If you are wondering how to start a real estate business and how to become a real estate developer, in particular, then, without further ado, here is our guide:
1. How to become a real estate developer: What is real estate development?
Real estate development is one of the best investment strategies in the business. If we are talking about making money in real estate, then this is “the strategy”. However, it is more complex than the other strategies as it requires more education and resources. So, basically, real estate development is about constructing properties for investment purposes. These investment properties could be residential, commercial or even industrial.
There is another option that falls within the definition of real estate development though. That is when a real estate developer purchases an extremely distressed property and applies major changes in order to increase its market value and then resells it.
2. How to become a real estate developer: What do real estate developers do?
Real estate developers are the ones who buy the land, prepare it for construction and then manage the whole process of construction. Therefore, they are the owners and the managers of the whole project. Moreover, a real estate developer is responsible for financing the development project as the owner. However, most developers choose to apply for a real estate development loan. Though it is, indeed, a great real estate financing strategy, you should be careful with budgeting and set financial plans according to that.
3. How to become a real estate developer: How much does a real estate developer make?
When it comes to choosing a career in real estate, the question about the money is the first to pop up. So, how much does a real estate developer make?
Really, you can’t just answer the question with a specific figure. However, we know that real estate developers make more money than the other parties involved. In other words, they get the majority of the profit. This, in fact, is true regardless of a real estate development loan or if they have a partner who financed part of the project. Because, simply, they are the ones who do the majority of the work involved. As we mentioned before, a real estate developer finds the land/ building and makes proper preparations and then proceeds with bringing in the team to put it all together.
4. How to become a real estate developer: Education
When we say you have to get a proper education to become a real estate developer, we meant it! Here, we are talking about a college degree in a relevant field. You could be a business graduate, a management graduate or even a law graduate. As long as you have a BA in a relevant subject, you are good to go.
5. How to become a real estate developer: Enhancing your education
Obtaining a BA in a relevant field is not all. You should also consider enhancing your degree with actual knowledge. You can do that in two ways:
First, you can further your educational path with a Master’s degree in real estate development or a relevant field. This would be a great option as you get to the very details of the business.
Second, you can take real estate courses and obtain certifications. There are plenty of courses that are dedicated to real estate and real estate development, in particular. So, obtaining knowledge would be a better choice in order to get into the real estate development business.
6. How to become a real estate developer: Working for a real estate developer
To become a real estate developer, gaining experience is essential. Therefore, you should consider either working for a real estate developer or becoming a real estate agent first. If you start working with a real estate developer, you get easier access to the business as you watch them work in the field. On the other hand, if you choose to become a real estate agent, you will learn all about real estate investing in no time. You will be able to learn all about marketing, selling, and all of the types of real estate as well as the pricing trends in the market.
7. How to become a real estate developer: Networking is a key
In the real estate development arena, networking is a major key element. In this kind of business, you must have the right connections. Real estate development involves financing, finding the right resources in terms of land deals as well as marketing and finding buyers for your real estate investment. As for funding the project, some real estate developers turn to other real estate investors who are willing to invest their money in the project. Therefore, you will need such connections to keep on expanding your business.
8. How to become a real estate developer: Financial planning is another key
Being good at handling finances is another key to success in this business. You must learn to set budgets as well as setting plans for any expected and unexpected expenses. Also, you must learn to deal with numbers in order to be able to calculate the return on investment. This also includes reducing the investment property expenses as much as possible to maximize the profits.
9. How to become a real estate developer: The traits of the most successful real estate developers
Aside from obtaining a higher education, successful real estate developers have some personality traits in common. First of all, being creative is a big part of becoming a real estate developer. Coming up with the idea and then executing it is not enough. You have to be more creative in the world of real estate development in order to stand out in the middle of the fierce competition in this business.
Second, you must be patient. The real estate development business requires patience as it is a long process. The most successful real estate developers are those who do what they’ve got to do and wait for the outcome patiently while it uncovers.
Third, teamwork skills are a must! Getting into the world of real estate development alone is impossible. A real estate developer must have teamwork skills in order to be able to operate in the business.
Now, that you know how to become a real estate developer, why don’t you check out Mashvisor for real estate education and services?!