Development strategies - what's worked for you?

Discussion in 'Development' started by Peter Toma, 11th Jun, 2017.

Join Australia's most dynamic and respected property investment community
  1. Peter Toma

    Peter Toma Active Member

    Joined:
    5th Jun, 2017
    Posts:
    40
    Location:
    Sydney
    Hi Guys, For anyone out there who have started & continued a development strategy and transitioned from an employee to their own boss, what has worked for you?
    Has it been quantity of property turned over or building for clients or building duplexes... etc..

    Probably not a straight forward answer but it would be great to know what others have found to be a winning formula.


    Pete
     
    Hayley Cannon likes this.
  2. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    3rd Jun, 2015
    Posts:
    11,331
    Location:
    Perth
    Mine has been three fold since I became my own boss

    I generate income from:
    1. selling some of the completed product
    2. renting out the remainder of the completed product
    3. doing development consulting work to help other people develop.

    I have no specific type of development. It depends on the site and the location and of course the profit
     
  3. Peter Toma

    Peter Toma Active Member

    Joined:
    5th Jun, 2017
    Posts:
    40
    Location:
    Sydney
    @Westminster obviously (or maybe not?) you started it on the side until you were making enough profit to make the transition?
     
  4. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    3rd Jun, 2015
    Posts:
    11,331
    Location:
    Perth
    Yes that's correct. I did it on the side together with my full time job. The job gave me serviceability for getting loans.
    Eventually I had enough to get around 70% of my pay from rent. I didn't necessarily need the extra 30% but I didn't have enough time with a full time job to develop more to get to 100% - nor did I want to work anymore. So at 70% of wages I packed it in and that was 3 years ago now.
    The 30% I've lived without (no work clothes, lunches and hideous parking fees have helped) or made from the consulting work or made from the extra time I now have to develop more and better.
     
    Archaon, Gypsyblood, Perthguy and 3 others like this.
  5. lixas4

    lixas4 Well-Known Member

    Joined:
    24th Jan, 2016
    Posts:
    782
    Location:
    Melbourne
    @Westminster have you written your story in detail anywhere on pc? If so could you please link it. I think your story would be an amazing read
     
    tfk257, David_SYD and Gypsyblood like this.
  6. tfk257

    tfk257 Member

    Joined:
    18th Mar, 2019
    Posts:
    11
    Location:
    Sydney
    Just came across this post. I am in the same boat right now, trying to kick off my property development journey :)

    @Westminster , @Peter Toma , did you guys take any education or course that equipped you with knowledge to start your journey? If not, how did you manage the risk of lack of skills and experience?

    Thank you in advance.
     
  7. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    3rd Jun, 2015
    Posts:
    11,331
    Location:
    Perth
    I'm old school (heavy on the "old" :p) and so put in the hard yards and self taught. I have a naturally inquisitive nature, fairly intense control freak issues but a solid ability to listen to those who know better - together they steered me towards finding people who knew more, joined groups of other developers, read every technical document I could find and didn't rush it. The more time you can put in at the beginning the better it is - I still stuffed up on some entity things at the beginning so you might not get everything perfect but once you know that you don't know something its better than not knowing you don't know something.
     
    craigc, Archaon, Tufan Chakir and 2 others like this.
  8. tfk257

    tfk257 Member

    Joined:
    18th Mar, 2019
    Posts:
    11
    Location:
    Sydney
    Thanks @Westminster for replying, that's really inspiring. I myself have been a self-learner but in subjects relevant to my career "IT & Project management" but given this is a new territory to me , I am a bit worried that I may don't know what I don't know :)
    Would be interested to know when was the moment that you realized that you knew enough to start your first project? and were you in similar situation having a completely different career?
     
    Westminster likes this.
  9. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    3rd Jun, 2015
    Posts:
    11,331
    Location:
    Perth
    Like you I was a confirmed nerd. I worked in IT in the O&G industry which gave me problem solving, project management, a love of spreadsheets, ability to learn "on the job" to stay current, people management skills etc.

    If I was in Sydney (guessing your location is accurate) then I would look at the courses run by the Master Builders Association and UDIA. Both won't have any spruiking, slick salesmen and will contain actual information that should be relevant and helpful.

    It probably took me a year of reading our relevant town planning and design codes and looking at areas to gain data to understand value, the market, potentiality of sites. I'm quite a visual person so that helps when understanding potentiality as sometimes a site may mathematically work but the reality is far different.
     
    Tufan Chakir likes this.
  10. Tufan Chakir

    Tufan Chakir Well-Known Member

    Joined:
    18th Aug, 2016
    Posts:
    872
    Location:
    Victoria, Australia
    Thank goodness someone is actually saying that the mathematics of a site is sometimes (often?) far from reality.... THAT is a really important lesson...
     
    Westminster likes this.
  11. SteakOnThePlate

    SteakOnThePlate Member

    Joined:
    27th Sep, 2019
    Posts:
    22
    Location:
    Sydney
    My story about getting into development / becoming own boss...

    We bought a site in Western Sydney that had a DA to build an attached Duplex (house was already there) and investigated who was getting DA's to identify good designers and town planners.

