Given I spend a lot of time talking to budding property developers, it's natural that I regularly get asked what someone needs to do to succeed in property development.
While it's important to understand the steps you have to take for success, it's also worth making sure you don't let the inevitable roadblocks and setbacks stop you.
Let's dive into what I believe are the top 5 blocks to becoming a successful property developer.
1. Instant Gratification
Let's face it, we live in a world where instant gratification has become common in so many things we do. Click a button and you can watch a movie instantly, for example. No more trekking off to the cinema or rental store.
Given how ingrained instant gratification is, it's hardly surprising that many property developers starting out are in too much of a hurry to achieve success. As a result, they make choices and decisions that end up hurting them.
If you want to be a property developer, then right from day one you need to recognise that it's a career - not a short-term hobby. Learning to do things successfully takes time, and you need to give yourself the space to do the learning.
Being a developer involves a whole range of skills: due diligence, feasibilities, negotiation skills, money management, project management... I could go on for ages!
Give yourself the grace of recognising you can't possibly be an expert at all of those things on day one of the journey. Then spend time learning at least the basics.
While the sugar hit of rushing might feel great at the time, the slow, steady burn of a property development career is worth the time it takes.
As an example, I generally find that students in my Property Development Formula program are ready for their first deal somewhere between 9 and 15 months into their learning journey. Which means their first payout is in 2 to 3 years.
That leads naturally into block number two.
2. Giving Up Before Succeeding
Becoming a property developer is very much a front-loaded undertaking in terms of effort. You learn, learn, learn, research, research, research... and finally you do a deal.
The learning is hopefully interesting and maybe even a bit fun, but there's a lot of hard yakka that has to happen in terms of research before you can be confident you know what you're doing. And doing it in the right way in the right area.
For all my detailed people, they're probably rubbing their hands in glee and saying "let me at it", bless their cotton socks. Most of us, however, when realising how much work is involved (and in conjunction with block number 1) are sorely tempted to throw our hands up in the air and walk away, leaving them to it.
Am I saying that only detailed people can succeed as property developers? Not at all. The analytical types can absolutely succeed if they overcome their tendencies of perfectionism and analysis paralysis.
For the rest of us, we have to grit our teeth and do the work. The better able you are to understand the process of becoming a successful property developer, the more likely you are to embrace the work because you know it's taking you closer to your goal.
There is no ideal approach for property development, just people who acknowledge their strengths and weaknesses and do it anyway. I was going to say they do the work even when it's hard, but it should probably be ESPECIALLY when it's hard.
3. Limiting Beliefs
It's taken me until now, but here comes the woo-woo stuff! I've said it before, but it bears repeating. A big part of becoming a successful property developer is overcoming limiting beliefs. It's one of the reasons I have two coaches in my education program to specifically help you with mindset.
There's lots of different ways that limiting beliefs can hinder your progress, but for this list I'm going to focus on just one. That's the limiting belief around "why would anyone invest in me when I haven't done a deal yet".
Expanding that out a little, it's the fixation on only doing deals using your own resources. And look, I get it. Property development is already scary when you're new, and the last thing any of us want to do is lose money, let alone money belonging to family and friends.
Despite that, I regularly talk about low or no money ways to do deals. In fact, I'm just about to release a course about it! Yes, I'm going to repeat what is probably my most often uttered quote - don't let your lack of resources stop you from being resourceful.
While some of those low and no money down approaches involve bringing in investor funds, not all of them do. So there is definitely a way to have your cake and eat it too! Mmmmm cake...
Okay, focus! The bottom line is that if you've done the learning and the work, then you should be confident your deal will be successful. Most of us still struggle, which is where block number four comes in.
4. Trying To Do It Alone
Don't get me wrong - you absolutely need to skill up in order to become a successful property developer. However it's also really important to recognise the value of leaning from others to help you succeed, particularly when you're still in the early stages.
