HomeVestors Franchise Cost, Revenue & Failure Rate 2024

If you’re considering starting your own business, you’re probably wondering how much it will cost. You may have heard of Homestvestors and are interested in learning more about the franchise opportunity.

This blog post will provide an overview of what it costs to start a Homestvestors franchise and what you can expect from the investment.

We’ll also share some tips for how to reduce the initial investment amount. So, whether you’re just getting started or are already researching franchises, this post is for you!

HomeVestors Franchise

About HomeVestors 

HomeVestors of America, Inc., based in Dallas, is a privately held corporation specializing in purchasing older single-family homes that need repair.

After that, the corporation renovates and sells them. The company has used a “seed idea,” starting with a good franchisee and then supporting them with local marketing and promotion to expand into new markets.


HomeVestors Business History

Ken D’Angelo started HomeVestors after 20 years as a real estate agent in Houston and Dallas for Red Carpet Realtors and ERA Realtors.

He saw an infomercial one night in 1989 pitching a two-hour DVD that would educate consumers all they needed to know about home buying.

It gave the 40-year-old the push he needed to break out independently. He opened up the company as a one-person operation in East Dallas and began buying houses at below-market rates.

D’Angelo steadily expanded HomeVestors over the next few years. He was purchasing and selling more than 150 residences each year by 1995.

He then sought to franchise his concept, and in March 1995, he hired Dain Zinn to assist him in this endeavor.

They collaborated to create a franchising model that would set HomeVestors apart from the competition and help them market the concept to potential franchisees.


HomeVestors Franchise Model

Cost Or FeeAmount
Initial Investments  $53,000 – $421,250  
Liquid Cash Requirement:$53,000 – $421,250  
Initial Franchise-Fee $27,000 – $65,000  
Area RequirementN/A
Total Outlets60

Why Should You Choose HomeVestors Franchise?

Why Should You Choose HomeVestors Franchise

Investors looking to develop wealth can take advantage of HomeVestors’ low-cost franchising opportunities.

A software system that franchisees use to analyze single-family homes for buy and repair; a direct-selling program that assists franchisees in identifying purchasers or investors who already have a stake in the neighborhood are part of its unique business model.

HomeVestors franchisees produce good cash flow and equity with the company’s ongoing support.

They amass real estate portfolios and riches by purchasing investment-grade single-family homes at bargain prices, rehabilitating them, and selling or renting them out.

You Will Also Get The Following Benefits As A HomeVestors Franchisee:

  • Financing for the purchase and restoration of dwellings that meet specific criteria.
  • Next, Vacant property insurance through a third-party insurance vendor at group rates.
  • HomeVestors website for information and a website managed by HomeVestors for HVA franchisees to assist them in selling properties

HomeVestor franchise can be counted amongst the 10 best franchises that you can own under $100k.


HomeVestors Franchise Revenue & Profit

HomeVestors does a great job at selling people’s houses for a great price. But is HomeVestors profitable?

There is not much information available about the yearly profits of a HomeVestors franchise. However, we do know that a HomeVestors franchise owner makes $603,000 in revenue per year on average.

So, if we assume a profit margin of 15%, then we can say that HomeVestors franchise owners make net profits of $90,450 yearly on average.

This is how we calculated this amount:

Financial OverviewPercentage of RevenueAmount ($)
Individual Franchise Annual Revenue100%603000.00
Rent10.63%(64068.75)
Insurance5.31%(32034.38)
Salaries21.25%(128137.50)
Franchise Royalty Fees5.31%(32034.38)
Utilities2.13%(12813.75)
Cost of Goods Sold (COGS)26.56%(160171.88)
Labor (Variable)13.81%(83289.38)
Total (Expenses)85.00%(512550.00)
Net Profit15.00%90450.00

Note: The displayed expenses are estimates based on industry averages and standard costs. Actual expenses may vary due to factors like location, business size, and market conditions. We recommend conducting detailed research or consulting with a financial advisor for a tailored financial analysis.


