Own a property that’s been rezoned for development? You may have won the property lottery. Thinking of developing it yourself? We can help you.
With any rezoning, as a land owner you’ll find yourself inundated with letters, door knocks and phone calls from every local real estate agent, through to developers looking to do a deal. In fact, you’ll get pretty sick of them pretty quickly. But I’m sure this will give you a few ideas. There’s money to be made in property development, so why not do it yourself?
One of our biggest tips would be to quickly ignore the real estate agents. Property Development is an extremely complex and commercial transaction, and something a standard real estate agent is not qualified or experience in handling.
They can sell your home with emotions, but the intricate numbers and assessments required for proper development sales are a different beast. Don’t fall into the trap many fall into. Fake offers, faux development shell companies, and option agreements which look good on paper, but return you next to nothing.
Let’s look however at the process of doing it yourself. Dave Mills boasts more than 10 years of property development experience, managing several hundred million dollars worth of property developments across New South Wales. He’s given us this guide to help those looking to develop themselves.
Developing your land yourself
First advice I always give land owners who approach us about developing themselves is to consider the entire situation and take a step back. This includes not just the intricacies of developing, but also your personal situation, and your family. Developments are rarely straightforward processes, and take time. Consider your situation carefully, and get expert advice from your lawyer, accountant, doctor and from the project side, your development consultant.
You’ll get advice offered to you by friends, cousins, neighbours, everyone. Your situation, and your site are unique to you. Follow the experts, with respect to those personally close, they are in most circumstances not experts in the respective fields.
Consultants
There are a multitude of expert consultants relevant to your development site, but the best places to start are your Accountant, and your Lawyer. They will look at a number of things, how to set up the vehicle and taxation/financial liabilities, and your lawyer will look at structure to minimise the risk profile. These two are important places to start, as it may give you the important first step to consider in the development journey.
The next type of consultants are littered throughout the process. You may need 10-20 different groups to help liaise your project. This can be time consuming, and you may not even know where to start, and that’s okay. You need the right industry experts to deliver a project that meets the market, and is effective to develop. Designing even the smallest component wrong can affect your sales, and similarly your financial outcome.
This is where Altitude Property can assist. With so many different consultants, and so many variables, our core service is to bring together the best for your project, and also provide a central point of contact. We handle the technical part and work with the consultants, you deal with us.
Personal Items
A number of personal considerations need to be taken into account. As odd as it sounds, you need to be wary of your age, and health. Projects can take some time to realise, and can be somewhat stressful. Make sure you feel healthy enough to undergo this journey.
Evaluation the financials – how much equity do you have in the property? Is it debt free or still under a mortgage? Do you have any personal debt that may be an inhibitor to attaining finance?
Preparation Work
The preparation work can be handled by us, Altitude Property. Early steps include getting a valuation, and assessing the potential returns of completing the developing vs actually selling it. Speak to your accountant. Also, a basic feasibility to assess the returns, the values of sale, cost of development, taxation, contributions and more to complete the development. Take this to your accountant and weigh up the pros and cons.
Assess the constraints relevant to your property. What is the zonings, access requirements, servicing, historical contamination or dwelling locations, heritage, council, flood, fire, DCP and more. Again, something Altitude Property are experts in.
Living Situation
Another thing to consider is where you are going to live. Don’t forget, before you realise the returns, you’ll have to move out as they develop the site. Will you rent, or do you have another dwelling. This must be considered as you will be out of the property on the site as works commence.
Selling Agent
There are so many agents. When it comes to houses, there are many brilliant agents who can do the job. When it comes to development sales, it’s a whole different concept. Ultimately, you get what you pay for. While a development agent costs are not dissimilar to a standard agent, it’s important you get one that specialises only in property developments. For a standard real estate agent, selling 4 normal homes on a weekend will be big money for them. However selling 4 blocks of land, is less, and further away. If your agent is also selling homes, you are not their priority.
Altitude Property is a proven development agency. We understand the constraints and requirements, and timeframes required on a project site. Sites are very technical, and agents who do not understand the individual intricacies of projects will make sales promises you cannot deliver. You want your agent to represent you with integrity and trustworthiness. The liability falls back to you. If your buyer expects a Rolls Royce and gets a Toyota, they won’t be happy.
Marketing
We’ve worked on many projects, and the number one thing that gets missed is good marketing. We have creative agencies on hand that create great marketing and great content for our projects. One of the main core issues is money is not put aside or factored in for a marketing campaign. Throwing a Premiere advertisement on RealEstate.com.au does not get you ahead. Your project will be lost. Marketing can be done effectively, and with great collateral, imagery, brochures, videos, and websites that makes your project look the best in the market. Again, Altitude can handle that for you.
You’ll have noticed one common theme in this guide, and that’s Altitude Property. We are proven, development experts. All we do, is projects. Your project is our focus, and we handle everything from A-Z. Developing your own site is not easy, and takes a long time and many steps, but incredibly rewarding once you complete it. We take the guesswork out, having managed the delivery of tens of thousands of lots across New South Wales. Our team is seasoned, our experts the best of the bunch.
If you’d like to find out more, send us a message using the contact form on our website.