A Developing Career: Succeed as a Property Developer

Buying older properties, renovating them, and selling them for a profit is a stylish occupation. This practice of “flipping” real estate is featured in popular television shows and discussed by the likes of financial expert Dave Ramsey. What does flipping a house have to do with real estate development? It can be the first step to a lucrative, exciting career. The important words here are “can be,” because you must approach property development intelligently and thoughtfully. Here are suggestions to help you succeed as a property developer.

Study the Market

Pay close attention to the housing market where you want to operate. It is mercurial, and it is dependent primarily upon four economic factors and one sociological element.

• Supply and demand
• Employment rate
• Inflation
• Interest rates
• A “feel good” element or factor

You need a solid knowledge of the overall economy and sociological perceptions to succeed.

Choose the Right Location

The best location for your venture may not be the most popular at the moment. Buying a hot property downtown may seem safe since everyone else is doing it, but it could use up your capital and make selling for a profit difficult. Once you have done your homework and have a solid understanding of your area, do not be afraid to imagine what could be. The old adage “Nothing ventured, nothing gained” is true with successful property development.

For example, Fiddler’s Creek Aubrey Ferrao in Naples, Florida, went against the current trend. Most of the region’s developers were snatching up land and properties in Bonita Springs and northern areas of Naples. Aubrey Ferrao and The Gulf Bay Group of Companies chose land on Marco Island and in south Naples for the Fiddler’s Creek community. This master-planned development now boasts a golf course, restaurants, a beachfront hotel with 100 suites, a marina, and a Club and Spa. The right decisions, based on knowledge and also on instinct, can propel you to success in this field.

Look for Opportunities

Get out and about. Look for amenities such as schools, parks and green spaces, and public transportation. Focus on properties that are on the edges of desirable areas that, given time, can become part of those good areas. You never know what you will find until you seek opportunities out.

In some cases, perhaps elderly homeowners are considering selling older, run-down houses they can no longer maintain but that are in potentially desirable locations. Offering them a good price—one that still leaves you room to make a profit when you sell—may help them finally decide.

Think of Profit When Buying

Pay the lowest price you can when buying. The purchase is when your profit is generally made, not the sale. When starting out, your finances may limit your choices, unless you own the property you want to develop and sell. If you must buy, try to pay as little as possible. Every bit you can get dropped from the purchase price is profit for you.

Buy Land Rather Than Property

Vacant land may be a better long-term investment than developed real estate, especially if you are just beginning. If you are interested in renting out properties, look for suburban neighborhoods with affordable plots. Your profit may be even higher if you buy multiple plots in one area. Once you own the land, you can quickly build duplexes or houses to offset any debt and begin generating income. Having the vision to buy land in up-and-coming areas can lead to a successful venture, just as it did for Aubrey Ferrao and Gulf Bay Group with Fiddler’s Creek.

Establishing yourself as a property developer takes research, business skills, and perhaps a bit of courage. However, there are specific steps you can take to court success. In the end, your vision plus hard work can yield a profitable venture and a rewarding experience.