Real Estate Developers in Columbia SC | 5 Important Steps of Success
Many people in the past 10 years have decided to join the real estate revolution by investing in lots and acreage in South Carolina. But this can be a hard-nosed business…and quite a risky one. It doesn’t take any special licenses, degrees, or educational requirements to develop a neighborhood, but it will take some capital and knowledge of the area. With any business you should know the market before you decide to take a dive into real estate investment on a scale this large. There are several factors that can ruin your vision and most of them are out of your control.
I’ve known very successful businessmen and real estate developers in Columbia that have unknowingly pushed themselves over the limit with bad investments. Many of the people that I envied because of their success have lost everything because of bad decisions. Here are a few tips that I’ve learned over the years as a developer and licensee.
Have a marketing plan. Sure, it sounds simple, but most real estate developers aren’t in tune with how buyers think. I’ve seen a developer sell hundreds of units in a single day because of their marketing plan and energy to find buyers that are looking for a hot deal. People were standing in line paying a premium for land that didn’t even have a buildable site on the property. So before you decide to buy property, know what you are getting into.
Know the process. When developing property it is important to know the process. Every State, County, City, and Township will likely have a different set of zoning regulations and requirements that you must meet or abide by prior to developing land. You shouldn’t depend on anyone but yourself to know these rules. A good developer has done this over and over again and knows what steps to take first. It’s much like a builder building a house. You wouldn’t want your roofing/shingles to be delivered on site before you begin to dig the foundation for your new home, would you? The same concept applies to real estate development.
Consider holding costs. Any 2nd homeowner will tell you about this. In a real estate development, you are working on a much larger scale and need to consider the larger costs that come with your investment. Interest, taxes, insurance, and maintenance can kill your profit. So be aware of these costs before you sign a contract.
Reward your real estate agents. Sure, I may be biased because I am a real estate broker, but look deep into why you have a real estate agency. They are, hands down, the most important people in your investment. A good real estate agent can give you a fair market price and a quick sale if you listen to them. Don’t be afraid to question their decisions if you believe that things should be handled differently. On the otherhand, don’t try to control their action plan.
Pay your contractors. Again…simple… but often overlooked. Pay your contractors as scheduled. Paying as stated in your contract is good business. Many times the contractors will help market your property if they feel that you are contributing to the local market. Also, make sure that the work has been completed as requested before handing out money. Paying by the job completion is much less confrontational than a time frame.
If you are looking into buying a real estate development for sale in South Carolina feel free to contact us to see if we can help. We will often buy and sell land for development if you are hesitant in undertaking a large project. We don’t typically enter into a contract to develop property unless we have an interest in the project.