How do you achieve that? I've already mentioned my course, Property Development Formula, so that's definitely one way to learn the skills you need along with having access to property mentors and mindset coaches.
Another option is to shadow someone who's already a property developer. Some will be happy to let you do this, although it most commonly happens when you come on board as an investor in a deal they're doing.
Networking with developers is another great way to get support and ideas. Property Developer Network originally grew out of a bunch of mates hanging out at the kitchen table brainstorming about the deals they were doing.
One project of mine took 2 years too long and didn't make enough profit. With good mentoring it would have been a much better deal.
On to the final block I see over and over again:
5. Shiny Object Syndrome
My philosophy has always been 1 strategy - 1 Council - 3 Suburbs. There's a good reason why I recommend this approach. You do the learning to become a Strategy Expert. Next you do the learning and research to become an Area Expert.
Then, when a deal pops up for your strategy in your area, you will know in a minimal amount of time exactly whether it will work or not, and how much you can pay for the site.
Sure, you still need to do your detailed numbers and due diligence for that specific site, but you will have the confidence to move forward a lot quicker. You can at least get control of the site while you're doing all your checking.
This is a much better approach than having to start from the beginning, do all the area research and numbers, only to find someone else has already snapped up the site.
Honestly, I see this all the time. Someone has a strategy and an area, then the agent rings to tell them about a site two suburbs away that's suitable for a different strategy. But the greed gland kicks in so they ditch all the work they've already done and start from scratch.
Not only is this a huge waste of time, but if you rush there's a much higher chance of making a mistake or missing something. That's the last thing you need.
Look, I do understand why this happens. When you're working really hard to find a deal in your own patch but nothing's popped up yet, the temptation of checking out something else that looks like it could work is hard to resist. Shiny objects are... well, they're incredibly shiny!
But when shiny objects pop up on your radar, take a deep breath, then calmly say no. I know you can do it!
So there you have it. The 5 biggest blocks to becoming a successful property developer that I see occurring over and over again. If you can grit your teeth and overcome them, your chances of success will skyrocket.
While it's important to understand the steps you have to take for success, it's also worth making sure you don't let the inevitable roadblocks and setbacks stop you.
Let's dive into what I believe are the top 5 blocks to becoming a successful property developer.
1. Instant GratificationLet's face it, we live in a world where instant gratification has become common in so many things we do. Click a button and you can watch a movie instantly, for example. No more trekking off to the cinema or rental store.
Given how ingrained instant gratification is, it's hardly surprising that many property developers starting out are in too much of a hurry to achieve success. As a result, they make choices and decisions that end up hurting them.
If you want to be a property developer, then right from day one you need to recognise that it's a career - not a short-term hobby. Learning to do things successfully takes time, and you need to give yourself the space to do the learning.
Being a developer involves a whole range of skills: due diligence, feasibilities, negotiation skills, money management, project management... I could go on for ages!
Give yourself the grace of recognising you can't possibly be an expert at all of those things on day one of the journey. Then spend time learning at least the basics.
While the sugar hit of rushing might feel great at the time, the slow, steady burn of a property development career is worth the time it takes.
As an example, I generally find that students in my Property Development Formula program are ready for their first deal somewhere between 9 and 15 months into their learning journey. Which means their first payout is in 2 to 3 years.
That leads naturally into block number two.
2. Giving Up Before Succeeding
Becoming a property developer is very much a front-loaded undertaking in terms of effort. You learn, learn, learn, research, research, research... and finally you do a deal.
The learning is hopefully interesting and maybe even a bit fun, but there's a lot of hard yakka that has to happen in terms of research before you can be confident you know what you're doing. And doing it in the right way in the right area.
For all my detailed people, they're probably rubbing their hands in glee and saying "let me at it", bless their cotton socks. Most of us, however, when realising how much work is involved (and in conjunction with block number 1) are sorely tempted to throw our hands up in the air and walk away, leaving them to it.
