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If you are planning to write the rental service business plan on your own, then this sample rental service business plan can be great for guidance. However, if you are looking for a professional business plan writer for a business loan, SBA loan or to find out the possibility of success for your new business then let’s talk!  

Executive Summary

Overview: CRM takes pleasure in providing its residents with a pleasant and economical living environment. CRM Rental Management, Inc., one of the best property management businesses in the region, is dedicated to excellence while creating creative standards for others to follow. Our residents benefit from the strong collaboration of our trained and highly skilled staff, who offer great living at a reasonable price.

Mission: CRM Rental Management, Inc.’s mission is to raise the bar for outstanding performance and manage residential and commercial properties for the success of our clients while ensuring that all of our tenants enjoy the highest possible quality, comfort, and affordability.

Vision: CRM Rental Management, Inc.’s vision is to continue to be the property management firm of choice by establishing the standard in the multi-family housing, property management, and development sectors by offering comprehensive service and care to our customers, properties, and team members.

Industry Overview: The impact of the worldwide COVID-19 (coronavirus) epidemic in early 2020 on the Real Estate and Rental and Leasing sectors’ performance during the five years to 2021 must be considered. It’s important to remember that the industry had a solid showing at the start of the five years. However, an excess of luxury housing units, falling rent affordability across metro regions, and an operating climate defined by cheap interest, debt-fueled acquisitions, and high financial leverage were all visible symptoms of structural instability in the second half of the present. Operators in the Apartment Rental business have had robust but mostly decelerating growth throughout the five years leading up to 2021. In recent years, the industry’s performance has dwindled. Market fundamentals have deteriorated because of an undersupply of cheap units and an excess of luxury units—the state most of its current revenue increases via market price distortions in the middle market. Due to a decrease in vacancy, industry landlords could charge higher rents, increasing industry income.

Financial Overview:

Financials is one of the most important sections of a rental service business plan. You can get an idea of your projected revenue, required investment amount, is the business sustainable without additional funding, etc.

Financial Highlights:

Liquidity2020A2021A2022F2023F2024F
Current ratio612233242
Quick ratio611223140
DSO88888
Solvency
Interest coverage ratio8.211.114.2
Debt to asset ratio0.010.010.20.180.16
Profitability
Gross profit margin51%51%53%53%53%
EBITDA margin12%14%21%22%22%
Return on asset5%6%13%14%14%
Return on equity5%6%16%17%17%

Fund Usage

Industry Analysis

The industry analysis section of the rental service business plan will help you get better insights into competitors, market growth, and overall industry prospects. You can order a custom market research report for your rental service business.

The average monthly rent in the United States in February 2021 was USD 1,124. Rents rose in all apartment categories over the monitoring period. There was, however, a modest drop as compared to February 2020. In the aftermath of the COVID-19 issue, the worldwide market for Online Home Rental Services is expected to increase at a CAGR of 14.6 percent from 2020 to 2027, from an estimated US$14 billion in 2020 to a revised US$36.3 billion by 2027.

Flats, one of the report’s sectors, is expected to grow at a 16.1% CAGR over the next five years, reaching US$16.9 billion by the conclusion of the study period. Following an early assessment of the pandemic’s commercial effects and the resulting economic crisis, the Semi-Detached Houses segment’s growth is revised to a 14.3% CAGR over the following seven years.

In 2020, the US market for online home rental services was expected to be worth US$4.1 billion. China, the world’s second-largest economy, is expected to reach a market size of US$6.3 billion by 2027, representing a 13.9 percent CAGR from 2020 to 2027. Japan and Canada are two more notable geographic markets, with growth rates of 13.1 percent and 12.3 percent, respectively, predicted for 2020-2027. Germany is expected to expand at a 10.5 percent compound annual growth rate (CAGR) within Europe.

The US, Canada, Japan, China, and Europe are expected to fuel the worldwide Detached Houses segment’s 11.8 percent CAGR. By the end of the research period, these regional markets, which have a combined market value of US$2.7 billion in 2020, will have grown to US$5.9 billion. China will continue to be the fastest-growing in this group of regional markets. The Asia-Pacific market is expected to grow to US$4.3 billion by 2027, led by nations like Australia, India, and South Korea.

The Real Estate Rental Worldwide Industry Report 2022 gives strategists, marketers, and senior management the data they need to analyze the global real estate rental market after the COVID-19 shutdown.

At a compound annual growth rate (CAGR) of 10.7%, the worldwide real estate rental industry is predicted to increase from $2164.29 billion in 2021 to $2396.61 billion in 2022. Companies are reorganizing their operations and recuperating from the COVID-19 effect, which had previously resulted in tight confinement measures such as social distance, remote working, and the shutdown of commercial activities, all of which created operational issues. With a 9.7% compound annual growth rate, the market will reach $3476.58 billion by 2026.

