So what exactly is a real estate developer? Well, a real estate developer is exactly what they sound like. They develop real estate. A real estate developer is the person that initially goes in before anything really happens before a house gets built before the, the roads get laid out before the pipes get in a real estate developer goes in, in the very front of the project. They literally bought buy the raw land and then they develop it over time to make it suitable, to be built on. So a real estate developer puts all the infrastructure in the sewers that go in, maybe easements need to be gotten from, from neighbors. They plot out the lots, they get it zoned. So the right kind of houses and the right amount of houses could be built on this particular, uh, piece of land. I will tell you if you’re starting looking to get into real estate, real estate development is probably not the best area to start in.
Most people work their way up to being developers. Developers take a lot of risk, a lot of risk. They go into the forefront. You know, they’re the ones who have to have the vision that yes, people will want to live here. People will want to interact here. People will want to make their permanent homes here. It costs a lot of money to be a developer. See banks don’t want to fund a hundred percent of developers deals. A bank may fund 60, 70% sometimes even lower than that. So a lot of developers have to bring their own money to the table. It’s very risky because when a developer starts developing and they start making any kind of money on the sale of the lots or to more to land, guess who gets paid the first, the bank, the underlying mortgage. So if you get your numbers wrong, you may not make your money in the back end. But at the same time, being a developer has a tremendous amount of upside. Some of the biggest players in real estate in the street are actually real estate developers, not for the newbie, but when the time’s right, it’s a great area to tackle.
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