For many people interested in property investing, getting involved in a development project is the crème de la crème – it’s the ultimate dream. And, certainly, it’s a complicated strategy with a lot of risk, but then the profits often justify the means.
Embarking on a large scale property development is something you’ll do many years into your property career. In other words, it’s something you do with plenty of experience and sector knowledge – not to mention contacts – behind you.
As well as understanding how the industry works and who you need as part of your team going forward, you will also, of course, need the finance. And this is where a lot of property investors come unstuck – either the loan interest is too high, they get turned down for loans or they can’t find the joint venture partners they need to get going.
If you’d like to get into developments sooner, getting help form a mentor or franchise, such as Sourced Network, could be the answer.
Getting finance for developments
Getting finance in the first place is probably the biggest challenge for an aspiring property developer. But it’s not such a big worry when you’re a Sourced franchisee. We can provide access to finance for all property projects – not just buy to let, HMO or refurbs.
Not only that, but we will also help you customise your funding proposal based on your specific needs going forward. And we’ll make sure you don’t have to wait around for it either, so that you don’t potentially miss out on your development deal.
And the best bit? Unlike traditional finance options, Sourced loans are based on the GDV of your project. As a result, our franchisees are often able to borrow up to 100% of the purchase and other costs.
Check out our Quick Guide to Property Finance.
Acquiring the funding is just one challenge when going ahead with a development, others are:
Challenges of a development strategy
▪ Sourcing a location size – it can take months and even years to find the right location. And even then, you may get beaten to it. This is something that’s worth spending time on though, since location is crucial.
▪ Getting a team togethersize – you’ll need lawyers, insurance experts, engineers, surveyors, architects and planning consultants that you can get in touch with as each stage of your development progresses.
▪ Finding investors for the apartments – as a Sourced franchisee, you have access to a database of active investors, so this shouldn’t prove too much of a challenge.
Benefits of a development strategy
▪ Building a community – if your development is large enough, it becomes part of the community and a potential landmark for your town or city.
▪ Providing great housing – you are offering people a good home and decent environment in which to live. Ok, you’re not ‘giving away’ the properties, but you are making smart, affordable and desirable properties available in the first place.
▪ Hugely profitable – once you have paid those involved in helping you bring the development to fruition, you can bet the profit you make will be larger than any other property started you have invested in. And rightly so, because a development strategy involves a huge amount of time, work and money to get off the ground in the first place.
Get in touch!
If a development strategy is something you’re interested, in then download our Sourced franchise prospectus today.
The franchise is based on a tried and tested business model and you will benefit from our expertise and experience we provide.
Author
Chris Kirkwood