Am I saying that only detailed people can succeed as property developers? Not at all. The analytical types can absolutely succeed if they overcome their tendencies of perfectionism and analysis paralysis.
For the rest of us, we have to grit our teeth and do the work. The better able you are to understand the process of becoming a successful property developer, the more likely you are to embrace the work because you know it's taking you closer to your goal.
There is no ideal approach for property development, just people who acknowledge their strengths and weaknesses and do it anyway. I was going to say they do the work even when it's hard, but it should probably be ESPECIALLY when it's hard.
3. Limiting Beliefs
It's taken me until now, but here comes the woo-woo stuff! I've said it before, but it bears repeating. A big part of becoming a successful property developer is overcoming limiting beliefs. It's one of the reasons I have two coaches in my education program to specifically help you with mindset.
There's lots of different ways that limiting beliefs can hinder your progress, but for this list I'm going to focus on just one. That's the limiting belief around "why would anyone invest in me when I haven't done a deal yet".
Expanding that out a little, it's the fixation on only doing deals using your own resources. And look, I get it. Property development is already scary when you're new, and the last thing any of us want to do is lose money, let alone money belonging to family and friends.
Despite that, I regularly talk about low or no money ways to do deals. In fact, I'm just about to release a course about it! Yes, I'm going to repeat what is probably my most often uttered quote - don't let your lack of resources stop you from being resourceful.
While some of those low and no money down approaches involve bringing in investor funds, not all of them do. So there is definitely a way to have your cake and eat it too! Mmmmm cake...
Okay, focus! The bottom line is that if you've done the learning and the work, then you should be confident your deal will be successful. Most of us still struggle, which is where block number four comes in.
4. Trying To Do It Alone
Don't get me wrong - you absolutely need to skill up in order to become a successful property developer. However it's also really important to recognise the value of leaning from others to help you succeed, particularly when you're still in the early stages.How do you achieve that? I've already mentioned my course, Property Development Formula, so that's definitely one way to learn the skills you need along with having access to property mentors and mindset coaches.
Another option is to shadow someone who's already a property developer. Some will be happy to let you do this, although it most commonly happens when you come on board as an investor in a deal they're doing.
Networking with developers is another great way to get support and ideas. Property Developer Network originally grew out of a bunch of mates hanging out at the kitchen table brainstorming about the deals they were doing.
One project of mine took 2 years too long and didn't make enough profit. With good mentoring it would have been a much better deal.
On to the final block I see over and over again:
5. Shiny Object Syndrome
My philosophy has always been 1 strategy - 1 Council - 3 Suburbs. There's a good reason why I recommend this approach. You do the learning to become a Strategy Expert. Next you do the learning and research to become an Area Expert.
Then, when a deal pops up for your strategy in your area, you will know in a minimal amount of time exactly whether it will work or not, and how much you can pay for the site.
Sure, you still need to do your detailed numbers and due diligence for that specific site, but you will have the confidence to move forward a lot quicker. You can at least get control of the site while you're doing all your checking.
This is a much better approach than having to start from the beginning, do all the area research and numbers, only to find someone else has already snapped up the site.
Honestly, I see this all the time. Someone has a strategy and an area, then the agent rings to tell them about a site two suburbs away that's suitable for a different strategy. But the greed gland kicks in so they ditch all the work they've already done and start from scratch.
Not only is this a huge waste of time, but if you rush there's a much higher chance of making a mistake or missing something. That's the last thing you need.
Look, I do understand why this happens. When you're working really hard to find a deal in your own patch but nothing's popped up yet, the temptation of checking out something else that looks like it could work is hard to resist. Shiny objects are... well, they're incredibly shiny!
But when shiny objects pop up on your radar, take a deep breath, then calmly say no. I know you can do it!
So there you have it. The 5 biggest blocks to becoming a successful property developer that I see occurring over and over again. If you can grit your teeth and overcome them, your chances of success will skyrocket.
