# HomeVestors Item 19 Deep Dive: $287K Median Across 898 Franchises > HomeVestors (We Buy Ugly Houses) Item 19: $287K median across 898 franchised territories in 2024. Why real-estate-investing franchise economics differ from operating franchises, and what buyers should underwrite. **Last updated**: 2026-06-05 **URL**: https://vetmyfranchise.com/blog/homevestors-item-19-deep-dive?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md > **Quick answer:** HomeVestors (the "We Buy Ugly Houses" franchise) reports a $287K median revenue across 898 territories — but the number means something different here than at operating franchises. HomeVestors franchisees are real-estate investors using the brand's marketing system and deal-evaluation tools. Revenue is deal proceeds, not operating revenue. Per-deal economics, capital recycling speed, and local-market real-estate dynamics determine unit profitability — not the annual revenue figure. Underwrite this as a real-estate investment business with a franchise-system overlay, not as a conventional franchise. ## The Disclosure HomeVestors' most recent Item 19: | Metric | Value | |---|---:| | Sample size | 898 franchised territories | | Sample criteria | Franchised units operating all 12 months of 2024 | | Reporting period | January 1, 2024 - December 31, 2024 | | Median annual revenue | $286,884 | | Total system units | 981 | | Total investment (Item 7) | $150,000 - $477,250 | | Franchise fee | $85,000 | | Royalty rate | 0.8% to 3.0% | | Ad fund | $300 (flat monthly) | The 898-territory sample with the full-12-month filter is methodologically conservative. The disclosure represents franchisees who operated as established businesses during the entire calendar year 2024 — excluding ramp-stage operators. The royalty structure is unusual: 0.8-3.0% sliding scale plus a flat $300/month ad fund (not a percentage). The flat-dollar ad fund makes sense in a deal-based business where revenue varies enormously deal-to-deal; a percentage-of-revenue ad fund would produce unstable franchisor cash flow. ## Why HomeVestors Revenue Doesn't Behave Like Operating Revenue Most franchise Item 19 disclosures describe operating revenue: customer transactions × average ticket = annual sales. HomeVestors revenue is structured differently: **Revenue source 1: Retail flips.** Franchisee buys a distressed house (say, $80K), renovates ($30K-$60K of materials and labor), sells at retail (say, $180K). Revenue recorded in Item 19 is typically the resale proceeds. Per-deal "revenue" might be $150K-$300K, but the franchisee's actual gross profit is $20K-$60K after accounting for acquisition and renovation costs. **Revenue source 2: Wholesale assignments.** Franchisee puts a distressed house under contract at a low price, assigns the contract to a cash investor for a fee. No actual purchase or renovation — just the assignment fee. Per-deal revenue might be $5K-$25K with minimal capital deployed. **Revenue source 3: Hold-and-rent.** Some franchisees acquire distressed properties for rental portfolios. Item 19 revenue may include rental income on held properties. A $287K median revenue could represent any of these patterns: 1-2 retail flips, 10-20 wholesale assignments, or some mixed model. The same revenue figure represents materially different underlying businesses depending on the mix. For a buyer, this means **the median is essentially an indication of activity volume, not of profitability**. Two franchisees at the same revenue could have radically different net incomes. ## The Capital Structure Buyers Often Underestimate The Item 7 investment range of $150K-$477K covers the franchise setup costs: franchise fee ($85K), training, marketing setup, initial advertising commitment, and operating reserves. **It does NOT include the working capital required to actually buy houses.** Typical real-world capital requirements: - $150K-$477K of Item 7 franchise capital - $80K-$300K per active deal for acquisition (sometimes financed, sometimes cash) - $30K-$80K per active deal for renovation - 4-8 active deals at peak operating capacity - Total active-capital deployment: $500K-$2M+ Most franchisees finance the acquisition capital through: - HomeVestors-affiliated lender relationships (the franchisor provides lender access) - Local hard-money lenders - Conventional investment-property financing (limited applicability for distressed properties) - Personal capital and home equity Buyers evaluating HomeVestors must underwrite **two capital decisions**: the franchise setup capital ($150K-$477K) and the operating capital required to run the deal business ($500K-$2M+). The franchise economics work only if both capital pools are available and properly cycled. ## How HomeVestors Compares to Real-Estate / Investment Franchises | Brand | Sample | Median AUV | Investment | Business Model | |---|---:|---:|---|---| | HomeVestors | 898 | $287K | $150K-$477K | House investing | | Keller Williams (broker) | larger | varies | $48K-$76K | Real estate brokerage | | RE/MAX (broker) | larger | varies | $39K-$245K | Real estate brokerage | | [Two Maids](/franchise/two-maids-franchising-llc?