Establishing a real estate niche is a strategic way for agents to develop authority and expertise, enabling them to stand out from the competition. Agents who work with real estate niches more efficiently maximize their marketing efforts and multiply their income. Establish a real estate niche in any real estate market area where you see a need—from location and property types to clientele. We’ve collected 10 of the most lucrative categories of real estate niches to help you establish a strategy, optimize your time, and establish yourself as an expert.
1. Location
The most common real estate niche is based on location, focusing on properties and clients within a specific neighborhood, city, ZIP code, or county. Location-based real estate specialties are also called “farm areas.” Choosing the right farm area is key because an area that is oversaturated or undervalued will limit your potential. Ideally, you’ll choose an area near your current home that you already have some knowledge of. For example, instead of targeting all of Manhattan, choose a neighborhood like the West Village to be more focused.
Once you’ve identified the right location, carefully select the right marketing tools to become more efficient. For example, Offrs uses predictive analytics to provide exclusive listing leads before your competition knows about them. The incredibly accurate market data helps you market to clients, contact them before other agents, and easily gain more listings in your desired region. Start using Offrs to build authority in one of the most profitable real estate niches.
Tips to Build a Location Niche:
- Learn about the demographics in your target area to improve your real estate marketing plan
- Research the varying property types in your area, prices, and real estate market trends
- Research other real estate agents and sales techniques that are effective
- Build local connections, including your sphere of influence (SOI) and other real estate professionals
2. Property Type
Property types are another example of common niches in real estate, especially since there is such a wide variety. Working with niche properties allows you to become an expert on individual property types’ structures, details, and values. In turn, this makes you a valuable resource for buyers and sellers of those properties.
A few property types you could choose for a real estate niche include the following:
- Single-family homes: Free-standing residential structure that sits on its own land.
- Multi-family homes: A single building with multiple units for more than one family living separately.
- Condo (condominium): An individually owned residential unit in a building complex with like units.
- Co-ops: Specific to New York, this is a type of property owned by a corporation made up of the owners within the co-op.
- Commercial real estate: Consists of buildings used for commercial purposes, including office buildings, warehouses, retail buildings, and many others.
- Historic homes: Homes over 50 years old and connected to a historical event, notable individual, or historical style, or which provide other types of historical information.
Keep in mind that the most profitable property niche depends on your area. Using Zillow’s search filters, look up how many different property types are available and how many have recently sold within your chosen area. For example, 79% of property sales in 2022 and 2023 were single-family homes. This means focusing on apartments, condos, and townhomes would not be profitable in many areas. However, in areas like Brooklyn, New York, research shows over 500 condos sold within 90 days, with over 300 currently for sale. Choosing a property type with consistent inventory is key to finding the right real estate niche.
Tips to Build a Property Type Niche:
- Research the most common property types in your farm area and choose one that is in demand and interesting
- Learn about the demographics of the owners to target buyers and sellers
- Research specific home features that appeal to buyers
- Connect with contractors in the area to learn about common problems in each specific property type
- Share educational information about your selected property type on social media, in emails, or on your real estate blog
3. Specific Types of Buyers
Being a buyer’s representative can be extremely lucrative—86% of buyers in 2023 purchased their home with the help of an agent. Although this is one of the most common real estate agent niches, it can also be segmented into smaller categories. For example, buyer real estate niches may include the following:
- First-time homebuyers: Buyers looking to buy their first homes—this category made up 26% of all homebuyers in 2023.
- Luxury buyers: These are high net worth individuals, many of whom already own multiple properties or upscale properties. As a luxury real estate agent, you’ll frequently help them purchase multiple residences to spend time in throughout the year.
- Investors: Real estate investors specialize in buying and selling property, so while they’re receptive and attentive, they are also usually very savvy. Unlike homebuyers looking for a dream home or place to start a family, investors are usually seeking out properties with the potential to gain value quickly.
- Commercial/retail buyers: Commercial property buyers are often business owners (or their representatives) looking for space for their operations. Business types can range from retail stores, restaurants, office spaces to storage spaces, and anything in between.
