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Why Buy a Property Franchise?

By 6 January 2022No Comments

You don’t have to be an experienced property investor, landlord or even own your own home to make a success of a property franchise.

That’s because, when you buy a property franchise, you are buying the knowledge of seasoned investors, access to a network of invaluable contacts and, often, a means to financing property deals. By teaming up with a seasoned investor you can easily learn about sourcing and closing a deal.

Signing up to a real estate franchise opportunity allows you to watch investors make money through a variety of different strategies, such as straightforward Buy to Let, to HMO management, Rent to Rent, Joint Ventures and even Property Developments.

How much capital you will need to get started

To buy a franchise you will need to pay a minimum investment fee upfront. The amount you’ll pay depends on how popular and successful the franchise is and also whether you need to buy equipment etc. to start off.

As a result, franchise opportunities can range from £10,000 for home storage company AccessForLofts and £18,000 for Bark Busters Dog Training to £250,000 for a franchise with the Co-op and £800,000 for Burger King. At Sourced, our joining fee is only £12,500 with franchise fees of £245 per month to pay for Marketing and Admin costs.

In property, you need very little capital to start having a cash flow income and to reinvest that profit in other properties so that you can begin building up your property portfolio. That’s because there are many property strategies investors can embark on, without having to pay much cash upfront. Rent to Rent and Lease Option are two of the most popular ‘no money down’ strategies:

Rent to Rent

This strategy involves renting a property (usually a HMO) at a reduced rent because you agree to ‘manage’ it for the owner, who may be tired of it or just doesn’t have the time. You then rent out the rooms yourself, at a profit. An example would be leasing a four-bedroom house for £800 then renting out the rooms for £400 each. You would then be pocketing £800 yourself every month. This would only work if the landlord agreed you could do this. But with a guaranteed rent every month from yourself – and you doing all the wok – why wouldn’t they?

Lease option

This is where you manage a house or apartment with tenants, i.e. pay off the mortgage, for a set number of years until you agree to buy it. For instance, you could draw up a legal contract to buy it five years down the line at the purchase price from when you take charge of the property. This could have been £150,000 and five years later it’s worth £180,000. Sell it and you’ve made a profit of £30,000. The reason the original owner would agree to this is if the property was in negative equity at the time and they wanted it off their hands.

What to look for in the best property franchise

When you join a property franchise you should be able to rely on support from experienced mentors, who have been around in the business for more years than they care to mention and other franchisees. You should also expect to receive training and access to resources such as CRM support, marketing help, regular webinars and courses on different property investment strategies.

To help you source properties there should also be a catalogue of real estate leads you can shift through to find properties that suit your specific strategy, eg refurbs or serviced apartments etc. And, of course, investor leads are crucial too. That way, you don’t have to spend months trying to find the right buyer. Instead, you can find what buyers are interested in, then go and find a property and set up a deal to suit their needs directly.

Best property franchise in the UK

At Sourced we offer training in all aspects of property investment. We’re also here to provide support from our mentors for as long as you need it; you will never be left to flounder around on your own, especially in your first couple of years, while still finding your feet.

The training at Sourced provides franchisees with the skills to be able to source and identify profitable investment opportunities. Our franchisees also know how to package and structure property deals and market them to investors.

They’ll learn what to look for in a refurb property and how to turn it into a money-making conversion for their own buy to let property portfolio or to sell on for a profit.

A further benefit of being a Sourced franchisee is the access to property funding, via an exclusive peer to peer lending platform. This means, members can go ahead and secure a profitable investment opportunity, without having to wait to build up their own funds. It also means they are able to build up their property portfolio far quicker and make larger sums of money in a far shorter period of time, as a result.

To find out more about to become a Sourced franchisee and how to benefit from our team’s expertise, then download our Sourced franchise prospectus today.

Sam Clayton

Franchise Manager