PROPERTY DEVELOPMENT BUSINESS PLAN: 2023 UK Template & Guide

  • by Folakemi Adegbaju
  • August 9, 2023
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  • 8 minute read

PROPERTY DEVELOPMENT BUSINESS PLAN TEMPLATE

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The importance of having a business plan, #1. executive summary, #2. company overview, #3. market research, #4. customer analysis, #5. marketing plan, #6. swot analysis, #7. management team, #8. financial plan, #9. appendix, property development business plan template, how do you start a property development business, is property development profitable, how much money do you need to get into property development, how can i start property development with no money, where do property developers get money, what qualifications do i need to be a property developer, what makes a good property developer, do you wish to finish your property development business plan in 1 day, final thought, what does a property development company do, what does a property developer actually do, why do property developers make so much money.

Do you need a business plan to launch or grow your property development business? A business plan or investor presentation of some sort will likely be required to attract investors. A business plan is a crucial foundation for property development companies because it details the management and operations of the company and seeks to attract investors. We have a ready-to-download property development business plan template to make it easier to write your plan.

What is Property Development Business Plan?

A property development business plan is a written document that details your intended business’s structure and operation. The first fallacy is that a property development business plan cannot be changed. In other words, it’s a living, breathing thing that changes as your ideas develop and you flesh out the finer points of the project. It provides a structure within which you can organize and modify your ideas as necessary.

The property development industry requires a business plan that is similar to the standard business plan but with more emphasis on the specifics of the industry. You’ll also give more consideration to the finer points of the property development sector. Your property development business plan will account for any factors that will have an out-of-the-ordinary effect on your company.

You need a business plan if you want to start a property development business or expand an existing one. You can also increase your chances of success in the property development industry by putting together a thorough business plan that you will use to solicit investments and map out the company’s future expansion. Get in touch with us at Business Yield Writers if you struggle to put together a comprehensive plan in writing. Our team has extensive experience in writing successful business plans for the property development industry, and we can use the data and insights gleaned from our collaboration with you to develop a comprehensive plan for meeting your specific goals.

How to Write a Property Development Business Plan

There’s always that anxiety about starting to write a business plan for your business, but you need to know that it’s important that you know how to write a business plan for your property development business. Download our property development business plan template to help you construct a plan of your own.

Although it serves as an introduction to the rest of your business plan, the executive summary is typically written last because it summarises all of the other major sections.

Your executive summary should quickly interest the reader and get them to read the rest of your work. Also, educate them on the nature and current state of your property development business. 

The nature of your company will be described in your company overview.

You could, for instance, focus on a specific kind of property development company, such as:

  • Single-family detached housing: Developers who specialize in single-family detached homes create properties that are not attached to any other structures.
  • Multifamily housing: Developers specializing in multifamily housing construct apartment complexes, condominiums, and other mixed-use projects.
  • Developing and Subdividing Lots:  Subdividing and developing lots involves the purchase of developed or undeveloped land, it’s subsequent clearing and its subsequent sale to builders.
  • Commercial buildings: Developers specializing in commercial properties construct and manage office and retail complexes.

The company overview should provide context for the business in addition to describing the nature of the property development company you intend to run.

Market research is essential to any industry and it allows you to have a deep understanding of the market you’ll be going into. The best way to do it is to do market research first. Look at overall data within the market, as well as more niche data sets. You can use this method to create a successful plan for expanding your business.

Your property development business plan’s customer analysis needs to include specifics about the types of clients you currently work with and those you intend to attract in the future.

Customers can be broken down into groups such as individuals, families, and local businesses.

You should also segment your potential buyers by their demographic and psychographic characteristics.

Also, a customer’s wants and needs can be described in detail using a psychographic profile. A company’s ability to attract and retain customers depends on its ability to identify and meet these needs.

More and more people are opting out of using an agent entirely, and this means you have a wide variety of options when it comes to selling and advertising your property.  Find out what’s new in marketing, and talk about the social media other approaches you’re thinking about trying.

 If you’re trying to convince banks or investors to give you money, this section is crucial. The four pillars of SWOT are material costs, current market values, projections, and competitors; write down everything you can think of that fits into these categories.

Your property development business would also benefit from a business plan, even if you are not actively seeking investors. Your understanding of the risks increases, and you can adjust the rest of your strategy accordingly.

