How To Profit In Real Estate Business Ownership Revised Edition: Essential reading for any existing or aspiring real estate business owner

By Paul Davies and Tom Panos

Are you a real estate agent who wants to retain 100% commission and set up your own business? Or are you a real estate business owner looking to increase your profit margin? Whatever your situation, this book will help you build a secure and sustainable financial future for yourself and your family.

In the real estate industry it

• Language: English
• Publisher: One Agency Pty Ltd
• Release date: Sep 26, 2019
• ISBN: 9780648680208

Book preview

Foreword: Tom Panos

I first met Paul around 2012, when he came to my office at News Corp to introduce me to One Agency. He struck me as someone who was extremely passionate about real estate, what he was building, and his unique offering in the marketplace. Since then I’ve come to admire his ethos, drive and vision.

I’ve worked in the real estate media industry for many years. I’m a commentator on Sky Business News, and my video blogs are received by 17,000 agents every week. I also run a real estate training business. So when Paul talked with me about the importance of brand, positioning and marketing, I got involved by providing training and coaching for One Agency members.

A successful agent is many things: hardworking, caring, disciplined and authentic, but also knowledgeable, passionate, motivated and process-driven. High levels of energy and a solid marketing base are also essential. To succeed in any area of life I believe we must remain motivated and be able to sustain, and then to maintain, in order to reach our goals.

As individuals we should never stop learning or growing and I’d encourage you to read this book with an open mind. You never know how a book or even one of its chapters might change the direction of your life. Paul has shown great leadership in helping agents to build profitable real estate businesses. He’s a man who has walked the walk and brings his experience direct from the coalface. In the following pages he reveals why he started One Agency and how he became such a passionate, driven and caring real estate group CEO.

Paul’s business model is also quite unusual. It allows people who want to have control over their destiny to work independently and yet also receive the many benefits of being part of a group, with the backing of a national brand. It also harnesses the buying power of a large entity and has a close community of like-minded people. It differs from other models by allowing the flexibility of being either a smaller one-person boutique agency or a larger operation, whatever your desire. It is certainly suited to those who want to take control and run their own business in their own way.

Of course different models suit different people and I’m not saying one is better than another. I’d encourage you to do your research and find out what direction is going to best suit your career and your life.

This book isn’t a pitch for the One Agency model and, regardless of which path you choose to walk, Paul offers a solid understanding of the real estate business and how to make it work for you.

Tom Panos

Tom Panos is regarded as one of Australia’s leading real estate coaches. He offers free real estate training, coaching and success tools on how to become a 7-figure Attraction Agent. tompanos.com.au

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Introduction: Paul Davies

It’s 1985 and I’m sitting at my desk at Lidan Realty in Neutral Bay, Sydney. I’ve worked there for 13 years and, looking through the window onto Military Road, I see a familiar figure walk towards an unfamiliar car, open its driver’s door, get in and drive off. The picture just doesn’t compute.

Then it dawns on me… It's my boss, and he’s getting into a Rolls Royce. Last week he was driving a Commodore!

He drives away, completely unaware that he's set off a response in me so profound that it literally pushes me back in my chair and I hear a loud, clear voice in my head:

Paul, you just can’t do this anymore.

My relationship with my boss was completely inequitable. I liked him, he was a good person and a friend, but he didn’t do a whole lot of work. I was putting blood, sweat and tears into the business, hours upon hours of work to create as much income as possible, and he’d just bought himself a Rolls Royce!

When you work for someone else, you’re part of their wealth creation process and for me, for a while, that was absolutely fine. When you’re just starting off and you don’t know the difference between a listing presentation and property inspection, you need someone to show you the ropes. I call it ‘the cost of a real estate education’. Until that moment, I had been perfectly happy where I was.

But the Rolls Royce moment changed everything. It defined the direction I was to then take in my life and, since that point, I have owned five separate businesses. I have set up hundreds of agents in their own enterprises and am now the Founder and CEO of Australia’s fastest-growing International real estate network.

