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When it’s good, working in property can be one of the most lucrative sectors out there. As the economy continues to pick back up, things are looking positive for contractors, renovators, and property investors of all kinds. If you have experience in any of those sectors, the next step up is property development. Taking projects on from start to finish for both public and private sector clients can be immensely profitable. But you need to ask yourself if it’s the right place for you, first.
Is running a business for you?
Property investors might have worked with contractors and oversaw enough projects in their time that they want to make a career out of doing it for clients, too. But there’s a big difference between running a business and overseeing your own projects. Having a business plan is always a good idea. Setting specific and targeted goals, managing workloads, considering staff requirements and the HR and payroll needs that come with them are all part-and-parcel of running a business.
Can you spot opportunity?
In property investment, opportunity is mostly about spotting great properties to buy, renovate, and sell. You look for neighborhoods that are on the rise, homes you can improve the value of, and so on. There are skills just as important in property development, but being able to build ties with clients will guarantee you much more work, too. Learn to network both with state and private entities.
Are you patient enough for the waiting game?
When working on developing new builds, especially for public clients, development can take a lot longer than you might like. Factors like planning and development, corporate property management, compulsory purchase and the like can all delay and lengthen the span of a project. Having planning consultants on your side can be a huge factor in your success. But you have to be able to play the long-game with clients that could prove the most profitable.
Can you spot the danger?
You also have to be able to tell when a certain property or client might not be as profitable as you might hope. That’s just one of the property development risks well worth considering. Others include doing work without locked in contracts and agreements guaranteeing completion and payment and the waste and friction that can cause a project to progress slower and become less profitable.
Do you know the right people?
One of the biggest risks of all is having builders that you don’t trust. The success or failure of a project can depend entirely on them, but you are ultimately responsible at the end of the day. Have a diverse range of contractors that you can vouch for, with easily validated experience that they openly share.
Property investment isn’t for everyone. You have to be able to run a business, to navigate much more legal complication, and to be able to weigh risk and opportunity in every decision you make. If it is for you, however, then it can be the most promising path available in the property market.