Fears of a downturn in the housing market due to COVID-19 have thus far been proved unfounded. Buyer demand for new homes soared by 66% after the first lockdown in March 2020, and since extending the stamp duty land tax (SDLT) holiday to June, house prices have increased at the fastest rate in five years.
It’s an exciting time for property developers in the UK, and 2021 could be the perfect year to get started in this lucrative career. Read on to find out all you need to know about building a new career in property development.
Is Property Development a Good Career to Start in 2021?
Property developers usually start their careers when they have some life and work experience behind them (not to mention capital to invest). It’s not a typical first career for school or university leavers because it requires such a vast array of skills, knowledge, experience and connections.
In 2017, the government pledged to build 300,000 new homes every year, and it has made significant amendments to UK planning rules to achieve this goal. These changes are good news for existing and budding developers.
On 31 August 2020, Permitted Development Rights (PDRs) were introduced to make it easier for owners of certain types of buildings to demolish and develop the site. Developers can now change the use of qualifying buildings without applying for full planning permission — a lengthy and costly process. Instead, they must apply to the local authority for “prior notification/approval”, which is designed to be a much simpler and quicker process with a clear timeline.
Removing the need for full planning permission in some circumstances means that more homes can be built more quickly — great news for up and coming independent developers!
How Much Do Property Developers Make in the UK?
Property development can be extremely stressful. Making a profit relies on delivering quality builds and exceptional customer service within strict deadlines and on budget. Is it worth the effort?
According to the job site, Indeed, the average salary for a property developer in the UK is £42,518 per year. However, many developers earn a lot more than this, and some may struggle to break even. Your income will depend on several factors:
- The scale of the projects you take on — will you be “flipping” individual properties or building large scale developments?
- How much you have to invest — can you run multiple projects simultaneously?
- The type of projects you take on — commercial? Residential?
- Your partners — do you have a reliable network of suppliers and investors?
- The health of the market — is there high demand for new houses?
How much you make as a developer will largely depend on how much effort you put into reaching your profit goals.
How Do I Start a Career in Property Development?
Becoming a full-time property developer might not take as much money and prior knowledge as you think. If you have a little life experience, common sense and a willingness to learn, this could be a great career for you.
Your main role as a developer is to spot development opportunities, build teams that have the expertise to deliver your projects successfully and oversee the development to ensure that targets and deadlines are met.
You can get started in property development in five steps:
- Write a business plan and set clear goals
- Set up a company — sole trader, business partnership or limited company
- Arrange the necessary property development finance
- Research local opportunities
- Build a network of reliable, skilled contacts
The key to success as a property developer is to do your research, plan and stay organised. With high demand for new homes and government support for property development, 2021 is a fantastic time to start your career. Put in the groundwork early on, and you could be on your way to a highly rewarding and lucrative career.