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HomeVestors Franchise ProfileReal Estate Franchises > Residential Brokerage |
Overview of HomeVestors Franchise Costs
The HomeVestors franchise requires an initial investment ranging from $109,000 to $461,250, including a franchise fee of $85,000. Franchisees should be prepared for ongoing costs, including a 2% royalty fee and a 6% marketing fee. To qualify, you need a net worth between $150,000 and $400,000, along with sufficient cash reserves to cover startup expenses.
Potential Revenue and Profitability
HomeVestors franchisees can anticipate average annual revenue of approximately $1,276,046 per unit, with the potential for earnings ranging from $123,000 to $4,500,000. The average EBITDA stands at about 33.6% of revenue, indicating a healthy profit margin. With a breakeven time of around 12 months and an investment payback period of 24 months, this franchise offers a promising return on investment for dedicated operators.
Franchise Growth and Stability
HomeVestors has shown a stable presence in the franchise market, with 1,148 franchised units in 2021, slightly decreasing to 1,082 in 2023. The company has also started to expand its corporate units, increasing from 0 in 2021 to 10 in 2023. This growth trajectory suggests a commitment to strengthening the brand while providing franchisees with additional support and resources.
Support and Training for Franchisees
Franchisees benefit from comprehensive training and ongoing support from HomeVestors. The training program equips new owners with the skills needed to navigate the real estate investment landscape successfully. Franchisees receive guidance on marketing strategies, operational efficiencies, and leveraging the HomeVestors brand to maximize their business potential. This support helps franchisees build confidence and competence in managing their operations effectively.
HomeVestors Franchise Financial Requirements
Below, you’ll find an overview of the initial investment needed to launch the business, along with the ongoing fees required by the franchisor to maintain operations over time.
The minimum total assets (minus liabilities) you must possess.
Net Worth Required:
The estimated period to recoup your total investment.
Investment Payback:
The initial fee paid to join the franchise system.
Franchise Fee:
Ongoing percentage of revenue paid to the franchisor.
Royalty Fee:
Regular contribution toward the franchise’s advertising fund.
Marketing Fee:
The estimated timeframe to recover your initial costs.
Breakeven Time:
The total amount required to launch the franchise.
Initial Investment:
The minimum liquid capital you must have on hand.
Cash Required:
The typical yearly revenue generated per franchise location.
Average Revenue:
The middle value of yearly revenue among franchise locations.
Median Revenue:
The largest reported annual revenue among franchisees.
Highest Revenue:
The smallest reported annual revenue among franchisees.
Lowest Revenue:
A broad sector defining similar types of franchise businesses.
Industry:
A more specific division within the broader industry.
Category:
The key individuals guiding the franchise’s strategy and growth.
Leadership:
The official business address of the franchisor’s headquarters.
Corporate Address:
Available financing options to help start the franchise.
Funding Year:
The main organization that owns the franchise brand.
Parent Company:
HomeVestors Franchise Unit Growth Summary
A breakdown of corporate, franchised, and total units, with yearly net changes.
Total Units
Franchised Units
Corporate Units
| Units | 2021 | 2022 | 2023 |
|---|---|---|---|
| Total Units | 1148 | 1144 | 1092 |
| Net Change YoY | -4 | -52 | |
| Franchised Units | 1148 | 1144 | 1082 |
| Net Change YoY | -4 | -62 | |
| Corporate Units | 0 | 3 | 10 |
| Net Change YoY | 3 | 7 |
Investment Overview
HomeVestors offers a range of investment options for aspiring franchisees, with an initial investment between $109,000 and $461,250. The franchise fee is set at $85,000, with ongoing royalty fees of 2% and a marketing fee of 6%. This structure allows franchisees to leverage a well-established brand while managing their financial commitments effectively.
Revenue Potential
Franchisees can expect an average annual revenue of approximately $1,276,046 per unit, with some units generating as much as $4,500,000. The financial performance of HomeVestors franchises indicates a strong potential for profitability, making it an attractive opportunity for entrepreneurs looking to enter the real estate investment market.
Financial Requirements
To become a HomeVestors franchisee, candidates must demonstrate a net worth between $150,000 and $400,000. Additionally, a cash requirement of at least $109,000 is necessary to ensure that franchisees have the financial resources to support their operations and marketing efforts from the outset.
Breakeven and Payback
Franchisees can anticipate a breakeven period of approximately 12 months, with an investment payback time of around 24 months. This relatively quick return on investment is appealing for those seeking a viable business model with a clear path to profitability.
Franchise Growth
HomeVestors has shown consistent growth in franchised units, with 1,148 units in 2021, slightly declining to 1,082 in 2023. Despite the decrease in total units, the addition of corporate-owned units suggests a strategic focus on enhancing brand presence and operational support for franchisees.
Operational Insights
The average operating expenses for HomeVestors franchises total approximately $16,209,409, which includes salaries, depreciation, and other related costs. With a gross profit margin of 66.8%, franchisees can effectively manage their expenses while maximizing profitability, making informed financial decisions crucial for long-term success.
Frequently Asked Questions
The initial investment for a HomeVestors franchise ranges from $109,000 to $461,250. This includes the franchise fee of $85,000, along with other startup costs.