What does it take to become a developer? The right mix of training, market knowledge, and on-the-job experience.
Key Takeaways: 7 steps to become a real estate developer
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Learn real estate fundamentals
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Get a license
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Prioritize networking
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Create a realistic timeline
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Decide on your market
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Develop key skills
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Create the right financial plan
Thinking about becoming a real estate developer? It could be a great move. These professionals make an average salary of $77,310 per year and up to $179,000, according to Indeed. Developers require unique expertise that is a bit different from an investor or an agent. They have to really know the current state and trends in the real estate industry and be experts at predicting financial outcomes and timelines. Developers also have to manage many moving parts for each big project.
Real estate developers need the right balance of business skills and market knowledge. How do you build these skills and launch your career? Follow these seven helpful tips to get started.
1. Learn the real estate fundamentals
Some education and training will be required to build your career as a real estate developer. You don’t always need an advanced degree, but you need to know the ins and outs of how transactions work. You also need to know the typical construction and contractor processes and city development priorities.
Some developers do get a degree in finance, management, engineering, construction management, or even real estate if the degree is offered at their desired school. There are also real estate MBA programs and online degree programs to pursue if you want to go into this field.
In addition to learning how the process works, you’ll need to fully grasp the market: What causes ebbs and flows, where do things stand now, and where is the industry is headed in the near future? This requires digging into real estate blogs, paying attention to news about the market, and listening to conversations from the experts.
2. Get a license
Obtaining a real estate license isn’t a requirement to be a developer, but it can be a good idea. A licensing program teaches you even more about the field and can help you gain valuable experience. For example, you may want to work as an agent before taking on development work, which requires that you get a license.
Depending on your program, you can typically get a real estate license in under six months. Specific requirements will depend on your state, so be sure to check what steps you need to complete.
3. Prioritize networking
Most jobs require a little networking to keep moving forward, but it is a must for real estate. There are so many moving parts involved in buying, selling, building, and renovating properties that it helps to have strong connections from financial institutions to contractors to marketers to clients.
Four great ways to start networking now:
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Join real-estate-focused groups on social media, particularly Facebook and LinkedIn.
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Attend conferences, events, and talks where experts discuss trends.
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Reach out to people you know who have real estate experience and ask to pick their brains.
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Join local associations and groups that provide networking resources for their members.
Real estate is everywhere, so it’s not hard to get involved now. Make sure you put in the effort to meet new people and build long-lasting relationships.
4. Create a realistic timeline
Once you’ve built on these first few steps, it’s time to set some goals. You can start planning your timeline once you know the requirements you still need to complete and how long they’ll take. Don’t be afraid to start with small goals. Successful real estate developers have to build experience and resources over the years, it won’t happen overnight.
By taking things slow, you’ll be able to absorb more information and make better decisions later on. Remember that a degree or license can’t replace on-the-job experience.
5. Decide on your market
So, you not only have to understand the real estate industry as a whole and your local market; you also need to nail down exactly what and who your target market will be. This involves identifying the areas you want to work in, which will be governed by your interests, prices, demand, and other considerations. You may also want to narrow things down by commercial versus residential properties and who your ideal clients are.
All of these considerations require you to do plenty of research and pay attention to the strategies successful developers are using. Learn everything you can about each unique market and community.
6. Develop key skills
There are lots of soft skills in real estate development that degree programs don’t always teach. Some of the most important for real estate developers are communication, people management, patience, professionalism, and negotiation.
Many of these, again, come with years of experience, but you can master them by being deliberate. Think of ways you can improve your communication skills, whether it’s practicing speaking in front of others or joining a new group and discussing topics with strangers. Practice being a good listener and not just waiting for your turn to talk. Try to stay open-minded in negotiations but don’t be afraid to ask for what you want and stand by your convictions.
7. Create the right financial plan
Finally, one of your last steps before diving in will be to figure out your finances. You’ll usually need to get financing for projects as it’s not likely you’ll be able to fund them on your own, especially when you’re just starting out. You also need to put processes in place to track and manage cash flow, record expenses, prioritize tax planning, handle invoicing, and generate reports. Running a profitable business doesn’t just happen. It takes lots of planning, organization, and consistent management tactics.
The team at Franco Blueprint can help. We help owners set up their businesses and make their financial practices better. We deliver solutions to automate accounting processes and get paid in the most efficient ways, which can be challenging as a real estate developer.
Contact Franco Blueprint today for a free consultation.