For years, you’ve trudged into the office every day and dreamed of leaving it all behind to launch your own business – you just couldn’t quite figure out what sort of startup you’d be qualified enough to actually run.
Then one night, as you settled in for an evening catching up with your favorite interior decorating shows (Grand Designs, Homes Under the Hammer, Amazing Spaces, you watch them all), it suddenly hit you.
You’re meant to be a property developer.
You’ve seen it done on TV a thousand times before, and it really doesn’t look all that difficult. All you need to do is buy a rundown flat in an up-and-coming London borough, do it up and sell it on for millions of pounds…
…that’s how it works, right?
Sadly, the life of a property developer isn’t just the endless tea breaks you see on telly.
With that in mind, before you go running off to hand in your notice and dive head first into your new dream of owning a property development business, we’re sharing three truths about the industry you need to understand.
#1: just when you think things can’t get any worse, they will
Roofing disasters, water damage accidents, unexpected costs for materials – you’ll experience lots of hiccups along the way, and it will always feel like they come right at the worst time.
They’re unavoidable, but you can limit their impact by properly checking over a property before signing up to a mortgage.
The older the building, the more likely you are to discover issues. Luckily there are chartered surveyors to identify risks and plenty of experts in things like asbestos removal to help you recover from them.
#2: your social life will not survive unscathed
Think your current nine-hour days are tough? Be prepared for a whole lot worse when you start your property development business.
The average house renovation takes between four and eight months to complete, and that all depends on the amount of help you can afford.
Since you’ll probably be attempting to take a lot of the work on yourself, you could be looking at a much bigger timescale. You’ll need to be patient and accept that there are going to be several long days and weekends ahead of you.
#3: budgeting is hard
Before you even get to the fun part of decorating and spending all your money in IKEA, you’ll discover that sticking to a budget is difficult.
Part of that is thanks to all those little emergencies that’ll pop up, but your first financial hurdle will be actually buying a house. Try to get a mortgage under any circumstance nowadays and you’ll find it hard – as a property developer, there are even more hoops to jump through.
Buy-to-let or sell will be the biggest question the bank will ask you, so do your research and explore all your funding options thoroughly.
Still not put off your property development dream? Then you might just have what it takes –remember to keep our words of warning in mind as you get started.