Owning property is a great way to establish long-lasting, generational wealth. Developing property, however, is a whole other league of wealth and can lead to some serious prosperity for you and your family. If you’ve worked hard and know the ins and outs of things like property management or construction, then it’s time to move forward from that real estate profile and into real development.
What Does it Mean to Be a Property Developer?
Being a property developer means that you select and then buy sites where you then build housing. It’s an essential role in helping the country’s housing crisis and can be a great way for you to build up some serious wealth. You can develop the properties and then sell them outright, or you can build condos or apartment buildings where you continue to own and manage the overall building, but the individual apartments are either sold or rented out for a high value.
The best part about this type of business is how many hard assets you accumulate over time, especially if you continue to manage the buildings you develop. Yes, you do need to have significant upstart costs. While you can get commercial private financing for a new build project, those loans typically only cover the actual cost of construction and development, and usually only up to 90%. This means you still need to be able to buy the land outright and then contribute towards the development costs. So long as you have that, however, then you can make a big and bold new move for your career and prosperity by following these top tips:
Have Upstart Cash
Though you can get funding for your project, that doesn’t mean you can go in with no assets or savings and get all the money in the world to see your project through. You will need to have some sort of collateral and wealth to your name to get into the property development game. If not you, then you will need to be backed by an investor. For example, you could be a genius architect who has come up with a stunning property development project and are looking to bring it to life. You can sell that project to an existing property developer or look into angel investors to start up your own property development company. Either way, someone will need to be backing to you. This may be done by yourself or an investor.
Before you get too deep, getting approvals for your project in question is a good idea. Getting approvals to tear down a community center can be caught up in a lot of red tape, for example, no matter how underfunded or poorly maintained the property was. There will likely need to be redesigns and changes made to your plan as well before it’s approved. Working on getting your project approved ASAP can speed up the project and get everything underway faster.
Be a Master Project Manager
You need to know the ins and outs of what everyone on the projects are doing. This means you must be on the ground regularly, in constant communication with your construction manager and contractors, and in good standing with all of your suppliers. Automation and effective project management tools can make this easier, but you will still need to have exceptional project management skills to see your first development come to life swiftly.