Do not put a description of the company’s staff in the middle of your business plan; instead, put it either at the beginning or the end. Director names and bios, a list of any outside consultants you can expect to work with on a long-term basis, and a clear depiction of the organizational structure should all be included.

This section lays out your financial forecasts, arguably the most crucial part of your business plan. Projected profit margins should account for profit as a percentage of revenue, profit as a percentage of costs, and return on investment, all three of which can be more easily understood than a single numeric value.

You can also learn more about the methods used to evaluate profitability in property development if you need help determining how to arrive at a number for this.

In addition to an annual financial statement , your 5-year financial plan should also include monthly or quarterly projections for the first year. The three main documents that make up your financial statements are the income statement, the balance sheet, and the cash flow statement.

Include a full set of financial projections and any other supporting documents that will help your plan stand out in the appendix. You can also add a detailed plan for your showcase properties and a rundown of the various construction methods you employ.

A persuasive property development business plan for your company requires not only following the aforementioned steps but also making use of a template checklist. Also, the essence of a checklist is to help you keep track of all the necessary processes you need to achieve while starting your new business.

However, we advise you to download our property development business plan template to make sure you follow the right steps while writing your property development plan. Here is a property development business plan templat e checklist:

  • Join a property development community
  • Narrow down your niche
  • Have a financial plan
  • Get your management team
  • Get a business plan
  • Adopt a marketing technique 
  • Manage the properties

To start a property development business, you’ll need to:

  • Pick a name for your company
  • Register your company with Companies House or a formations agent
  • Register your business address
  • Appoint your directors and a company secretary
  • Allocate shareholders and shares
  • Submit your memorandum and articles of association
  • Register for corporation tax

Yes, it is.  if it’s done right, property development is extremely profitable. Once you understand how things work, you can make careful plans and avoid pitfalls so that you can put all of your energy into making as much money as possible.

The scope and scale of a development project will determine the financial resources required to complete it. Generally speaking, you should have between 25% and 35% of the total estimated cost of development.

You can start a property development business with no money with the following means:

  • Visualise Your Success
  • Learn about the Industry
  • Get Some Hands-on Experience
  • Informal Loans
  • Commercial Finance
  • Commercial Mortgages
  • Buy-To-Let Mortgages
  • Auction Finance

You might be asking about how a property developer gets the money . I want you to know that it’s possible that a property developer gets approved for a loan from a private lender who specializes in property investment. In addition to traditional mortgage lenders, there are countless online and offline resources dedicated to finding investors for new construction projects of all sizes.

To begin a career in property development, formal training is unnecessary. However, furthering your education through coursework is one way to boost your credibility with potential clients and expand your knowledge in areas like planning regulations.

The following makes you a good property developer:

  • Know your exit strategy, know your plan
  • Write a business plan
  • Work out your financing
  • Know your target audience
  • Have a vision

Creating a business plan from scratch is a tough task, especially when it is your first time, but the good news is that you are not alone. However, it’s understandable that you become fixated on a certain aspect of your plan; all you need is some guidance or an already made property development business plan. Here at Businessyield Consult, our experts assist business owners in creating a winning business plan. We’ve assisted numerous companies, and we’re always up for taking on more. Why not get our already made property development business plan today?

Considerations such as the intended audience (whether investors, third parties, or banks) are essential in crafting a successful property development business plan. They need to hear from you directly, and you need to make sure the plan is well-researched and convincing before you approach investors with it.

If you have trouble composing one, you can choose our already-made property development business plan to get your business running.

They make a living erecting new structures and restoring older ones to resell at a profit.

Property developers are responsible for overseeing the entire process of designing, obtaining approval for, building, and selling new properties, including managing architects, builders, real estate agents, and other third parties.

Property developers generate a profit when they sell a piece of land for more than it’s worth. They accomplish this by constructing multiple homes on a single lot and subsequently subdividing them into smaller units.

Property developers generate a profit when they sell a piece of land for more than it's worth. They accomplish this by constructing multiple homes on a single lot and subsequently subdividing them into smaller units.

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Business Plan Writers UK

Are you planning on starting or expanding a property development company and need a business plan ? Investors are likely to request a business plan or investor presentation of some kind. A vital cornerstone for property development companies, business plans give important information about how your business will be run and how it will operate while also working to secure vital funding.