Payback Period Of HomeVestors

With an investment of $421,250 and an estimated 15% profit on the average revenue, the yearly profit would be $90,450.

So, to find out how long it will take to earn back the initial investment:

Payback Period = Investment / Yearly Profit = $421,250 / $90,450= 4.6 years

Based on these figures, it will take approximately 4-5 years to pay back the initial investment for HomeVestors. This time period could be longer or shorter depending on your sales, revenue, and profit figures.


Failure Rate Of HomeVestors

Franchised Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
20201,1131,148+35
20211,1481,154+6
20221,1541,144-10

For the Franchised outlets:

  • In 2020, the growth rate was (35)/1,113×100≈3.14%
  • In 2021, the growth rate was (6)/1148×100≈0.52%
  • In 2022, the failure rate was (10)/1154×100≈0.86%

Company-Owned Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
2020000
2021000
202203+3

For the Company-Owned outlets:

  • In 2020, the failure rate was (0)/0×100≈0.00%
  • In 2021, the failure rate was (0)/0×100≈0.00%
  • In 2022, the growth rate was (3)/0×100≈0.00%

Total Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
20201,1131,148+35
20211,1481,154+6
20221,1541,147-7

For Total outlets:

  • In 2020, the growth rate was (35)/1,113×100≈3.14%
  • In 2021, the growth rate was (6)/1148×100≈0.52%
  • In 2022, the failure rate was (7)/1154×100≈0.60%

According to the above-mentioned data, we can see that the franchised outlets for HomeVestors grew from 2019 to 2021, showing a growth rate between 3.14% and 0.52%. The company experienced a failure rate of 0.86% in the year 2022.

On the other hand, for company-owned outlets, the failure rate of HomeVestors at the start of the year 2020 was 0.00%, but the company gradually increased the number of outlets in the year 2022, experiencing growth.

Overall, when we combine the data of franchise and company-owned outlets, we can see that the HomeVestors franchise has expanded in the years 2020-2021, showing a total growth rate between 3.14% and 0.52%. However, in the year 2022, the number of outlets decreased, showing a failure rate of 0.60%.


HomeVestors Franchise Training & Support

HomeVestors offers one of the most outstanding franchise support systems in the industry.

A new Associate Franchisee or Full Franchisee is assigned a Development Agent (DA) mentor after completing a week of fundamentals at HomeVestors’ initial training in Dallas.

  • Learn to know the worth of a home and the required repairs.
  • Learn to use the local ad councils to generate consistent leads.
  • Calling scripts, setting and attending appointments, and negotiating the purchase are all available as role-play scripts.

Aspiring entrepreneurs in the dealership franchise realm have choices like U-Haul franchise to consider.


HomeVestors Comparison

CompanyHomeVestorsU-Haul
Founded In19891945
Initial Investment$53,000 – $421,250N/A
Franchise-Fee$27,000 – $65,000  N/A
Total Outlet6050
Annual Revenue$1.6 Billion$4.54 Billion

Frequently Asked Question 

What kind of marketing assistance and programs do they provide?

Thanks to effective marketing methods and a level of brand knowledge that solo investors lack, you’ll have a consistent stream of qualified leads for our franchisees.

What is the business model for a franchise?

The HomeVestors of America brand specializes in purchasing, repairing, and selling distressed properties as rapidly as possible.

Is HomeVestors a franchise?

Yes, HomeVestors is a franchise organization.

How much does a HomeVestors franchise cost?

The initial investment required to open a HomeVestors
franchise is $53,000 – $421,250, and the franchise fee required is $27,000 – $65,000.

Who owns HomeVestors?

HomeVestors of America Inc., which is best known for its “We Buy Ugly Houses” marketing campaign, is acquired by Bayview Asset Management in 2022.

Where is HomeVestors headquartered?

HomeVestors is headquartered in Dallas, Texas.

How Many Locations Does HomeVestors Has?

The company operates in 45 states with over 1000 franchises and still growing.

Who founded HomeVestors?

Real Estate Agent Ken D’Angelo founded HomeVestors in 1996 and began franchising in the same year.

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