It is a well accepted fact that refurbishing and renovating a property is going to be of benefit. At a minimum, it will help to improve the dwelling’s use and aesthetic appeal – and ideally it will also generate a decent little profit, too!
Property development, however, takes the concept of leveraging a property for profit one step further.
On one hand, the potential for rewards can be far greater when embarking on a property development, than they would be when investing in a passive real estate investment.
But just as the potential rewards increase, so do the potential pitfalls – and when you begin the property development process without a thorough understanding of the road ahead, you can end up with less wealth than when you began!
What is Property Developing?
The most commonly accepted definition of property development includes the reclamation, renovation and refining of a building structure in such a way that it can be considered as a material change in the state of the property.
This broad definition covers a number of activities related to an active property investing strategy, which may include:
- Buying, substantially renovating and selling a property for immediate capital growth and profit.
- Buying, substantially renovating and holding a property, renting it out for immediate cash flow gains.
- Initiating extensive renovations and structural improvements on an existing property, to increase its usage, size and amenity.
- Developing a block of land, or subdividing a larger block of land, by constructing a new house or several townhouses on the land.
- Creating a building comprised of multiple, separate apartments in a medium- or high-density complex.
All of the above fall under the category of property development, but simply embarking on a renovation project doesn’t make you a professional – nor does it guarantee you success.
So just what can you do to work out how to turn yourself a property developer, without wasting a lot of time, money and effort along the way?
Pre requisites of a Successful Property Developer
Far from being for the feint-hearted, property developing is a complicated, demanding and at times stressful undertaking and to that end, it doesn’t suit all investors.
It is a very proactive investment strategy and it can create incredible financial rewards – that is, after all, what makes property investing worth tackling in the first place!
However, we at Real Wealth Australia wouldn’t recommend that those who are brand new to investing in real estate embark on the property development process until you’ve built up some experience.
We have been approached by numerous people in the past who ask the question: “Can you show new investors how to turn yourself a property developer and make money from real estate, fast?”
While the answer is technically yes, it has been our experience that making a “quick buck” from property is rarely the best way to create long-term wealth.
We have a culture of helping our clients create the best possible solutions for their situation, both now and in the long term. For this reason, we would generally advise against a substantial renovation project or property development to those who are new to real estate.
You’re almost always better off getting one or two small, safe investments under your belt first. This allows you to create and grow your skills in research and due diligence, negotiating, crunching the numbers and following your strategy to its conclusion.
We are always available to support and guide our students towards the most profitable outcome, so in every instance we aim to work together to bring your ideas to reality.
Why work with Real Wealth Australia?
Over more than a decade, we have built a reputation for delivering professional service, expertise and guidance to help everyday investors work towards their goal of creating financial freedom.
We see property not just as a pile of bricks and mortar – but also as a means of leveraging money and creating wealth, that allows ordinary people to achieve financial goals they’d only ever dreamed of.
Once such way to achieve financial success is by leveraging the property development process, but this is just one of many strategies you can use to get ahead financially with real estate.
The best course of action for you personally will depend on your own situation, which is influenced by multiple factors, – including your job, income, risk appetite, debt situation and more!
For this reason, when we begin working with new clients at Real Wealth Australia, our goal isn’t simply to help you understand and simplify the process with property development tips. Rather, it’s our aim to help you educate yourself about a range of different opportunities available to you, so you can make the best and most profitable financial decisions, now and in the future.
Feel free to connect with us and learn how to turn yourself into a property developer, or how to achieve wealth a number of other ways using real estate as your vehicle for growth.