future rivals, a SWOT analysis entails going about each of these fields. This system enables business owners to gain a deeper understanding of what is working for them and where they can improve. SWOT tests are used in a variety of industries to develop more actionable solutions to potential problems.

To do a SWOT review for your real estate business plan, first find out what your company’s future strengths and weaknesses are. Do you have any decent tenants? Are you having trouble raising funds? When you list each group, be frank with yourself. Take a step back and assess your business sector, as well as any rivals, for risks and opportunities. If your rental rates are out of line with comparable properties, this may be a problem. A possible opportunity, on the other hand, might be to improve your property’s facilities to make it more competitive in the area.

Investment Approach

Any successful real estate investment business plan must be able to execute a sound investment strategy. If nothing else, a company will benefit from a variety of exit strategies, including rehabbing, wholesaling, and renting, to name a few. This is where investors can evaluate their competition and decide which strategy is better suited to their objectives. Those looking for a long-term retirement should consider investing heavily in rental assets.

Those without the financial resources to construct a rental portfolio will want to consider beginning with wholesaling. In any case, now is the time to determine what you want to do with each property you come across. It’s worth noting, however, that this technique can differ from one property to the next. As a result, investors must settle on an exit strategy based on the asset and their current objectives. This portion of a real estate investment business plan should be included because it would be useful until a potential offer is identified.

Marketing Strategy

Although marketing can appear to be the icing on the cake of a solid business plan, it will actually play a crucial role in the long-term success of your company. Your company’s logo, website, social media sites, and any promotional campaigns should all be included in your marketing campaign. These elements, when combined, will help you create a strong identity for your company, which will help you develop a strong business reputation and, eventually, confidence with customers, clients, and others.

To begin planning your campaign, consider how your brand should reflect your company’s principles and mission statement. Consider how your idea can be incorporated into your logo or website. Note that, in addition to recruiting new customers, marketing campaigns will also assist in the maintenance of established partnerships. This guide will walk you through the process of creating a real estate marketing plan step by step.

Plan for Funding

It can be difficult to write the financial section of a business plan, particularly if you are just starting out. In general, a financial plan may contain a business’s income statement, cash flow, and balance sheet. A financial plan should also provide short and long-term profit and loss targets for a company. This data, when combined, will assist in the making of business decisions, raising capital, and reporting on business success.

Accuracy is often the most important thing to consider when making a financial plan. While many investors want to report on high income or low losses, data manipulation will not increase the company’s results. Create an organizational structure that works for you, and make sure the financial statements are accurate at all times. A financial plan, as a whole, should assist you in deciding what is and is not working for your business.

Small Business Systems & Teams

Without an overview of operations and management, no effective business plan is complete. Consider how and by whom the organization is managed. The organizational structure, office management (if any), and an overview of any current projects or assets will be included in this detail. When preparing this information, investors should provide potential targets for team development and organizational changes.

Even if you are just getting started or have yet to launch your company, you must plan your business structure. Begin by deciding which activities you will be responsible for and identifying places where you will need assistance. If you have a business partner, consider your respective strengths and weaknesses and how you can better complement one another. Make an appointment with your real estate coach for additional advice. They will give you useful insights into their own market process, which you can use as a springboard for your own planning.

Exit Strategies and Contingency Measures

Whether you believe it or not, every successful business has a backup plan. Businesses collapse every day, but investors can position themselves to survive even the worst-case scenario by developing a contingency plan. As a result, it’s important to plan alternate exit strategies and contingency plans for your investment company. These will assist you in developing a course of action in the event that anything goes wrong, as well as addressing any future issues before they arise.

This portion of a business plan should address all future lender, employee, or client “what if” scenarios. What happens if a home sits on the market for longer than anticipated? Or if a seller backs out before the sale is completed? What if a property’s vacancy rate is higher than average? These (and many others) are important to consider when you write your business plan.

Template For Writing A Real Estate Investment Business Plan

A genuinely excellent real estate investment business strategy will have a long-term effect, while a mediocre plan will get in the way of your long-term objectives. The reality is that a real estate business strategy is crucial, and as a new investor, you should give it your full attention. Writing a business plan for real estate investment isn’t simple, but it can be done properly. To ensure you get it right the first time, use our real estate investment business plan template:

  • Prepare an executive summary that gives a bird’ eye view of the company.
  • Have a list of the company’s objectives and how you plan to meet them.
  • Through a comprehensive business study, you will show your knowledge.
  • Indicate who works for your business and what their credentials are.
  • Summarize the goods and services that your company provides.
  • Outline your marketing plan for each facet of your business.

