Real estate investment and development has never been a more popular hobby or career change challenge; If you want to learn seven secrets to investing in real estate consistently and successfully through development or if you want to know how you can continue to profit from the property, even if the market takes a downward turn, read on…

1) Do your location homework – Did you know that through sustained and successful location research, professional real estate investors continue to make profits during a market downturn? It’s true: Regardless of market conditions, you can apply your location research approach to your real estate investments and earn consistent profits from the property, too.

Take the time to learn all about a town or city you’re considering for your next real estate development purchase and find out where the emerging areas of that town are likely to be. If there are downtown redevelopment projects planned, examine the real estate market in the immediate vicinity, if there are areas that are booming right now, examine the immediate neighboring areas for their potential for future price increases, for example .

Don’t Follow the Crowd: Have the confidence to buck the trend and get ahead of the curve by positioning yourself in a market that is poised to boom rather than one that has already flourished.

2) Know what you can afford – While it can be profitable to speculate at times, never be tempted to jeopardize your own home. Calculate your finances and be ruthlessly strict about what you can and can’t afford for down payment, mortgage costs, and renovation and remodeling costs for your next real estate investment. Only proceed within the confines of your strictly allocated budget and don’t be tempted to overextend yourself, especially if competition in the real estate market is stiff and the market is slow or stagnant.

3) Identify your target market – Having identified your next location for real estate investment, identify the types of people buying renovated properties in that location. Know who your target market will be and what they are likely to be looking for in a property in that location. If, for example, you are examining inner-city spaces, you may identify that your buyers will be single young professionals and that the ideal property type for these individuals will be low-maintenance luxury apartments – look for suitable properties with the potential for refurbishment. in luxury low maintenance apartments and you will meet the instructions of your target market… look for large houses with sizeable gardens in the area and you will have completely missed the market and possibly created a property that will not sell!

4) Renovation, not reconstruction – Know your budget limits and personal skill constraints. Don’t consider purchasing a property in need of a complete structural overhaul when your budget is tight or you don’t have the time, skills or inclination to do the structural work yourself. Be realistic about what you and your budget can achieve and look for properties that meet that summary. Pay to have an independent and comprehensive survey conducted on any property you’re seriously considering buying before you make a down payment to ensure there aren’t any hidden surprises waiting under the floorboards to consume your budget in full.

5) Manage your budget – With your survey in hand, you can approach builders for quotes and look up prices for fixtures, fittings, finishes, and furniture. Take the prices quoted and obtained and build your budget. Factor in ongoing mortgage and service and labor costs, as well as your findings and structure, and allocate your money accordingly. Keep an eye on every expense and be ruthlessly strict with yourself and your builder. If possible, get your builder to commit to a contract with fixed completion dates and rates and stay on top of every dime or penny every day. At the end of each week, tally up your spending and expenses and make sure you don’t go over your budget. If you’re spending too much, shrink it or you’ll have to remove it from other areas of development. Remember to never skimp and save on the finishing touches and always have a realistic backup fund in case of emergencies.

6) Appeal to the broader market – Forget putting your personal stamp on any property you develop – YOU will not live in the property! You should have already identified your target market, which will give you a good idea of ​​the level and quality of finish expected, now meet those expectations without adding your own personal taste to the equation. By appealing to the broader market or lowest common denominator, your property will appeal to the majority of buyers, making it quicker and easier to sell it and make a profit.

7) Make friends with a real estate agent – Your greatest ally when developing a property will be your real estate agent. Make friends with these guys and you will build a beautiful and successful symbiotic relationship in which both of you will benefit the most! Real estate agents are an untapped source of knowledge about the local market, who is looking for what property in what area, what extra features cost little to add but raise the selling price, and what a buyer expects of their type of property in particular. Get the facts from your real estate agent, and then apply their advice. You will create a property that they can market for the best price and in the widest market: you will make more profit and they will get a higher commission, which guarantees a beautiful and lasting friendship.

Finally, remember that when you’ve bought, renovated and sold, you’ll be looking for the next property opportunity and any real estate agent you’ve worked with well will be on the hunt for the right real estate for your next investment. any subsequent purchase is much easier to obtain.