The real estate rental market comprises entities that rent, lease, and enable the use of buildings and land (organizations, single traders, and partnerships). A rental agreement or contract between a product owner and an end-user governs the rental of products or services, in which the end-user pays for the temporary use of the product. A rental agreement is a contract that allows you to rent a place (commercial or residential) for a certain period in return for a monthly fee.

After the COVID-19 shutdown, strategists, marketers, and senior management may use the Real Estate Rental Worldwide Industry Report 2022 to study the worldwide real estate rental business.

The global real estate rental sector is expected to rise from $2164.29 billion in 2021 to $2396.61 billion in 2022, with a compound annual growth rate (CAGR) of 10.7%. Companies are rebuilding their operations and recovering from the COVID-19 impact, which had previously resulted in strict confinement measures such as social distance, remote working, and commercial activity shut down, all of which generated operational challenges. The market is expected to reach $3476.58 billion by 2026, growing at a 9.7% compound yearly growth rate.

While working on the industry analysis section of the rental service business plan make sure that you add a significant number of stats to support your claims and use proper referencing so that your lender can validate the data.

Entities that rent, lease, and allow the use of buildings and land make up the real estate rental industry (organizations, single traders, and partnerships). The rental of items or services, in which the end-user pays for the temporary use of the product, is governed by a rental agreement or contract between a product owner and an end-user. A rental agreement is a legal document that permits you to rent a space (commercial or residential) for a certain length of time in exchange for a monthly fee.

Marketing Plan

A key part of the marketing plan in a rental service business plan is the marketing budget. The growth in the number of customers is proportional to the budget and dependent on the CAC.

Content Marketing: Create a blog on your CRM Rental Management, Inc. website that has material for prospective customers.

Discounts: Create a member referral scheme, where members get a deal if they successfully recommend someone.

Social Media: Engage and promote CRM Rental Management, Inc on Twitter, publish news on Facebook, and utilize Instagram to promote curated photos of your space. Think about if you have a place in your budget for Facebook Marketing or other social media-focused ads.

SEO (Search Engine Optimization) Local SEO makes it easier for local consumers to find out what you have to offer. It creates trust with potential members seeking what your place offers.

Email Marketing: CRM Rental Management, Inc will be sending automated in-product and website communications to reach out to consumers at the right time. Remember that if your client or target views your email as necessary, they are more likely to forward it or share it with others, so include social media share buttons in every email.

Organogram

Financial Plan:

This section of the rental service business plan helps your lender figure out whether you will be able to pay off the loan, whether the business is sustainable, what are the growth prospects, etc.

Earnings:

Break-Even Analysis:

Income Statement:

2020A2021A2022F2023F2024F
ANNUAL REVENUE
Item 19,21759,117175,410415,277781,357
Item 234,701222,558660,3681,563,3942,941,580
Item 34,06719,56146,43278,519114,905
Total annual revenue47,985301,236882,2112,057,1893,837,842
% increase528%193%133%87%
COST of REVENUE
Item 13602,2596,61715,42928,784
Item 24803,0128,82220,57238,378
Item 352,00065,00078,00091,000104,000
Item 47203,6158,82216,45823,027
Item 5140,000336,000560,000840,0001,120,000
Item 660,000144,000240,000360,000480,000
Item 732,00061,33385,533112,153141,435
Total Cost of Revenue285,560615,220987,7941,455,6121,935,625
as % of revenue595%204%112%71%50%
Gross Profit-237,575-313,984-105,583601,5781,902,218
SELLING & ADMIN EXPENSES
Item 128,00096,800154,880175,692193,261
Item 275,000105,000120,000120,000120,000
Item 336,00096,000108,000120,000120,000
Item 48,00012,00012,00012,00012,000
Item 53,83918,07444,11161,716115,135
Item 63,35912,04926,46641,14476,757
Item 75,60010,00012,90415,03417,376
Item 86,66714,00022,06730,94040,701
Total selling & admin expenses166,464363,924500,428576,525695,230
as % of revenue347%121%57%28%18%
Net profit-404,039-677,907-606,01125,0521,206,987
Accumulated net profit-404,039-1,081,947-1,687,957-1,662,905-455,918

Cash Flow Statement:

2020A2021A2022F2023F2024F
CASH FLOW from OPERATING ACTIVITIES
Net profit before tax-$404,039-$677,907-$606,011$25,052$1,206,987
Depreciation$44,267$85,333$120,504$158,127$199,512
Payables
Item 1$4,333$5,417$6,500$7,583$8,667
Item 2$11,667$28,000$46,667$70,000$93,333
Item 3$6,250$8,750$10,000$10,000$10,000
Item 4$3,000$8,000$9,000$10,000$10,000
Item 5$667$1,000$1,000$1,000$1,000
Total payables$25,917$51,167$73,167$98,583$123,000
change in payables$25,917$25,250$22,000$25,417$24,417
    Receivables
Item 1$320$1,506$3,676$5,143$9,595
Item 2$360$1,807$4,411$8,229$11,514
Total receivables$680$3,314$8,087$13,372$21,108
change in receivables-$680-$2,634-$4,773-$5,285-$7,736
Net cash flow from operating activities-$334,536-$569,958-$468,280$203,311$1,423,180
  
CASH FLOW from INVESTING ACTIVITIES
Item 1$16,000$13,200$14,520$15,972$17,569
Item 2$20,000$22,000$24,200$26,620$29,282
Item 3$28,000$22,000$14,520$10,648$11,713
Item 4$96,000$88,000$72,600$79,860$87,846
Item 5$20,000$22,000$24,200$26,620$29,282
Net cash flow/ (outflow) from investing activities-$180,000-$167,200-$150,040-$159,720-$175,692
CASH FLOW from FINANCING ACTIVITIES
Equity$400,000$440,000$484,000$532,400$585,640
Net cash flow from financing activities$400,000$440,000$484,000$532,400$585,640
Net (decrease)/ increase in cash/ cash equivalents-$114,536-$297,158-$134,320$575,991$1,833,128
Cash and cash equivalents at the beginning of the year-$114,536-$411,693-$546,014$29,978
Cash & cash equivalents at the end of the year-$114,536-$411,693-$546,014$29,978$1,863,105

Balance Sheet: 

2020A2021A2022F2023F2024F
NON-CURRENT ASSETS
Item 1$16,000$29,200$43,720$59,692$77,261
Item 2$20,000$42,000$66,200$92,820$122,102
Item 3$28,000$50,000$64,520$75,168$86,881
Item 4$96,000$184,000$256,600$336,460$424,306
Item 5$20,000$42,000$66,200$92,820$122,102
Total$180,000$347,200$497,240$656,960$832,652
Accumulated depreciation$44,267$129,600$250,104$408,231$607,743
Net non-current assets$135,733$217,600$247,136$248,729$224,909
CURRENT ASSETS
Cash-$114,536-$411,693-$546,014$29,978$1,863,105
Accounts receivables$680$3,314$8,087$13,372$21,108
Total current assets-$113,856-$408,380-$537,927$43,349$1,884,214
Total Assets$21,878-$190,780-$290,791$292,078$2,109,122
LIABILITIES
Account payables$25,917$51,167$73,167$98,583$123,000
Total liabilities$25,917$51,167$73,167$98,583$123,000
EQUITIES
Owner’s equity$400,000$840,000$1,324,000$1,856,400$2,442,040
Accumulated net profit-$404,039-$1,081,947-$1,687,957-$1,662,905-$455,918
Total equities-$4,039-$241,947-$363,957$193,495$1,986,122
Total liabilities & equities$21,878-$190,780-$290,791$292,078$2,109,122

Balance Sheet: 

2020A2021A2022F2023F2024F
NON-CURRENT ASSETS
Item 1$16,000$29,200$43,720$59,692$77,261
Item 2$20,000$42,000$66,200$92,820$122,102
Item 3$28,000$50,000$64,520$75,168$86,881
Item 4$96,000$184,000$256,600$336,460$424,306
Item 5$20,000$42,000$66,200$92,820$122,102
Total$180,000$347,200$497,240$656,960$832,652
Accumulated depreciation$44,267$129,600$250,104$408,231$607,743
Net non-current assets$135,733$217,600$247,136$248,729$224,909
CURRENT ASSETS
Cash-$114,536-$411,693-$546,014$29,978$1,863,105
Accounts receivables$680$3,314$8,087$13,372$21,108
Total current assets-$113,856-$408,380-$537,927$43,349$1,884,214
Total Assets$21,878-$190,780-$290,791$292,078$2,109,122
LIABILITIES
Account payables$25,917$51,167$73,167$98,583$123,000
Total liabilities$25,917$51,167$73,167$98,583$123,000
EQUITIES
Owner’s equity$400,000$840,000$1,324,000$1,856,400$2,442,040
Accumulated net profit-$404,039-$1,081,947-$1,687,957-$1,662,905-$455,918
Total equities-$4,039-$241,947-$363,957$193,495$1,986,122
Total liabilities & equities$21,878-$190,780-$290,791$292,078$2,109,122