Summary of the Report

Defining your mission and vision is the first step. In a nutshell, an executive summary is a snapshot of the entire business, and it will usually include a mission statement, company overview, growth data, products and services, financial plan, and future goals. This is your business plan’s “why,” and it should be stated explicitly.

Description of the Company

The next move is to look over the company and provide a high-level overview of the different elements, including priorities and how you intend to achieve them. Investors should identify their company’s existence as well as their target market. Explain how the company’s services or products will satisfy those needs, as well as the particular clients, organizations, or companies it will represent, and the competitive advantage it will provide.

Market Research

This segment will recognize and demonstrate your industry expertise. It will usually include specifics about your target market, such as distinguishing features, scale, market share, and pricing and gross margin targets. Your SWOT review will be included in a detailed industry overview.

Management & Organization

This is where you clarify who is responsible for what in your business. This section should provide information about your company’s organizational structure, ownership data, management team profiles, and qualifications. While as a real estate investor, this may seem unnecessary, the people reading your business plan may want to know who is in charge. Make certain that no stone is left unturned.

Items Or Services

What exactly are you trying to sell? What is the value to your customers? This portion of your real estate business plan is where you identify your product or service, as well as its advantages over competitors. It will, in effect, include an overview of the product/service, information on its life cycle, intellectual property, and research and development activities, which could include potential R&D activities and efforts. Beginner investors must decide why their service is better than those in the industry because real estate investment is more of a service. It can involve prior experience.

Marketing Strategies

A marketing strategy describes how a company owner plans to advertise or sell his or her product or service. A market penetration strategy, a future growth plan, distribution networks, and a detailed communication strategy are all included. Investors should evaluate how they expect to find and contact potential leads while designing a marketing strategy for a real estate business plan. Then they can consider different contact options, such as social media, direct mail, a company website, and so on. The marketing section of your business plan should basically cover the operational and growth steps of your company.

real estate investor business plan

Tips for Writing a Real Estate Business Plan

It is not difficult to write a good business plan; however, it will take time to get it correct. Here are a few more pointers to consider as you create a strategy for your real estate investment business:

Customize Your Executive Summary For Various Audiences

An executive summary will present your company and open your business plan. While the majority of your business plan will stay the same, the executive summary should be customized to the audience in question. A business plan is essential not only for you, but also for potential investors, lenders, and customers. When writing the executive summary, keep your target audience in mind and answer any questions they may have.

Clearly State The Objectives

Too often, investors working on a business plan will keep their objectives hidden, whether it’s financing or a joint venture. When trying to make a case, do not bury the lede. In a business plan, be transparent about your priorities from the start and get your point across quickly.

Demonstrate Your Business Knowledge

It is important to provide information about your market area in your company description. Average sale prices, median income, vacancy rates, and other factors may be considered. If you want to buy rental homes, you may also want to answer questions about new projects and housing patterns. Showing that you have your finger on the pulse of the market would make your business strategy even more appealing to those who read it.

Do Your Homework On The Market

Several real estate business plans neglect the value of carefully evaluating the competition. This may be due to the fact that, unlike a physical product-based company, it can be difficult to see what your rivals are up to. Although you won’t be given a tour of a competitor’s company, you can pretend to be a prospect and see what they have to offer. Visit their open house, sign up for their email, or check out their website. Getting a firsthand look at what others are doing in your industry will greatly assist in the development of a business plan.

Be Realistic With Your Operations & Management

When writing a business plan, it’s easy to overestimate your estimates, particularly in the section on organization and management. Some investors will say they do it themselves, and others will say they will hire a much larger team. It’s important to consider how the company will run on a daily basis. Be realistic about what needs to be done and who will be doing it while drafting your business plan.

Create Example Deals

At this stage, investors may want to figure out a way to show their future plans. Display the steps involved in future transactions, either literally or figuratively: acquisitions, cash flow, appreciation, sales, trades, 1031 swaps, cash-on-cash returns, and more. As a result, investors should have a clear idea of how their transactions will turn out in the future. Although it isn’t expected to happen, visualizing things makes them simpler in the future.

Schedule Company Update Sessions

The real estate business plan isn’t a set-it-and-forget-it document that you fill out once and then forget about. It’s a living document that should be read and changed on a regular basis. Daily analysis sessions to go over your business plan are a successful technique. Look for ways to streamline and develop your business strategy so that it is as transparent and convincing as possible.

In Conclusion

A real estate development business plan would be motivational and insightful above all else. It should explain why your company is more than a pipe dream and include actionable steps for turning your vision into a reality. A comprehensive business plan will drive your future in more ways than one, no matter where you are in your investing career. After all, a well-thought-out approach will predict the most successful path to success. As you prepare your real estate venture, use the example above to make sure it’s a good one.