    From there we got into townhouse development (to keep on the basis we were paying someone else the "development profit" and we could claim the depreciation against salary) but then we realised we could develop and sell.

    That was in circa 2011/12 and we retired from work in 2016 (I wanted to be able to say I retired pre-40 ... and managed it by a month ... not that I have ever said it ... and I am not looking to write books or give courses!) and we are currently funding our own site (12 x 4 bedroom townhouses) that should be complete in about 9 months.

    We didn't do any courses and we just built our network, got more and more experience as we got bigger (larger sites) as we went. I was working at a well known Investment Bank and my wife at a Big 4 firm in Tax and all of this was done "on the side". So we had good jobs and could service a lot of debt.

    We quit when we could see we could generate more income developing rather than working and it's been much more enjoyable than grinding out the hours in a salary job.
     
    The_Billy, Optimus, S.T and 5 others like this.
  12. Westminster

    Westminster Tigress at Tiger Developments Business Member

    Joined:
    3rd Jun, 2015
    Posts:
    11,331
    Location:
    Perth
    Prime example of this is this block in Perth that had the square meterage to be a triplex but a triangle shape. In Perth everyone expects a double garage so to make 3 fit on it one has a tandem garage which will be a big detractor

    upload_2020-6-2_18-12-55.png

    This is what they built https://www.realestate.com.au/property-house-wa-willagee-133600022

    It's not a terrible outcome but they probably could have waited and got a more regular shaped block which would have produced a better outcome.
     
    Tufan Chakir likes this.
  13. tfk257

    tfk257 Member

    Joined:
    18th Mar, 2019
    Posts:
    11
    Location:
    Sydney
    This is classic example, that illustrates how important the finished product should match the target segment needs.

    @Westminster , @SteakOnThePlate really inspiring stories, shows a can do attitude and how realistic the goal is though it requires hard work.
    Yes, I am based in Sydney north west. I looked on UDIA and masters builders association websites. They have lots of technical information which could be a starting point.
    I would add also, a council web site will have a ton of information relevant to the specific area. Speaking of council, do you suggest any thing to look for while looking up which council to focus on?
     
  14. tfk257

    tfk257 Member

    Joined:
    18th Mar, 2019
    Posts:
    11
    Location:
    Sydney
    Have you guys came across the Property Development Network? is it a reliable source of information or material?
     
    lixas4 likes this.
  15. SteakOnThePlate

    SteakOnThePlate Member

    Joined:
    27th Sep, 2019
    Posts:
    22
    Location:
    Sydney
    Yes I have. I went to a meeting in Sydney this year and enjoyed the networking event afterwards; but I haven't paid for any mentoring/training. Given your questions I suggest you subscribe for the current ridiculous price of $99 and watch and learn from other people's deals and what went right/wrong as they have recorded their meetings in bris/syd/melb and there will be a lot of practical examples of what others have done right/wrong etc (Property Developer Network - Annual Membership).
     
    Player, lixas4 and tfk257 like this.
  16. SteakOnThePlate

    SteakOnThePlate Member

    Joined:
    27th Sep, 2019
    Posts:
    22
    Location:
    Sydney
    I am not one of Rob's students (runs PDN) but I have spoken with him and he seems like a good guy and seems to have helped a lot of people (it is a business for him as well of course and they sell training/mentoring). I assume there are people here that are mentored by him.

    But if you consider that for $99 you are getting 16+ meetings from Sydney alone and I haven't checked Mel/Bris as I have only had time to watch a few recently - but they all have a person describing a deal and what went right/wrong for them (and going wrong is more valuable to learn from) ... $99 is so stupidly cheap if you your experience is equivalent to throwing darts at a dartboard. For me, I would just watch that segment for each city/meeting and go back later for other content.
     
    lixas4 and tfk257 like this.
  17. SteakOnThePlate

    SteakOnThePlate Member

    Joined:
    27th Sep, 2019
    Posts:
    22
    Location:
    Sydney
    I checked the content. Anyone that is considering development and hasn't subscribed and viewed /downloaded the content (I use IDM) is not getting content worth tens of thousands worth more. It is ridiculous what he is charging for back-catalogue. You can lead a horse to water as they say.
     
    tfk257 likes this.
  18. tfk257

    tfk257 Member

    Joined:
    18th Mar, 2019
    Posts:
    11
    Location:
    Sydney
    I did already subscribe for this price couple of weeks ago. I watched few sessions, and indeed, it is extremely useful.
     
  19. lixas4

    lixas4 Well-Known Member

    Joined:
    24th Jan, 2016
    Posts:
    782
    Location:
    Melbourne
    Im an annual member of PDN, and a big fan of Rob. I went to most of the monthly meetings in melb until covid. After the event most of us go to the bar afterwards, which normally lasts longer than the event. Rob shouts drinks and food and is very giving with his knowledge. His knowledge is pretty amazing, and like a fair chunk of property developers, he is ex IT.

    I haven't done his mentorship, but if i was new to developing and was going to pay a mentor, then his is the one i would recommend.
     
    Tufan Chakir likes this.