Well basically I'm a 17 year old Perth kid. I'm self-motivated and have a desire to be a successful investor as well as an entrepreneur. For some time I've been interested in becoming a property developer, the reason being is the fact that it can be a lucrative investment if done correct. I have done research on developing and am aware that property developing can make or break a budding developer financially, as well as requires a lot of hard work that will be a tough for someone inexperienced. So what i believe i need is someone that can take the time and mentor me.
Or just give me some general advice i need to consider.
Either way i appreciate any advice given
Thank you
Good luck mate! Hope you achieve everything you set out to do, and it seems like you have the right frame of mind – which is just as important as the know how
I would suggest getting a job in the industry, whether it be as a labourer, in a supervisor role, contracts management, project management, as an architect, engineer or anything. This would be really beneficial as you would be immersed in the industry for 5-6 (or 7!!) days a week and you will learn quickly. You will also find and meet people who will be able to guide you on your way. You need to have experience in this field otherwise you may get very badly burned.
One of the problems you may run into is having the capital to start. Without significant experience and/or capital, then it is impossible to develop property.
Congratulations on establishing your goals, you will no doubt achieve them with the right planning and frame of mind!!
Cheers,
LukeWith that attitude, I say, "Go for it mate!". Take your big risks early, while you are young, and don't be afraid to fail catastrophically. You haven't got much to lose, so you may as well lose it now or win big. (I know this sounds totally irresponsible, but I am hoping that doesn't matter to you.)
Apparently Edison failed with his first 300 light bulbs, they were duds. But with each failure he learned how to make one that finally worked.
Don't try too hard to be an expert before getting started. All that "expert" knowledge may actually end up preventing you from innovating and creating something truly brilliant.
The capital thing will be a challenge, but it will force you to find new ways to do business that someone with alot of capital would not otherwise discover.
Knock yourself out and keep us posted on your success!
FYI – I am not a developer. But I am an innovator in a different field. I think the fundamental principles of innovation are universal.
Ravi, as a 17 yr old 'developer' (i think at 17 you are still developing anyway ! ), I suggest you go out and start looking at what people are doing and how they are doing it. First, dont think you can just rush in and make a mint. I used to deal with these sob stories of nutters who think the gold lies in just purchasing a property. No, it lies it buying the right property at the right price .. at the right time. A magic equation that seems to go past most property investors and developers.
From my experience, 70-80% of purchasers aim for the 'get rich slow' line, where their prospects for the properties are generally long term whether for investing or for living or FHB. The other 20% are the flippers and the renovators and the idealists/developers. These people can range from very smart in what they do …… to totally overcalculating or just being unprepared for interest rate hikes.
Make no mistake .. the core reason your properties will be worth anything at all is because there are a large bunch of people who are that 80% who hold on to their properties .. some .. for a lifetime. They provide the scarcity value for actually having a residential property.
As a developer you want to save money .. but you also want to be in a position to know when its necessary to invest it. Skimping on kitchens because you overspent on development .. a nono. A fabulous apartment layout and cheap carpets? Again .. you lose your investment because its underrated. Learn where to make deals and when to accept what you are getting because its good.
For starters, build your bank. In the current climate you arent going to be able to flip easily but you may be able to clip some vendor financed deals together. With starting out, you need to be creative. You need to see options to make a deal where someone else doesnt. Doesnt mean you lose your creativity later on, but you need to learn it to start with.
xdrew, that was an awesome read.
I wish I had the balls to even THINK about being a developer!
Alrighty Ravi,
Nice thinking of going in the property development area. For starters you're gonna run into a lotta problems if you think about buying a property or what not before your 18 (yes tax is a bitch) so in the mean time I suggest you learn more about the property industry. If you're still in school stay in school, if not I suggest getting into sales and if you can getting into sales within the property industry. You'll need the skills and business sense that sales provides and you'll gain some knowledge as everyone has been saying by getting a job in the property industry.
When you do turn 18 and are still commited to becoming a property developer I would be making some key contacts with people in the industry. That means getting off your ass and going to conferences, ringing around, walking into businessess and getting thrown out. It bassically shows that you're commited to what you say and that you're not like anyone else. Personally I wouldn't get into property developing but I'd get into buying investment property, especially buying off the plan. You need to know what renevations/refurbishments (if any) are going to be important to get maximum capital return on both your rental yield and capital gains.
