The real estate market has seen a steady increase in fluidity since the beginning of the COVID-19 pandemic, as professionals working from home seek out more space, young families seek financial freedom from renting properties, and the economy attempts to fill in gaps left by businesses lost to economic hardship. This process has created an unexpectedly hot market in both commercial and residential markets through the end of 2020 and is expected to grow through 2021. This extended period of low interest rates for buyers and fresh opportunities for investors has created a unique opportunity for new investors to enter the market. If you’re looking to add real estate development to your financial docket, know what you’re getting into. Here are three tips for becoming a real estate developer.
Education is the Key to Wise Real Estate Investments
Get Educated – While most development firms seek a bachelor’s degree in a field relevant to real estate, this field does not require a collegiate education to get a foot in the door. There are many options for certification in financial understanding and the real estate purchasing process, including the Accredited Land Consultant credential, which is voluntary, but helps potential partners know that you are knowledgeable and experienced. If you are looking to join the field without working for another institution, partners are likely to want to see a history of financial knowledge and investment successes. Previous work as a real estate agent can also appeal to wary buyers or sellers.
Network Your Way to Success
Build a Network – Real estate development is similar to many other industries in that knowing people helps. Networking can feel like a big task, but getting your foot in the door is easy during your introduction to the market. Many investors and developers compete for the same projects, making getting introduced fairly straightforward. Attend auctions and other purchasing events, even if you’re not looking to buy said properties. Having connections at the municipal level can also aid in your ability to be prioritized for purchases and awarding of permits, so play nice with the local government when you’re looking for investment opportunities, especially in areas where you plan to develop regularly.
Know the Partners Critical to Real Estate Development
Know Your Area of Investment – This is a literal tip. Breaking into new markets is a challenge for businesses and firms of all types, but especially those in the real estate market. Keep your initial development area tight; in part to assure that you have the appropriate relationship with relevant parties, but also so that you develop a deep knowledge of the area. Political affiliations, attitude towards new developments, geographic traits, and area climate are all key factors in determining what sorts of development opportunities may await you in a given area. Without knowledge about such things, it can be difficult to carve out a successful project. While not every soon-to-be real estate developer lives in an especially hot market, chances are good that municipalities somewhere near you have opportunities which suit your existing knowledge – take them before thinking about expanding your circle of consideration.
Once all your qualifying ducks are in a row, it remains vital to have access to reliable financing. Capital is key to successful real estate development; consider us a resource. EMCAP lending provides opportunities for developers new and old with a passion for your success. When you’re ready to begin your journey into the world of real estate development, contact us.