Over the years, Property Development has become quite a lucrative career path for many. However, many tend to jump right into it without any preparation which can have a negative effect on their finances. You’ll need to educate yourself on the property, the present markets, the finance, town planning laws, the construction processes and the marketing of real estate projects. Here are a few guidelines to get you started:
As the norm goes, location does mean everything in Real Estate. However, a good location isn’t necessarily the priciest part of the town. It could very well be on the fringes of the center of the town and close to facilities like the market, school and public transport. A time-proven method is to keep looking: walk around, drive around and keep looking for that perfect spot or building. Keep your potential buyer in mind while scouting.
Profits while buying, not selling
You need to bring down the asking price by as much as you can since this is where you will make your money. Auctions are a great place to get a great bargain. However, with auctions, always set your limit before you participate to avoid over-bidding. When buying directly, look for motivated sellers, who will be open to negotiations as they need to sell. Most of these sellers usually try to sell their properties themselves, so, keep a lookout for newspaper ads.
Research and educate yourself
Whether you are a first-time buyer or a pro at it, solid research needs to back your plans. Study the area, the present market fluctuations, the laws, the prices of material and also talk to established developers. Also, while buying a property, ensure you research well into the reasons why it is being sold. In case a deal looks too good to be true, it probably is. Studying these and educating yourself will minimize risks and maximize the effort you put in.
Get finances in order
Property development isn’t cheap. You need to raise enough money before you start. Having a network is imperative to working in property development if you hope to finance anything. So, look for angel investors, or loans from banks and the likes which can provide you better rates.
It is extremely important that you learn about all the town council laws and regulations beforehand to avoid getting tangled in legalities later. Liaise with the local authorities and get all your permits and documents in order.
There is no fixed formula for property development. It is also a risky business which could leave you bankrupt. So, make sure you are aware of all the risks before you take a plunge. Remember, property development isn’t about sitting and waiting for the market to rise, it is about adding value to a property or developing its value.