10 Tips to a Successful Build-and-Sell Real Estate Business
With the country’s vibrant economy, Filipinos nowadays are finding themselves capable of finally purchasing their own home. This presents an opportunity for business-savvy individuals to cash in on the trend through a build-and-sell business.
Building a house for profit is a huge task that requires utmost dedication on the part of the builder. However, it can also be very rewarding both financially and emotionally, said Maria Cristina R. Legaspi, a licensed real estate broker, appraiser, and consultant, a former national president of the Real Estate Brokers Association of the Philippines (REBAP), and now a savvy businesswoman.
But first things first: although a build-and-sell business is potentially lucrative, it is not something that should be done on a whim without planning for an abundance of scenarios.
Legaspi added,
"A person driven enough can make a lot of money from real estate through build and sell. But it takes a lot of dedication, a strategy, and a good understanding of what homebuyers want.
During the 3rd General Members’ Meeting of REBAP held last September, Legaspi shared some tips on how to successfully run a build-and-sell business."
1. Due Diligence, as Usual
Build within a land that’s legally yours. To be sure, hire a good geodetic engineer to determine the metes and bounds of the land on which you plan to build a house. This will save plenty of headache, and will make sure to prevent a potentially costly lawsuit should you accidentally built a structure on somebody else’s land.
2. Determine Your Market
Which market segment you’re specifically targeting? This will allow you to determine what type of home to build. A single detached with a four-car garage in a suburban gated community, for instance, is quite popular with dual-income growing families. However, make sure that the area is accessible to schools and commercial areas, the kind of amenities that families with small kids usually need.
3. Organize a Great Team of Professionals
This involves getting an architect, an engineer or a contractor, and an interior decorator or designer. “People are good at what they do,” Legaspi enthuses, “so it’s best if you let other professionals do their job.”
Architects, for instance, are great in designing an impressive structure when looked from the outside, but they do average when asked to do interiors, on which case interior designers are best for the job. Also, don’t scrimp on contractors.
Legaspi said,
"A contractor who charges, say, Php10,000 per square meter but delivers an excellent job is way better than one who charges Php5,000 but whose work is substandard."
4. Don’t Underestimate the Value of Greens
A well-manicured law or garden makes a good first impression. Hence, it makes a lot of sense to hire a good landscape architect to design you one. Quite a rarity in most urban areas, a nice garden makes a house very truly livable, and it’s quite popular with families with small children.
5. A Diligent Warehouse Keeper Is Worth His Weight in Gold
In an ideal world, people are honest, trustworthy individuals. In the real world, some can be kind of shady. It’s worth keeping a reliable warehouse keeper then, to make sure that your inventory of materials are kept in check, especially the pricey ones.
6. Allot Time and Resources for a Pre-construction Treatment
It’s not enough to build a sound structure under which people will live—the house should be safe and livable as well. Before commencing on building the structure, make sure to hire a professional to do a preconstruction termite treatment. In addition, being in a tropical country, make sure to waterproof balconies and bathrooms. Roofs should be insulated for heat and leaks.
7. Bowl Your Buyers Over
There are certain things that draw people to a new house: a great garden, a cozy verandah, or a spacious kitchen. Then there are others that just floor them.
Legaspi explained,
"A walk-in closet, for example, provides that wow factor. Perhaps it’s something that most only see in movies, and when they see one they get bowled over. This little add-on is also quite rare in today’s market of matchbox-sized condos. In addition, amenities—such as clubhouses, gyms, parks, and playgrounds—can get buyers really excited."
8. Let a Trusty Administrative Assistant Do the Organizing for You
When building something there are a host of permits and fees that need to be sorted out. Hire a trustworthy administrative assistant to deal will all these. A mayor’s permit, barangay clearance, and even applying for a line with the power provider will eat a huge chunk of your time, not to mention will test your patience, so better let another person worry about that for you.
9. Location, Location, Location
Now having said all of this, it’s time to delve into that one principle that’s universal in real estate, said Legaspi. This doesn’t mean one has to get a very pricey plot in, say, Forbes Park or Dasmariñas Village only to get the finished house sold. Take note also of the general condition of the neighborhood.
"Have the common sense to pick an area that’s accessible to Metro Manila’s CBD, where people likely will commute to every day."
10. Establish a Good Relationship with Suppliers
They say that the real estate industry is directly connected to at least 20 other industries; hence, it’s a good idea to establish good relationships with the people involved in them. Not just to engineers, interior designers, architects, and contractors, but also to suppliers. You might even get a good discount just by being on good terms with them. This makes perfect sense. After all, your success is also theirs.
Engaging in the building and selling of properties can be your path to fortune, said Legaspi. But just like any business venture, the road to it can be perilous and there are many pitfalls to avoid. Learn as much as you can then before risking your hard-earned cash.
Source: ZipMatch