It hasn’t been easy. Over my 40 years of real estate experience, I made many, many mistakes. In fact, to be honest, I’m probably one of the slowest learners I know. I wouldn’t say I’m that much smarter than the average Joe either. Really, my greatest redeeming feature has probably been that I’m willing to stick with things and have a go.

Nobel Prize winning physicist Niels Bohr once said:

An expert is a man who has made all the mistakes which can be made, in a narrow field.

Running your own business is one of the most rewarding things you will ever do, but it’s also one of the hardest, especially if you’re not experienced. That’s why this book can be useful to you; because I’ve made those mistakes and now know what works.

Each chapter covers a different aspect of business ownership. Chapter One provides a rundown of the mental requirements to run a business, while Chapter Two explores some of the reasons you might decide to start an enterprise, and the potential consequences of that. Chapter Three is a quick run through of my own experiences and the various businesses I’ve owned. Chapter Four offers up the various business ownership options, and Chapter Five questions what performance level you need before embarking on business ownership. Chapter Six discusses some of the more complex decisions that you’ll need to make: shop-fronts and staffing. Chapter Seven lists the basic elements needed to start any business. Chapters Eight and Nine, cover ideas touched upon in Chapter Two in greater detail, providing an in-depth critique of the risks and rewards of becoming a business owner. Chapters Four, Five and Ten are newly added content.

In the real estate industry, there’s an ingrained belief that agents and business owners have to spend vast amounts of money acquiring the basic tools to do their job. This includes building expensive shelves (aka offices) to display real estate to buyers. I don’t agree with this, but the potential financial consequences of this belief mean it deserves special note. HOWEVER, if you are an existing business owner with an existing shop-front, then there are most certainly ways to reduce your current outgoings, so you can retain more of your income. The subject is addressed in full in Chapter Six.

In the end, the only true measure of success is your actual net profit before tax – how much of your hard-earned money remains after operating costs. That’s why I’ve written this book.

This book is NOT intended as a sales pitch for One Agency. That said, if you are curious about how One Agency could work for you, or you’re simply interested in the business model, the topic is addressed in the final chapter, Chapter Eleven.

Many people don’t realise that running a business is actually within their ability, dismissing the idea without properly exploring and understanding what it’s really about, before making an informed decision whether or not it may suit them. But the fear of doing something is always greater than actually doing it.

You don’t know that you can’t do something until you’ve tried. Running a business is now easier and more affordable than ever before. It may not be for everyone, but hopefully, these next eleven chapters will help you to work out if it’s right for you.

I hope you enjoy the read.

Paul Davies

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Chapter One: Do You Have What it Takes?

Your belief in yourself is the single biggest factor in determining your business ownership future.

Business ownership is not for everyone and that’s a fact – it can’t be. In my own experience I never really dreamed I would own a business, and when the thoughts started, I certainly had a lot of serious doubts as to whether I could operate my own enterprise. Of course it’s much easier not to do something, avoid the torment in your mind and the real possibility of failure!

However, the thoughts for me persisted and it’s my experience so far in life that most things are not as hard as you imagine. You may well delightfully surprise yourself as to what you can do and achieve. And yes, you will make mistakes, it’s only human, especially when you attempt to do something new or something you’ve not done before. But you will learn. Nobody was born knowing how to walk, but somehow we learned and nobody fails at learning to walk, as hard as it is.

But it’s also worth saying that, as a small child, nobody would have said that you couldn’t do it. You wouldn’t have said to yourself that you couldn’t do it. You’d just have seen everyone around you walking, and you’d have kept trying and trying until you succeeded. There’s a huge lesson in this, one that you already discovered, that as we grow we somehow learn to doubt ourselves. Doubt creeps in. However, learning to doubt ourselves is a lesson best forgotten.

Whilst it’s advantageous to know your industry and your market inside out, as a real estate agent and for anyone embarking on setting up a business, it’s not an absolute requirement. Interestingly, at One Agency, we have numerous members who have come to us as business owners from