Becoming a property developer is often seen as a quick way to make a fast buck, but it’s a lot more complicated than simply ‘buy a property, rent it out, rake it in’. While it is true that technically, anyone can be a developer as you don’t need any qualifications to do so, that doesn’t mean that anyone should be a developer.
You need to be in a very stable financial position before considering taking on the financial burden of a new property – there are a number of substantial ongoing costs to consider, so it’s strongly advised that you enlist the help of a chartered accountant to help you assess how affordable the endeavor will be for you before you begin putting money into it.
If you’re looking for accountants in Watford, look no further than DUA. – we’ve many years of experience in property accounting, and we can guide you through every aspect of the planning, legal and fiscal responsibilities involved in property development. But before you start planning your career as a developer, there are some things you should consider – read on!
WHAT IS PROPERTY DEVELOPMENT?
Simply put, a property developer is someone who buys a property, renovates it and either sells it for a profit or leases it to tenants. Experienced property developers buy land or existing old properties and use it to build new developments. If you’re good at DIY, have an eye for interior design or have a lot of cash which you’re looking to invest safely, property developing could be great for you – but it isn’t easy. You need to get it right to make money – and it might take years for your investment to really pay off. So how can you ensure your money will work for you?
THINGS YOU SHOULD KNOW
As we’ve already mentioned, if you don’t have the money to see you through, you absolutely should not consider property developing – and you shouldn’t borrow more than you can afford either, no matter how much you think you’ll eventually make. You’ll need cash set aside for hiring contractors, having a structural survey done, agency fees and ongoing maintenance and repairs – as well as sorting out any issues that come up during the structural survey. You will need the help of planning consultants and good architects, but it is also essential to hire a chartered accountant who is experienced in the property market to help you manage your finances throughout the endeavor. DUA are accountants in Watford, but we also have offices in London where we can meet if it suits our clients.
Another reason why it’s important to manage your money wisely is because doing things on the cheap simply doesn’t work – if you want to increase the value of a property, rather than just redecorate it, you’re going to need to invest in quality appliances, materials and achieve a high level of workmanship – or you may not see the profit you were hoping for.
Contrary to popular opinion, becoming a property developer isn’t a fast track to wealth. It takes a lot of resources, planning and experience to make it work for you – but, at DUA we can give you the benefits of our expertise to give you the very best chance of succeeding in this venture. In a recent property event where I was chairing the forum a member of the audience asked the panel – So what is your advice to someone new to this? My clear message was to surround yourself with experience and knowledge, the experts with experience in property and accountants to advise you from project feasibility to completion focusing on structuring, projects costs and budgets, and making profit!