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md) & A Mop | smaller | $400K-$600K (est.) | $80K-$140K | Cleaning services | | [Real Property Management](/franchise/real-property-management-spv-llc?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md) | smaller | $500K-$1.5M (est.) | $90K-$120K | Property management | | [HouseMaster](/franchise/housemaster-spv-llc?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md) | smaller | $200K-$400K (est.) | $65K-$98K | Home inspection | HomeVestors is unique among real-estate-adjacent franchises in that it's a principal-investing business, not a service or brokerage. Comparable franchises (brokers, property management) operate as service businesses with different unit economics, capital structures, and risk profiles. The closest conceptual peer is no longer franchised — it's the broader independent real-estate-investing community. ## Year-One Reality A new HomeVestors franchisee in months 1-12 typically generates: - Months 1-3: $0-$30K monthly revenue (marketing build, first leads, initial deals) - Months 4-6: $20K-$60K monthly revenue (first completed deals, lead pipeline) - Months 7-9: $25K-$70K monthly revenue (deal velocity establishing) - Months 10-12: $30K-$80K monthly revenue (operations stable) - Annualized year-one: $145K-$220K That's 50-75% of system median. Year-one ramp is constrained by: 1. Marketing campaign establishment (TV, direct mail, online — 60-90 days to first lead flow) 2. Deal pipeline development (typical 90-180 day cycle from lead to closed deal) 3. Capital recycling — early deals tie up working capital, limiting concurrent deal capacity 4. Learning curve on deal evaluation and renovation management Year two typically reaches the system median. The strongest franchisees ($1M+ annual revenue territory) typically: - Operate in markets with strong distressed-property supply (older housing stock, economic distress markets) - Build local contractor relationships for cost-efficient renovation - Develop wholesale-buyer networks for fast turn assignments - Operate as multi-territory or multi-team businesses ## What This Means for Buyers - **Treat this as a real-estate business with a franchise overlay, not a typical franchise.** The brand provides marketing leverage and deal tools; the franchisee runs an independent real-estate investing business. - **The Item 7 investment vastly understates required capital.** Plan for $500K-$2M+ of working capital beyond the franchise investment to actually run the business at scale. - **Per-deal economics matter more than revenue.** A $287K revenue franchisee doing 3 retail flips at $40K each is in a different business than a $287K revenue franchisee doing 15 wholesale assignments at $19K each. Underwrite the deal-mix model that fits your skills and capital. - **Local market dynamics dominate.** Distressed-property supply, renovation labor cost, real-estate market liquidity, and resale demand vary materially by geography. The brand's lead-generation system works; the deal economics depend on local market structure. - **Operator profile fits real-estate-savvy operators.** Construction experience, real-estate investing background, or strong project-management skills are essentially prerequisites. Franchisees without these capabilities typically fail or underperform regardless of brand support. For broader category context, see our [real estate franchise breakdown](/blog/best-real-estate-franchises?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md) and [Item 19 average vs. median](/blog/item-19-average-vs-median-survivorship-bias?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md). For brand-specific cost detail, the live [HomeVestors franchise page](/franchise/homevestors-of-america-inc?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md). ## Brands mentioned in this post - [Real Property Management](/franchise/real-property-management-spv-llc?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md) - [HouseMaster](/franchise/housemaster-spv-llc?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md) - [Two Maids](/franchise/two-maids-franchising-llc?utm_source=claude&utm_medium=ai_referral&utm_campaign=vmf_agent_md)