Real estate development can bring you tremendous amounts of success. The big names in real estate development are among the wealthiest people in the world. (One of them, like it or not, is currently the President of the United States!) So there’s definitely a thrilling element of wealth, even rock ‘n’ roll, to a career in real estate development. If you’re looking to advance from real estate investment to real estate development, then it can certainly be a smart move – but how do you get it right?
Let’s take a brief look at some of the essential elements you need to consider if you want to make a big impact in this field. We’re going to assume you’re starting from the ground up as opposed to taking over an established business in the sector!
Do your research
Real estate development is a tricky business, and it’s worth deepening your knowledge of the field before you start to make any big steps into it. A lot of newcomers to this field come from the real estate investment arena and make the mistake of thinking their knowledge in investment will be all they really need. Budding developers should be willing to sit down and read big and informative books that really spill the beans with regards to the methods and skills required to make it in this business. You’ll have to grapple with more complexities with law and construction than you did in real estate investment.
Let’s say you’ve got a bunch of capital and you want to get into this endeavor without having had experience in investment or development. Unfortunately, this is probably a mistake! While you’re understandably eager to get started, it’s pretty essential that you get some hard experience working for an employer in the real estate business.
Get the right equipment and contacts
Real estate developers tend to start from the ground up when it comes to real estate projects. You’ll purchase a plot and build on top of it. This is why you need to get to grips with some of the complexities of construction. If you’re looking to get this done yourself, then you’ll need certain pieces of equipment; excavators, for example. This can be the case even if you’re altering real estate that you’ve purchased as-is. If you need another company to help you out with construction, then you need to get some networking completed in order to ensure you’re working with a business that will help strengthen your reputation as a trustworthy real estate developer.
Understand the different types
If you’ve worked in pure investment, then you’re probably already familiar with the differences between commercial real estate and residential real estate. But when it comes to actually developing such properties, you need to take new information and skills on board. You need to know precisely what kind of residential real estate is required in a particular location. If you’ve got a plot of land, you could either create a few houses or a hundred apartments. Which one will create more profit? It depends on where exactly the land is situated and what the demand is like in the area. Understand these differences!