| Is your Property Development project on track? | | | | 13. Good project management skills |
| Is it making enough money to fund more | | | | This is so important. Project management skills |
| projects and grow your equity? Property | | | | are important for those with negotiating approval |
| Development is an extremely rewarding business | | | | processes, with construction activities and/or with |
| and if you are to make the most of it you will | | | | building maintenance programs. |
| need to learn as much as you can. | | | | 14. Effective cost controls |
| Here are 18 ways you can improve profitability of | | | | Property investors and land developers should |
| your project. | | | | have effective cost controls to maximise |
| 1. Negotiate agent commissions. | | | | profitability. Efficiency is paramount. |
| Everything is negotiable. The only caveat is, if | | | | 15. Output is sold under contract - incorporate |
| they don't get enough they may not do a good | | | | long-term sales contracts |
| job. So win-win thinking here is best. | | | | Property investors can reduce risks by negotiating |
| 2. Watch and record all expenses like a hawk. | | | | long term leases with strong tenants. Land |
| Efficiency is the way of future. | | | | developers can reduce risk by pre-selling lots. |
| 3. Negotiate long term contracts with builders. | | | | 16. Maintenance of excellent customer relations |
| Or if you are like me and a builder-developer have | | | | Property investors should ensure a reasonable |
| a panel of contractors. | | | | relationship between the landlord and tenant. I also |
| 4.Buy appliances at auctions and store them until | | | | focus on superior marketing. In business there are |
| required. | | | | two major focuses. Marketing and Innovation. |
| Currently I don't have a space for inventory, so | | | | Think Apple. |
| this is on the agenda. | | | | 17. Carrying out all necessary maintenance to |
| 5.Market research. | | | | keep facilities in good condition |
| Know you market and give them what they | | | | Property investors should monitor the state of |
| want. For example a double garage in some | | | | the property and ensure maintenance. If you are |
| suburbs is a must. If you don't provide it, you will | | | | managing a property then maintenance |
| be penalised by the market. | | | | programes are very important, it is tempting to |
| 6.Go green. | | | | do only the essentials, but at some stage the |
| Research indicate buyers will pay a premium for | | | | work must be done or the capital values will be |
| sustainable houses (this will be the next major | | | | affected. |
| wave of innovation in residential building practices). | | | | 18. Market research and understanding |
| 7.Negotiate Lending rates. | | | | Skill and knowledge to: understand the property |
| Shop around. Half a percent on a million or two of | | | | market cycle; localised market conditions; landlord |
| lending adds up! | | | | tenant and/or land & building legislations and |
| 8.Rent houses while in planning stages. | | | | processes; tax implications; financial markets; and |
| Goes without saying, but you would be surprised | | | | negotiate borrowing facilities. Be a student of the |
| how things can get out of hand. | | | | market and Property Development in general. |
| 9.Maximise sales prices. | | | | Finally think like an entrepreneur. Focus on |
| Don't accept the first offer. Push back on the | | | | innovation, doing things better, adapting ideas. |
| agents to go back and negotiate a better deal. | | | | They want to be rewarded for their success. You |
| 10.Sell completed. | | | | will need to be all of these things. Property |
| If cash flow allows. Of course it may be prudent | | | | Development is a very entrepreneurial activity. |
| to sell off plan to minimise risk and exposure. | | | | You need to visionary and see the end before |
| However, the public really has a hard time | | | | anything has started. To be able to see the |
| visualising the end product, so selling completed will | | | | potential. |
| yield a higher price. | | | | As a real estate developer you are a "specialist |
| 11. Understanding government policies and their | | | | generalist". There are so many specialists which |
| implications | | | | need to touch your project, so focus on keeping |
| A good understanding of the government and | | | | the good ones, building your contacts and |
| council approval regulations and processes. These | | | | relationships. It will pay off in superior quality. |
| can be onerous! Understanding of tax legislation | | | | Of course all of this is learn-able and scalable. You |
| and financial markets and an ability to negotiate | | | | can start on small projects and work your way |
| favourable borrowing facilities. | | | | up. The sky is the limit. |
| 12. Build Houses currently favoured by the market | | | | I started with small renovation projects that |
| Identifying rental properties and/or land located in | | | | involved repainting and building a picket fence. And |
| prime locations. Property investors and land | | | | worked my way up where I now manage 7 |
| developers should target property hat is | | | | figure projects. |
| attractive to targeted markets. I am planning an | | | | Boldness has genius, power and magic in it. Begin |
| article to detail what the current market wants | | | | now. |
| for a given type of dwelling. | | | | |
