1. Always double-check the figures.
Getting your calculations right is essential if you want to be successful in the risky business of property development. It is possible to make a small fortune in the business, but you can also lose everything and end up with huge debts if you don’t get your sums right. You need to know how much similar properties are selling for in the area, the cost of stamp duty, how much the refurbishment will cost from bricks to glass conservatory roof and what sort of additional fees you may be liable for. Once you have done some initial calculations, you need to figure out the profile of the buyers you will be reselling to, how much the renovated property will realistically sell for and determine if the projected profit margin is worth your time and investment. Property development projects are very capital intensive. If the game were easy, everyone would get into it and become millionaires.
2. Keep a close eye on the residential real estate market.
In order to situate yourself in the best position, you need to track what’s happening in the housing market. There are basically four key factors that influence the housing market:
• Employment Figures
• Interest Rates
• Demand & Supply