WHY PROPERTY DEVELOPMENT?
When you become a property developer, you:
- Save money – your project could cost 20% below market value
- Make money – you could make large development profits
- Get better rental returns – which helps pay the mortgage
- Obtain easier finance – on completion giving you better leverage
- Achieve great tax benefits – from new property
Becoming a property developer allows you to acquire high performance properties “at wholesale” (with built in capital growth) and ones that are cheap to own.
This helps you build your property portfolio faster and safer than the average investor.
What is Property Development?
Property Development involves a wide range of activities and processes from purchasing land to building and developing facilities.
One definition of property development is “the continual reconfiguration of the built environment to meet society’s needs.”
While this can be anywhere from roads to high-rise office buildings, this article will discuss a specific segment – the “average” investor working on small to medium-sized residential development projects.
What’s required of a Property Developer and why get into Property Development?
In order for a Property Developer to be successful, need to have the ambition and patience that the process requires.
They also need more knowledge than they may think – there’s things they already know, things they know they don’t know, but as soon as you get into your first project you’ll also stumble on lot’s you didn’t even know you didn’t know!
As a developer, you’re an investor committing your equity, expertise and talents to convert land from its current use to a higher and better use.
So you’ll need to educate yourself on property, the markets, economics, finance, town planning, the construction processes and the marketing of real estate projects.
Some of this you can learn by doing your homework and other lessons you’ll learn along the way.
In order to be successful, you need to start small and work your way up.
Most of your mistakes will be made with your first few projects so it is important to start small so you don’t ruin your property investment career before it has even begun.