Every company creates something that outlines who they are, what they plan to do and how they plan to do it. How it will be funded, what kind of properties will be acquired, marketing and everything in between, the information gives anyone who reads it a deep look into the ‘nitty gritty’ of the property development company.

Why Do I need A Business Plan For My Property Development Business?

You need one because it’s an essential document providing vital details. The information it gives isn’t just there for investors, and its purpose doesn’t just start once it’s been written.

It’s a Learning Experience

Each individual business plan is exactly that, individual. It’s a daunting thing to undertake, especially not written one before. However, discovering the best way to property development business plan together helps you gain in-depth knowledge of the industry while learning more about your own business.

You’ll also find yourself going back to your business plan frequently and amending it according to new information or new ideas. It becomes an ongoing learning experience that gives you valuable insight into the world of property development

It Ensures You Know The Business Inside And Out

When you’re forced to sit down and actually think about every aspect of your business in painstaking detail, it gives you a detailed and informed plan. People who may opt not to create business plans can have much more scattered ideas about to achieve certain things or run their business to be successful.

Writing your business plan means that not only will you have that super detailed plan, you’ll be able to answer any questions and will have a clear, focused picture of what lies ahead. It means you’ll know your business as well as you know yourself, so you’ll be in sync with it and more adaptable to change.

It Attracts Investors And Funding

The primary goal of your business plan is to attract the interest of investors and secure funding for your business. Property development takes quite a bit of start-up money and it can be a while until you see any profit, so funding and investors can be a necessity.

It also helps you to secure any loans you need, such as bank loans. If you want a business loan, you’ll usually need a business plan complete with financial data and projections so the bank can assess the risk of lending.

What Information Do I Need To Include?

There are a plethora of different things you need to portray in your business plan. There are some sections that all business plans will have, no matter what the industry, and there are some that are unique to property development.

Each business plan will be unique, with some requiring sections that others don’t, but all property development business plans should include the following comprehensive sections:

Acquisition

This includes where you plan to buy property, the price range you wish to purchase in, projected timescales, ideal exit value, construction type and planning permission status. This is a vital part of your business plan and gives you a clear strategy to move forward with.

Funding Strategy

This is the section where you need to outline how you intend to raise the capital you need to purchase properties. Without a solid funding strategy you don’t have a business, so make sure you know exactly how much loan money, personal investment and outside investment you plan on using.

Development Strategy

This is the section where you’ll need to outline exactly how you plan on conducting developments and what kind of properties you’ll be targeting. Will you be doing loft conversions? Extensions? Buying land or existing property? Will planning permission be needed?

Company Structure

This might not seem important, but it is. It should be all ready to write up as you should already know exactly what the structure of the company will be. The easiest option is to set yourself as a limited company, but there are other options available and which one is right for you will depend on your individual business. If you’re unsure or confused about your options, you can always seek professional advice on the matter.

Exit Strategy

You’ll need to think about and outline how you intend to get the money out of the property. You can either sell a developed property or rent it out. It’s an important distinction to make and your investors will want to know. Whether you buy to sell or buy to let will have tax ramifications as well, so make sure you’ve thought it through and have outlined your reasoning.

Arguably the most important aspect of your business, this section outlines your financial projections. Expressed as a percentage and not as a figure, your projected profit margins should cover the amount of profit compared to revenue, the amount of profit compared to cost and your return on investment.

If you’re not sure how to calculate this, you can do some research about how profitability is assessed in property development.

Sales And Marketing

With more and more people going away from the traditional routes of simply using an agent, there are a long list of alternative methods of selling and marketing for you to consider. Do some research about marketing innovations within the industry and discuss any social media, pay per click or any other strategies you have in mind.

SWOT Analysis

SWOT stands for strengths, weaknesses, opportunities and threats. This section is especially important if you want to secure external funding for your business from banks or investors. Make lists of each of the four pillars of SWOT, including costs of materials, current market values, projections, competitors and anything else you can think of that is applicable.

Even if you’re not looking to secure funding for your property development business, it’s still a good idea to do one for your own information. It gives you a bigger picture of the risks involved and you can tailor the rest of your strategy to account for key weaknesses or threats.

