How to Become a Real Estate Developer: Career Path Guide
If you want to become a real estate developer, you first need to determine if this career path is a good fit for your skills and interests. Many people ask the question, How to become a real estate developer”? If the following description sounds like you, then you’re probably well suited for a career as a real estate developer:
• You have a keen interest in property development, sales and leasing
• You have a strong desire to work for yourself
• You are able to raise sufficient capital to fund a project
• You understand the factors that affect real estate market conditions
• You are able to recognize potentially lucrative opportunities and predict market trends
• You are able to effectively prepare cost estimates, budgets, and work timetables
• You have a high risk tolerance; you can handle the possibility of heavy financial losses
Below we’ve outlined what you’ll need to begin a career as a real estate developer. We’ve also included helpful information for this career, such as job description, job duties, salary expectations, a list of possible employers and much more!
Real Estate Developer Job Description
Real estate developers oversee the purchase existing or undeveloped residential, commercial or industrial real estate, make improvements to any buildings on it or construct new buildings, and sell or lease the improved land or buildings for profit.
During the process of real estate development, developers are responsible for buying land, negotiating with zoning officials for the purpose of being granted permits, and managing the labor that builds a commercial or residential project, all while overseeing the budget and sales teams.
Real Estate Developer Job Duties
• Liaise with contractors, realtors, engineers, designers, municipal government officials, architects, zoning inspectors, lawyers and other professionals
• Recognize the development potential of specific tracts of land
• Select site for commercial, residential or industrial development
• Secure adequate funding to develop tract of land
• Confer with architects, engineers and designers to establish the design and development plans
• Confer with zoning officials and realtors to ensure the land is zoned properly
• Hire contractors to execute the development
• Negotiate terms and costs with contractors
• Hire realtors to oversee the sale of the developed land
Education Needed to Become a Real Estate Developer
There is no specific educational path for becoming a real estate developer. In fact, many real estate developers make the transition into the career after working several years in other careers that each have their own educational path, such as engineering, urban planning, real estate sales, and other fields.
There are however, many academic fields you can pursue if you want to build a solid foundation in real estate development, such as:
Business – Real Estate: Some schools offer undergraduate business programs that have a heavy focus in real estate. If you are interested in a career as a real estate developer, this educational path is strongly recommended, as it focuses on highly applicable real estate courses in areas such as design, and development project management.
Business – Management: An education in management can help you develop logical reasoning skills, critical thinking and analytical abilities, in addition to learning about modern management practices.
Civil Engineering: A degree in civil engineering can be valuable since it can help you develop knowledge in the construction side of real estate.
Urban Planning: A degree in urban planning will allow you to learn about land-use planning and design concepts.
Many schools in Canada and the United States also offer master’s degree programs in real estate development. These programs are designed to help students learn about the various aspects of a career in real estate development in detail, including design, planning, land use and environmental regulations.
Students enrolled in a master’s program in real estate development can also expect to learn about negotiation, marketing, economics, and deal structuring in all structures, including industrial, office, retail, commercial and residential.
Real Estate Developer Salary
There is no reliable information available regarding how much money real estate developers earn, as they are primarily self-employed. Some real estate developers earn hundreds of millions of dollars, whereas others may lose substantially amounts of money in the development of real estate. If a real estate developer is able to sell and/or lease the properties they develop, and are able to do so at a large margin of profit, then they can make substantial amounts of money.
There are many factors that affect the sales and leasing of developed properties as well as the profit margins of that sale or lease, which in turn affect the earnings of real estate developers. These factors include:
• Whether the property is for residential, commercial or industrial use
• Whether the property being developed in new or existing
• Mortgage and finance rates for initial property acquisition
• Mortgage and finance rates for the party that purchases or leases the developed property
• How much competition there is in their market
• How much demand exists in the market
• The cost of the development project (land investment, materials, labor, professional service)
• The sale or lease price of the property
• Unforeseen challenges, such as changes to land-use legislation and labor shortages
Career Path Options for Becoming Real Estate Developer
There is no set path for becoming a real estate developer; many real estate developers come from a variety of educational and professional backgrounds, and some may begin with no professional experience whatsoever! Below is an overview of common paths for becoming a real estate developer.
Working on Small Projects: Some real estate developers begin their careers without necessarily having any industry experience or education. They being by buying and improving properties and selling them for a profit. Once they have experienced some success with smaller properties, they may be able to raise the capital necessary to work on large development projects, such as a new condominium development.
Working as a Realtor: Realtors acquire a great deal of experience working with lenders, real estate lawyers, investors, sellers and many others close to the real estate industry. They may make the transition into a real estate development career by buying some property to develop on their own, or they may team up with other realtors, clients, and other industry professionals.
Working in the Construction Industry: Those who work in the construction industry as skilled tradespeople or general contractors are able to gain and refine skills that transfer into real estate development. The skills learned by tradespeople may allow them to re-develop a property on their own and sell it, whereas general contractors have a skill set that allows them to oversee budgets, project timelines and other elements of real estate development.
Working for a Real Estate Developer: Many real estate developers begin their careers by working as employees of real estate development companies that focus on specific types of real estate, such as retail or condominium development. This allows them to learn the elements of the business directly from experienced real estate developers.
Working as a Lawyer, Accountant, Architect or Engineer: Professionals such as lawyers, engineers, accountants, architects, and others that work in the real estate or construction industry will likely gain exposure to real estate development from the perspective of their profession, and the experience they have gained in their professions typically give them valuable insights into how to succeed as a real estate developer.
Working as an Urban Planner: Those who work as urban planners can often make a relatively comfortable transition into a career as a real estate developer because of their professional experience. Experience in land use planning, issuing zoning permits and negotiating with property developers is quite valuable for urban planners that plan to become real estate developers.
Skills Needed to Become a Real Estate Developer
Becoming a successful real estate developer requires a well-rounded set of analytical, financial, organizational and marketing skills. These skills enable real estate developers to make the right choices when purchasing, financing, developing, and then selling or leasing properties.
• A thorough understanding of how to manage money
• Knowledge of how to effectively raise capital for development projects
• Able to effectively prepare cost estimates, budgets, and work timetables
• Able to interpret and explain contracts and technical information to other professionals
• Able to effectively collaborate with architects, engineers, and other specialists
• Able to select, schedule, and coordinate subcontractor activities
• Able to effectively respond to work delays, emergencies, and other problems
• Familiarity with legal requirements, building and safety codes, and other regulations
• Able to select the most appropriate property for development based on project requirements
Personality Traits Needed to Become a Real Estate Developer
In order to enjoy your career as a real estate developer, and maintain a positive attitude towards your work, you need a certain set of personality traits. Such traits include:
• A keen interest in real estate development, sales and leasing
• A strong desire to be self-employed
• A strong desire to control your own level of earnings
• Leadership, self-motivation and initiative
• Willingness to take responsibility
• Able to make important decisions
• Able to handle stressful situations and frequent deadlines
• A high tolerance for financial risk
• Enjoy supervising and managing other people
• The mental and emotional stamina to see projects through from inception to completion
Careers Similar to Real Estate Developer
Listed below are careers in our database that are similar in nature to Real Estate Developer, as they may involve many of the same skills, competencies and responsibilities.
• Land Agent
• Project Manager
• Commercial Realtor
• Real Estate Appraiser
References: Real Estate Developer Career Information
Please use the references below to find more information on the various aspects of a career as a real estate developer.
Alberta Learning and Information Service website: alis.alberta.ca
Build a Career in Real Estate Development – Monster.com
Service Canada website: www.servicecanada.gc.ca
United States Bureau of Labor Statistics website: www.bls.gov