The reason why I right get into property investment insead of property development is because getting the right property in the right area doubles in value every 7-10 years. As opposed to buying a piece of land/property forking out all your own money, spending a lot of time and effort to get it built and then spend a bit of extra time trying to sell it for a price that will make it be worth your while.
If you're interested in knowing more send me a message and let me know as I have a couple of contacts in the industry
Hi Ravi,
Like yourself living in Perth, I had an interest in property from a very young age. Now 22, I've completed my first project (started at 21) and working on my next deal. I work in the industry full time, helping other investors build wealth. The job I have is quite lucky as our companies MD puts a lot of effort into training and has a strong foundation to integrity (which you can often loose working in the RE industry).From personal experience if you want some tips, here is what has helped me get to what I enjoy doing:
1) I started working in a RE agency at 17 (helping out). I did junior work and on rare occasions was allowed to do some “cold calling”. So lets put it this way, I was doing all the jobs worse then the main one most RE agency despise (cold calling). This will be a good test to see if you will have longevity in the industry. If you didn’t enjoy doing the grunt work, move on. From this experience, the fundamental thing I learnt was to have a thick skin – that is not to be confused with being obnoxious.2) Next tip is to get a good foundation in sales. This is regardless of if you want to be a developer or work in the industry. Being great at sales is by far the best skill anyone can learn and don’t let anyone suggest otherwise. The main reason some people think sales people are scum is because many people aren’t good at sales. Sale’s is important, because you will always be pitching and idea to someone. After working at the RE agency, I worked at Godfreys (vacuums) and despite the sometimes bad stigma. They have a really good training ground for sales. I would suggest looking at a part time job there.
3) While learning selling at Godfreys, I went to uni. I studied economics and this provided me a good foundation on investing (my majors were money and banking / international business economics) This mix doesn’t sound too relevant but it gave me a good insight into accounting, investment, risk modelling and other practical skills such as the ability to teach myself things and MS excel/report writing. I’m able to apply this knowledge to investing; this fortunately takes many rope learnt investors quite a few years to master. I would suggest doing a finance degree of some sort.
4) I did a lot of adult education. I went to as many seminars as I could and studied as much about property as I can. This gave me a really good foot up into understanding how the industry works and where I want to go for the future. I was quite fortunate as my family invested in property and this helped motivate me. Now this may sound like a conflict of interest (because we do property education), but I would encourage you to buy a course or two and buy as many books as you can. Aim for education other just written, such as seminars, you will retain more knowledge (I studied courses before working at MW).
5) I didn’t just apply for any RE jobs, because they can bog you down in the selling side. What I mean by that is if you work for a selling agent, they will teach you how to get listings and that is pretty much all you do. Now this is not a bad thing, but it will take many more years to learn about property. Often with little support. I would suggest working at a smaller development company / valuations company / buyers’ agency or a smaller selling agency. These firms will give you the research skills you’ll need to succeed. Albeit, sales is important, but you do actually want to learn about property.
6) If you do go to a selling agency / buyer’s agency get ready to take on the 600 day war. For the first 2 years of your life, you will need to work your bum off in order to get to know people and build up your professional network. That means lots of cold calling, networking and rejection. But hopefully, everything you have learnt in the prior 5 steps will help you through that.
The only other bit of advice that I would encourage, as bad as it sounds; the only person you can trust in real estate is yourself. The above 6 things is what helped me, but always remember real estate is a meritocracy so someone who hasn’t passed year 12 can be rubbing shoulders with a MBA.
To your success,
KentThat was a good read Kent.
Wow, thank you everyone for all of that advice. Reading all of this was great and very much appreciated.
I have a lot of questions to ask, but won't worry about them right now.Also, has anyone heard about property options? I have just recently come across this and don't know too much about it, but i am very interested.
Apparently you can control a property without buying it through an option. Options are just a contract basically saying that you can buy the property but you don't have to. Which has it's advantages, for example: say the option is for 12months, the value of the house may have increased allowing you to buy the property at a lower than market price, without paying for the mortgage, maintenance, etc. during the 12months. Also with an option you can put a Development Approval (DA) on the property without owning it, if the DA is approved than the value of the property immediately is increased, allowing you to sell the property option to a developer for a nice profit or even developing the property yourself under the option.
I like the idea of using a property option as well as a DA to force value into the property. Also you do not need a large capital to get an option on a property, approximately 10-20k and profits can be up to 100k. It seems like the perfect way to get experience into the Property Development industry without having so much risk.