Either somewhere near the beginning or end of your business plan, preferably not in the middle, you should outline who will be working for the company. Who the directors are, any consultants you’ll be working with long-term and a diagram of the hierarchy should all be included.

Market Research

Market research is essential to any industry and it allows you to have a deep understanding of the market you’ll be going into. The best way to do it is to do the market research first. Look at overall data within the market, as well as more niche data sets. You can formulate an ironclad development and sales strategy this way.

How Do I Write My Business Plan for Starting a Property Development Company?

The first thing you’ll need to do is research. Each business is different, so each business plan will be different – you shouldn’t just download a template for this. It’s important. It’s personal. It needs to be written from scratch.

Research into the sections you should include, how it should be structured and how to best optimize the way it’s written are good starts. You can download a few templates to give you an idea, but don’t copy them directly.

Once you know what the individual sections of your business plan will be, it’s time to think long and hard about your business.

You’ll need to do some further research into best marketing practices and other areas of your business. Think about what you want to achieve as a company, what you stand for and who you want to be, and translate that into what will work best to help you achieve your goals.

Keep it neat and organized but don’t over-format it. A bunch of different font types, sizes and colours is only going to draw attention away from the content itself – so keep it simple.

Use graphs and visual aids in your document when necessary, and have these professionally created. You can use the help of a graphic designer or, if you have the skills yourself, you can use editing software to create professional-looking graphs. Excel graphs are functional, but they don’t have the same appeal.

Your business plan is important, so don’t cut corners when it comes to putting it together. Do your research, try your best and ask for help from professionals if you need it. Make sure you know exactly what you want to achieve and how before you sit down to get started and you’ll soon have a picture-perfect business plan you can be proud of. If you are serious about making a go of working in this industry, then you should look to invest in a business plan.

If you find it hard to get the right kind of planning and writing down, then you should look to our team here at Business Plan Writers UK . We are experts in property development business plan writing, and can use the information and analysis we do together to help create a clear plan of action to help take your needs further and create a business plan that works.

To find out how we can help with your business plan either call us on  020 8242 1577  or complete the contact form and one of our consultants will get straight back to you.

How to write a business plan for a property development company?

property development company business plan

Creating a business plan for a property development company is an essential process for any entrepreneur. It serves as a roadmap that outlines the necessary steps to be taken to start or grow the business, the resources required, and the anticipated financial outcomes. It should be crafted with method and confidence.

This guide is designed to provide you with the tools and knowledge necessary for creating a property development company business plan, covering why it is so important both when starting up and running an established business, what should be included in your plan, how it should be structured, what tools should be used to save time and avoid errors, and other helpful tips.

We have a lot to cover, so let's get to it!

In this guide:

Why write a business plan for a property development company?

  • What information is needed to create a business plan for a property development company?
  • What goes in the financial forecast for a property development company?
  • What goes in the written part of a property development company business plan?
  • What tool can I use to write my property development company business plan?

Having a clear understanding of why you want to write a business plan for your property development company will make it simpler for you to grasp the rationale behind its structure and content. So before delving into the plan's actual details, let's take a moment to remind ourselves of the primary reasons why you'd want to create a property development company business plan.

To have a clear roadmap to grow the business

Running a small business is tough! Economic cycles bring growth and recessions, while the business landscape is ever-changing with new technologies, regulations, competitors, and consumer behaviours emerging constantly.

In such a dynamic context, operating a business without a clear roadmap is akin to driving blindfolded: it's risky, to say the least. That's why crafting a business plan for your property development company is vital to establish a successful and sustainable venture.

To create an effective business plan, you'll need to assess your current position (if you're already in business) and define where you want the business to be in the next three to five years.

Once you have a clear destination for your property development company, you'll have to:

  • Identify the necessary resources (human, equipment, and capital) needed to reach your goals,
  • Determine the pace at which the business needs to progress to meet its objectives as scheduled,
  • Recognize and address the potential risks you may encounter along the way.

Engaging in this process regularly proves advantageous for both startups and established companies. It empowers you to make informed decisions about resource allocation, ensuring the long-term success of your business.

To anticipate future cash flows

Regularly comparing your actual financial performance to the projections in the financial forecast of your property development company's business plan gives you the ability to monitor your business's financial health and make necessary adjustments as needed.