- Rent-to-own: The rent-to-own buyer isn’t ready to buy yet. They may not have sufficient financial means to make a down payment or a poor credit score, which limits their ability to get a mortgage. However, they want to invest in a property with the long-term goal of ownership rather than simply renting a home without building any equity.
Understanding the needs of each type of buyer should determine your strategy to generate real estate leads. For instance, first-time homebuyers generally need more communication and resources about how buying a home works. On the other hand, marketing to real estate investors should be more focused on showing your ability to evaluate investment properties, understand financial calculations, and find distressed homeseller leads.
Once you start narrowing down your real estate niche ideas, make sure you have a plan and the right tools to build a lead-generating system. If you don’t already have a repeat or referral system, Market Leader can help you easily and efficiently create one. The platform provides exclusive leads, a website, marketing materials to generate more organic leads, and a robust customer relationship management (CRM) tool to help you stay connected to past clients and new leads. Use Market Leader’s customizable email and text marketing tools with different types of buyers to engage and nurture them as clients.
Tips to Build a Buyer Niche:
-
- Define your buyers’ common questions and pain points so you can address them in your marketing materials
- Research the first step your target audience takes when they’re considering buying a home and focus your lead generation efforts there
- Use Zillow Premier Agent to target a high volume of local buyer leads
- Build an IDX website for buyers to search for listings
- Create real estate community pages to build authority about your local neighborhoods
4. Specific Types of Sellers
Another one of the best markets for real estate agents is homesellers. Like the buyer niche, specializing agents can work with sellers of all types to further segment their niche. Representing sellers requires a distinct skill set to sell properties successfully and target homeowners who want to sell.
Real estate seller niches can include the following:
- Multi-family building owners: They own multi-family buildings and are looking for an agent to represent their rental portfolio, also known as landlords.
- Home-flippers: They purchase distressed homes so they can renovate and make a profit when sold.
- Single-family investors: Investors who purchase homes to use as rental properties.
- For sale by owner (FSBO): A homeowner trying to sell their property without the use of a real estate agent.
- Life event sellers: A life event has occurred, like marriage, baby, divorce, increase or decrease in income, or death, requiring the need to sell to move (to a larger or a smaller home) or offload assets.
- Sidelined sellers: Homeowners waiting out the current market to list their property.
Statistics show that 86% of sellers in 2023 worked with a real estate agent, so you can be confident that this niche is in demand. However, generating seller leads can present challenging obstacles for new or inexperienced agents. For example, homesellers have already participated in at least one real estate transaction, making them less likely to search for or reach out to a new agent. In fact, 63% of sellers work with a referral or the same agent who helped them purchase their home.
Tips to Grow a Seller Niche:
- Research what your homesellers do when they’re considering selling their home
- Send direct mail, like real estate farming postcards, to homeowners in your geographical target area
- Create real estate newsletters with market reports to keep homeowners informed
- Offer comparative market analyses (CMAs) to homeowners
- Define homeowners’ common questions and pain points about selling
- Use real estate photography to share listing photos and successful sales on social media
5. Situational Transactions
In addition to typical real estate transactions, there are many instances when a property is sold under unique circumstances. These are considered “situational transactions” and usually require more specific skills and knowledge from the agent—making it an ideal real estate agent specialty.
A few examples of situational transactions include the following:
- Short-term properties/vacation rentals: Furnished properties in which the owners rent to short-term tenants.
- Short sales: A property being sold for less than the amount due on the mortgage (usually requires lender approval).
- Green/eco-friendly: A home designed and built with environmentally friendly materials and appliances and often with sustainable energy solutions.
- Relocation: A person moving or being relocated by a company or business they work for, usually with a Corporate Relocation designation from the National Association of Realtors (NAR).
- Work-from-home: Buyers who have a remote job and need dedicated space in their home that will function effectively as a private office.
Each situational transaction has a very specific process to complete, which means that clients need an expert to guide them through. These niches may take more effort to learn about initially, but the leads are more likely to convert if you have proven experience in these areas. In addition, the commission structure of these deals can vary. These are great supplemental deals that can be in addition to traditional real estate deals, and many are quite lucrative.
Getting clients within a situational niche will require creative marketing targeted to attract highly specific clientele. To help you create effective marketing materials, PostcardMania provides customizable templates for direct mail and online campaigns like Google and Facebook ads. It will help you reach targeted client types even if you don’t have a large marketing team or budget.
