Summary: Bob Andersen, Property Development Expert, reveals to you the six major steps involved in successful property development. In this month’s newsletter, he gives you a quick overview of the six steps, and goes into a lot more detail on the first and significant step – how to find a site. Hi, Bob Anderson back again in our next video on our sessions on successful property development. In the last episode you remember we smashed some of the common myths or lies out there about property development. Things like you’ve got to be really wealthy to do property development or you have to give up your day job to be a property developer or you need decades of experience. Hopefully we’ve smashed those so what I want to do here is to move on in the real nitty gritty of how to put a property development together. Now, quite simply, property development or successful property development consists of six steps. Like everything, there’s a formula to doing things correctly. I’ll just run through those six steps now and what I want to do is spend each session going through in more detail each of the six steps. Okay, so let’s go through those six essential steps. Step one, find a site or a deal. Step two, we need to do our due diligence and look at the feasibility of it. Step three, will be finance. Step four, gain the approvals. Step five is the construction and step six will be our sales. Now they’re the six essential steps. What I’m going to do now is I’m going to into a lot more detail about the first step and in future episodes I’m going to take each step one at a time and go into further detail. Let’s start with step number one, finding a site. When we’re looking for a site or a deal, there’s basically two types or two areas to look at. One is what we call on-market sites and the other one is what we call off-market sites. On-market sites, they’re actually properties that are for sale today on the market. We can find those in a various number of ways, typically, real estate agents; but not just any real estate agent. What we’re looking for here, because we’re looking for a development site, there are certain real estate agents who specialize in selling development sites. Now these are the guys you will often see marketing new projects, they’re opening open houses for new projects. You’ll see them on realestate.com advertising projects. Quite often in an office, you’ll have agents that sell normal second hand stock but then you might have a specialist that sells new stock. Those agents nearly always sell sites as well. Number one, that was real estate agent. You know that you can actually pay somebody to find a site for you. They’re called buyer’s agents. Now it’s a certain type of buyer’s agent that we’re looking for; not the buyer’s agent that might go out and find you a property, an investment property, a home or a unit. There are buyer’s agents that specialize in finding development sites. They understand a bit about property development. They understand about the town planning aspects. These are the guys that you need to locate. Buyer’s agents go out into the marketplace and find sites for developers; certainly, you have to pay them something for it, often about 2% of the land value. It can really cut your time down and really narrow the focus down. I never worry about the little bit of money that you spend on a buyer’s agent. It can be really money well spent. Then of course there’s the internet these days such as realestate.com and the other portals. I’ve actually bought properties, bought sites off realestate.com and you can narrow the fields down as well. And then of course there’s the print media; magazines, local papers, the major papers where agents or even private sellers in some cases are advertising their property. They’re the on-market sorts of deals. They’re the markets that are out there. They’re on the market and you just need to locate them. There’s another type of opportunity that we call off-market. These are ac[...]
