A real estate developer is someone who purchases land and creates plans for structures on that land. These professionals build commercial properties or residential or housing developments. Some developers also renovate or expand existing structures. Although these investments have enormous profit potential, if they do not complete the process properly, they can also produce significant losses. Therefore, these are a few development tips.
Build a Strong Team
Like most things in life, your potential is greater when you have a solid team. If you haven’t completed any development projects yet, find a mentor who can guide and teach you. These individuals are invaluable because they can walk you through their existing projects and your first few projects. They also provide guidance throughout your real estate development career.
Your team should also have at least one reputable realtor and mortgage broker, as well as an architect and engineer. At some point, you should add a CPA and real estate attorney. Find at least one construction company that provides high-quality work for a reasonable fee when you need it.
Conduct Extensive Research
You also need to gain knowledge about becoming a real estate developer. You need to understand your market and industry, learn to negotiate well, evaluate local needs, and learn about legal challenges you could face. You should have the ability to use a community’s economic, socioeconomic, financial, and demographic characteristics to create a plan that benefits you and the community.
You should also research purchasing contracts and contingencies. For example, you may base your purchase on your ability to rezone the land and permit your build.
It can take a while to find the right property at the right price. You could look at hundreds of properties before you find one that has the zoning, topography, and potential you need. Don’t jump on the first property you see. Have patience and find the one you really want.
After you set your development goals, take time to prepare yourself so you can succeed in your new real estate development venture.