In this section of the business plan we discuss the sales projections for the third year that we have included in this business plan. In order to truly be realistic about the future, we believe that we need to factor in different market conditions into our sales forecasting. As when looking forward at Home At Last Realty, we have projected our sales based on either a slow market condition characterized by a sluggish economy, a good market condtion which we understand to be a economy operating under normal economic conditions of demand and supply and finally a great market characterized by an booming economy like 2005 when you could barely keep up with the sales volume coming in through the door.
In the third year of our operations, we expect to be in a good place financially after having established ourselves in business for over 2 years.Another item that we have factored into our sales projections is sales seasonality - it is a fairly well known fact in the real estate business that busiest time of the year tends to be the spring and the summer. Once the summer home buying season is over, school starts up and most folks tend to put aside their plans to buy another home for the rest of the year. Indeed many homes are also taken out of the listing service by realtors and business related to home buying tend to slow down. We are projecting that Jose and Dinah will have to deal with
Thus we are projecting that for the third year in a good market condition we will probably be able to get to $720,000 in sales after selling 24 homes each generating about $30,000 in both total profit. In the event the market for real estate financing were to slow down, we are projecting that we will be able to sell 18 homes for the third year that will bring in a total of $540,000. Also in the event we have a refinance boom and actually wind up with a great market condition, we project that Home At Last Realty will be able to take in approximately $900k having sold up to 30 homes in its third year of operations.
The $30,00 profit that we are projecting per home assumes that the market value of our typical home will be approximately $500k and a sales commission of 6%. Since there will be 4 junior realtors besides the two partners, we feel that this gives us plenty of room for these very realistic projections given the vast experience of Jose and Dianna. The junior real estate agents are expected to start contributing streadily to
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