Tips to Build a Situational Niche:
- Research common types of situational transactions to find what is in demand in your area
- Determine how to find the target audience for your selected transaction type
- Consider getting a real estate certification or designation to build your credibility
6. Real Estate-owned (REO) & Foreclosures
Real estate-owned (REO) and foreclosure listings are two different types of properties that a lender owns. There are challenges to entering this market since most properties are in poor condition, and you’ll be working with banks and mortgage companies instead of typical buyer or seller clients. However, if you can obtain REO and preforeclosure leads, it can be incredibly lucrative with a low level of competition.
If you’re interested in this real estate niche but don’t have any experience, start by reading our guide to Foreclosure & REO Listings: Differences & How to Get Them.
One of the best ways to generate foreclosure leads is with a specialty lead generation platform like REDX. REDX finds preforeclosure homes more quickly and efficiently than other platforms and provides you with the contact information to get in touch with distressed owners. It also includes a comprehensive customer relationship manager (CRM) that organizes and tracks your contacts to make sure you are in communication with all prospective clients.
Tips to Build a REO & Foreclosure Niche:
- Build a thorough understanding of the real estate market and property values in order to negotiate with lenders
- Work with a real estate mentor or team with this specialty
- Target distressed property owners or work with wholesalers
7. Rental Properties
In highly populated metropolitan areas, the cost of purchasing a home is higher than the median income. This means that members of urban areas are more likely to rent a home instead of purchasing, which presents another potential niche market for real estate agents.
Examples of rental property real estate niches include the following:
- Room rentals: Renting individual rooms instead of the entire unit.
- Student housing: Off-campus housing can be more affordable than on-campus.
- Full-service apartments: Luxury high-rise units that are amenity-filled, including a doorman, gyms, laundry, public gathering spaces, and parking.
- Multi-family apartments: An entire building dedicated to rentals of separate housing units.
- Single-family residences: Individual homes purchased or built on a standalone lot for individuals or families to rent; these were often initially primary residences for the owners who now want to build equity through renting rather than selling.
To start evaluating whether rentals could be a good niche marketing real estate option for you, consider the number of renters and rental units in your area and the demand for agents to help. Perform a rental market analysis (RMA) to determine if rental properties could be a profitable real estate niche for you.
Tips to Build a Rental Property Niche:
- Research the local rental market and find how many and what type of rental properties are available
- Network with landlords and real estate investors online and in person
- Market to renters through social media, direct mail, and real estate ads
8. Hospitality
A hospitality property is a real estate development with individual rooms for short-term occupancy, like a hotel, motel, extended stay property, or even a conference center. If you choose this type of commercial real estate niche, you’ll likely be focused on working with and marketing to sellers and investors.
Leasing commercial real estate can be complex, and the hospitality niche, in particular, consists of long-term projects that result in higher commissions due to the value of the real estate properties involved. This usually means that agents only focus on one deal at a time.
However, there is a high level of expertise required. Selling a large property like this is a labor-intensive process requiring an agent or team to evaluate the physical condition of a hotel, provide improvements to increase value, and have the ability to understand financial records to help expedite the closing of these large-scale deals.
Tips to Build a Hospitality Niche:
- Build a network of commercial real estate investors and related professionals
- Host and attend events and conferences to make valuable connections
- Market directly to investors and owners through email marketing
9. Communities
Another uncommon real estate specialty is working in specific types of communities, such as retirement, golf, or ski communities. Like most profitable real estate niches, the success of this niche heavily depends on your location. For example, California, Washington, and Florida are the three states with the highest number of retirement communities. If you live in an area where communities are in demand, developing this specialty can be extremely valuable.
One benefit of this real estate niche is that properties in these communities are usually priced higher than similar properties because there are built-in amenities like golf courses, pools, and recreation centers. In addition, clients looking to purchase in these areas are accustomed to a level of quality service, and their networks and connections run deep. Agents who successfully build a strong reputation in these communities generally develop a real estate referral system that keeps their pipelines full.
