Being a beginner in the property development game is hard. It’s a highly profitable industry because it’s a timeless industry. People always need houses and they’re always moving onto the next one before too long. Of course, even though there’s potential for anybody with the right mindset to slip into this market, that doesn’t mean you won’t make some mistakes along the way to becoming a successful property developer. You can, however, give the illusion of success until you achieve success. Here are some tips on faking it until you make it in the competitive real estate game.
Much like any business venture, the most important element of all is having an entrepreneurial and determined mindset. You have to be hungry for the goal of transforming a property and turning it over for a profit. Of course, like any other business, you also need to have somebody on board who understands the technicalities of the industry even if you still don’t get it. You might consider hiring a property manager to help you turn this from a solo operation to a team operation. Think of your property manager as your mentor for this industry.
One day you might be able to manage your properties by yourself but a professional manager will be able to tell you how much rent to charge to remain competitive within the area and yet still make a sizeable return on investment. They’ll also be able to help you with the administration side of things (if your property development business grows then you’ll be able to hire more people to help with this manner of thing). Again, it’s important that you pay attention to everything the people you hire are doing because you need to learn how it all works.
Do your research.
Continuing from the previous point, you need to do your research if you want to be a successful property developer in the world of real estate. It isn’t really a skill you can master until you’ve stepped out into the world and gained some experience. You need to observe the way property prices fluctuate in certain areas and the way in which extenuating factors influence the price of a property. You could check out buy to let properties in your local area if you wanted to get a rough ballpark figure for the kind of investment you’d need to make. Again, it’s important to know the neighborhood alongside the property in itself. If you find some properties that intrigue you then do some investing into the local amenities, schools, and the general community vibe that the town, village, or city has to offer. Figuring out the correlation between price and environment will start to become second-nature to you before long and that’s when you’ll know you’ve become a natural property developer.
Decide whether you’re buying to let or sell.
This stage is crucial too. Perhaps you already decided this long ago, or perhaps you’re planning to decide this based on the sort of property investment opportunities you see or the advice of your manager, but the decision to let or sell is a big one. Buy-to-let is a long-term game, whereas buy-to-sell can make you a sizeable income in the short term. It depends on which kind of property developer you’d like to be. Though many property developers opt for the buy-to-let strategy to give themselves a steady and never-ending stream of income, you’ll need to consider downsides such as the rental yield being included in your income tax for the year. Still, if you’re in this game for the long haul then that’s only a small hit to take in order to grow your business on a larger scale.
Learn the art of patience.
A final piece of advice but perhaps the most important piece of advice: learn to be patient. It’s all about timing in the world of real estate. You’re going to have a never-ending stream of real estate agents in your ear telling you that you must rush to buy a certain property before another interested party comes along. Remember, they’re only interested in the commission, and they’re not thinking about the long-game like you are.
This is your business venture, and you need to time to do your research, as mentioned earlier. Of course, once you have found the right property in the right location then you shouldn’t sit on the decision. You may not have it all figured out as a property developer just yet but it doesn’t hurt to get stuck in once you’ve got a good gut feeling about a place. You can only get to know so much about the market and the area.