This is what i gathered in the last hour or so, and i may be wrong about it.
Also i am surrounded by negativity, I'm guessing it is since i am surrounded by poor/middle class people. I'm literally a one man army. People i know see that I'm trying become financially free and they all talk about it, they say I'm going to fail, that investing is for rich people only, I'm only going to lose money, starting a business is to hard. It's getting to the point that they think they can make jokes about me. I can no longer talk to even my closest friends about my vision and goals. They simply just don't understand where I'm coming from.
Well i guess I've put up with enough of this negativity, that i have decided to search for like-minded people. I want to be with people who are like me, or are better than me who i can learn of.
So to give everyone a thought of what type of person i am;
I am 17 years old, born and raised in Perth. Both my parents are poor and have given me this belief system that life is hard work. That i am suppose to go to school, get good grades to go to Uni, secure a well paying job and work the rest of my life. I don't like that belief and decided to study rich and successful people. Such as Nik Halik, Richard Branson, Jamie McIntyre, Robert Kiyosaki, Jordan Belfort just to name a few.
I graduated year 12 in 2010 and have been working since, (actually i have just been fired by my boss, due to going to Melbourne for a conference), saving almost all my money.
I have a plan to get rich through investments, i have many goals in my life. I'm single and i think I'm quite the good looker, so ladies feel free to contact me hahaha.But with all seriousness i am looking for like-minded people, my email is [email protected]
Thank you again for all your comments!
Hi Ravi,
There's nothing with wrong with your parents advice. "Both my parents are poor and have given me this belief system that life is hard work. That i am suppose to go to school, get good grades to go to Uni, secure a well paying job and work the rest of my life."
Absolutely nothing wrong with it going to Uni, getting good grades, secure a well-paying job and working. Kent is an example of that. Just read his post in its entirety. The good news though is that Kent, and you, will likely also play hard. what with all the money you'd make.
Murdoch is one of the richest man on the planet, he's a geriatic and he's still working. He can afford to rest on his laurels but he doesn't.
My parents are self-made millionaires. My mum in particular didn't set foot in a school yard, let alone a classroom. She taught herself to read and write with the help of a tutor when she got married and had kids. She knows what anyone with guts and intelligence can achieve even without an education but she got us all to Uni nevertheless.
Parenting is tough and they, your parents, can only guide the best way they know how. It isn't being negative. It is being prudent and careful.
By all means, Ravi, go and follow your heart. You are very young, take your time. It doesn't happen overnight but it will happen.
You will get rich. Keep swimming. Save, Work, Invest, Manage.
Swimmingly,
Angel
Great advice Kent. Very well considered.
Just on the uni topic…
Whether you like it or not, and whether the subject matter taught in courses at uni is relevant or not, quite often, having "a degree" is the required entry ticket to a lot of high-paying jobs. High paying jobs means income which means servicability for lots of property loans. It's kinda hard to get ahead in property without loans.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Hey Ravi,
I find myself in a situation similar to you. A lot of people will find it hard to understand where you want to go at your age. I'm sure you've read Kiyosaki's books… it isn't something we are taught at a young age!
What your parents said about going to Uni isn't a bad idea though — like JacM said, that piece of paper is what will allow you to be 'qualified' to work in a higher paid job.
I think some of the suggestions by Kent – that is, getting in to the property industry somehow – is something that you should look in to. Basically, without a decent income you aren't going to be able to deem yourself eligible to service loans anyway so, that should be your primary concern at the moment as well as trying to reasearch!
Ravi,
One other thing, there is something so bold and unconventional about options. So romantic and glorious. But the authors of these books forgot to tell you that options doesn't happen everyday. You will make hundreds of offers before one even happens. On top of that, these properties need to be very specific. It can't be any property.
People think, "oh I can do this with no money." What they actually mean is not huge money, but money you will need.
Regardless of what books tell you, reality is a different kettle of fish.
Like what everyone has already said, you will need to obtain some kind of leverage and that means loans. No income, no loans. Small income, small loans. Big income, big loans.
Do not under estimate the value of a "piece of paper." If uni is not for you, then get a trade in the industry. an apprenticeship or a certificate will do for a start.
The richest people I know are carpenters, brick layers, plumbers (especially), electricians (more so), roofers, don't forget the landscaper. They leverage their skills. Talents. Mates.
Fuel your desire with your enthusiasm. You will get there. Self-belief is 70% of the whole lot.
Take care.
angel
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