Tips to Build a Community Niche:
- Learn about the community types in your area and reach out to the owners or leadership team to build personal relationships
- Get involved in community events and learn about the amenities and activities within the communities
- Use real estate signs to build brand recognition within the community
10. Exterior Amenities
Depending on your location, you may have the ability to specialize in properties with specific land or exterior amenities that attract a particular type of clientele. A few examples of these types of properties are:
- Lakefront property: Homes along the shore of a lake or adjacent to a lake.
- Mountain homes: Homes built within a mountainous area.
- Ocean or beachfront property: A property located along the coastline that is right on the beach or at least has ocean views.
- Farmhouses: Large plot of land with the intent to focus on agriculture.
- Vacant land: An empty lot, often bought or sold by commercial real estate investors or developers.
Only select markets contain the above property types, but they provide an opportunity for a unique niche with homes that are typically priced high. These real estate agent specialties require you to learn specific information and details about the property type or location-specific property considerations. Still, they can significantly differentiate you from the competition and build a strong real estate brand.
Tips to Build a Niche in Exterior Amenities:
- Research the lifestyle choices and goals that set these homeowners and buyers apart from others, like waterfront homebuyers or ski property buyers
- Develop an intricate understanding of these buyers and sellers to market more effectively to their desires
- Partner with specialty business owners to build a network and brand recognition, like a ski shop or jet ski rental company
Why It Is Important to Find Your Real Estate Niche
Having a real estate niche isn’t a requirement. In fact, many successful real estate agents prefer working with different types of clients on different transactions, so they provide various services. However, if you want to simplify your real estate prospecting strategy, be viewed as an expert in your community, and build an authoritative reputation more quickly, choosing a real estate niche is the best way to do it.
A few reasons why real estate niches help you more efficiently develop authority include the following:
Differentiate Yourself From Generalists | Homebuyers and owners can find multiple real estate agents in a matter of minutes. To be able to stand out from the crowd, you need a clear differentiator. Having a well-defined real estate niche sets you apart. |
Become the Go-to Agent for Specific Clientele | Think about how local homebuyers or sellers will view you if they see that you have successfully helped other people buy or sell a property exactly how they want to do it. Instead of being one of many real estate agents in the area, you instantly become the go-to agent for their needs by developing a niche. |
Become Highly Skilled | When all of your clients fit within one category, you’ll quickly develop valuable expertise about those properties and clients. This will not only minimize the research, time, and effort you put in but will also make you an even more valuable resource to your clients. |
When figuring out how to find your niche in real estate, start by evaluating your past and current clients. If you’re a brand-new real estate agent, don’t choose a real estate niche until you’ve completed a few deals successfully. Don’t try to force a real estate niche or rush to choose one. Instead, pay attention to your first few transactions or previous clients and determine some of your strengths, weaknesses, and potential gaps in the market. In many cases, a niche might identify itself based on the needs you meet in your community.
Learn more about the saturation of real estate professionals, average agent incomes, and more important data in our guide to the 10 Best States for Real Estate Agents (& 5 Worst States) 2023.
Frequently Asked Questions (FAQs)
A niche in real estate refers to a specialized market segment that a real estate agent focuses on serving and marketing to. A few well-known real estate niches include buyers’ representatives, sellers’ representatives, and commercial real estate niches. However, many other unique specialties exist, like vacation rentals, expired listings, foreclosures, and relocation.
There are currently over 1.5 million realtors in the U.S., but saturation depends on your location and market conditions. However, becoming a successful real estate agent in any market is possible by differentiating yourself and targeting a specialized audience.
Developing a profitable real estate niche starts by evaluating the needs of your audience, gaps in the market, and your personal strengths, weaknesses, and interests. It’s important to complete at least a few real estate transactions in your potential niche and outside of it to gain an understanding of the field. Once you’ve established the specialty you want, consider getting a real estate designation or certification, or simply start marketing to your target audience.
Bottom Line
There are thousands of different types of opportunities in real estate, so no individual agent can be a jack of all trades. Finding a real estate niche that you are passionate about is vital to building a successful real estate career. Your niche can be somewhat general, like residential homebuyers or extremely specific, like oceanfront sellers. By evaluating this list and your local market and audience, you’ll be able to choose the most profitable real estate niche for your business.