This practice allows you to detect potential financial issues, such as unexpected cash shortfalls before they escalate into major problems. Giving you time to find additional financing or put in place corrective measures.

Additionally, it helps you identify growth opportunities, like excess cash flow that could be allocated to launch new products and services or expand into new markets.

Staying on track with these regular comparisons enables you to make well-informed decisions about the amount of financing your business might require, or the excess cash flow you can expect to generate from your main business activities.

To secure financing

Whether you are a startup or an existing business, writing a detailed property development company business plan is essential when seeking financing from banks or investors.

This makes sense given what we've just seen: financiers want to ensure you have a clear roadmap and visibility on your future cash flows.

Banks will use the information included in the plan to assess your borrowing capacity (how much debt your business can support) and your ability to repay the loan before deciding whether they will extend credit to your business and on what terms.

Similarly, investors will review your plan carefully to assess if their investment can generate an attractive return on investment.

To do so, they will be looking for evidence that your property development company has the potential for healthy growth, profitability, and cash flow generation over time.

Now that you understand why it is important to create a business plan for a property development company, let's take a look at what information is needed to create one.

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Information needed to create a business plan for a property development company

You need the right data in order to project sales, investments and costs accurately in the financial forecast of your property development company business plan.

Below, we'll cover three key pieces of information you should gather before drafting your business plan.

Carrying out market research for a property development company

As you consider writing your business plan for a property development company, conducting market research becomes a vital step to ensure accurate and realistic financial projections.

Market research provides valuable insights into your target customer base, competitors, pricing strategies, and other key factors that can significantly impact the commercial success of your business.

Through this research, you may uncover trends that could influence your property development company.

You may discover that potential buyers are increasingly interested in energy-efficient homes, or that they could be more likely to prioritize convenience and smart home features. These trends could potentially be revealed through market research for your property development company.

Such market trends play a significant role in forecasting revenue, as they offer valuable data about potential customers' spending habits and preferences.

By incorporating these findings into your financial projections, you can present investors with more accurate information, helping them make informed decisions about investing in your property development company.

Developing the sales and marketing plan for a property development company

As you embark on creating your property development company business plan, it is crucial to budget sales and marketing expenses beforehand.

A well-defined sales and marketing plan should include precise projections of the actions required to acquire and retain customers. It will also outline the necessary workforce to execute these initiatives and the budget required for promotions, advertising, and other marketing efforts.

This approach ensures that the appropriate amount of resources is allocated to these activities, aligning with the sales and growth objectives outlined in your business plan.

The staffing and capital expenditure requirements of a property development company

Whether you are starting or expanding a property development company, it is important to have a clear plan for recruitment and capital expenditures (investment in equipment and real estate) in order to ensure the success of the business.

Both the recruitment and investment plans need to be coherent with the timing and level of growth planned in your forecast, and require appropriate funding.

A property development company might incur staffing costs such as wages for builders, architects, engineers, and project managers, as well as administrative staff, to ensure the property development process runs smoothly. Equipment costs could include a fleet of vehicles for transportation, excavation and building equipment, computers and software for planning and design, and furniture for office spaces.

In order to create a realistic financial forecast, you will also need to consider the other operating expenses associated with running the business on a day-to-day basis (insurance, bookkeeping, etc.). 

Once you have all the necessary information to create a business plan for your property development company, it is time to start creating your financial forecast.

What goes into your property development company's financial forecast?

The objective of the financial forecast of your property development company's business plan is to show the growth, profitability, funding requirements, and cash generation potential of your business over the next 3 to 5 years.

The four key outputs of a financial forecast for a property development company are:

  • The profit and loss (P&L) statement ,
  • The projected balance sheet ,
  • The cash flow forecast ,
  • And the sources and uses table .

Let's look at each of these in a bit more detail.

The projected P&L statement

Your property development company forecasted P&L statement enables the reader of your business plan to get an idea of how much revenue and profits your business is expected to make in the near future.

forecasted profit and loss statement in a property development company business plan

Ideally, your reader will want to see:

  • Growth above the inflation level
  • Expanding profit margins
  • Positive net profit throughout the plan

Expectations for an established property development company will of course be different than for a startup. Existing businesses which have reached their cruising altitude might have slower growth and higher margins than ventures just being started.

The projected balance sheet of your property development company

Your property development company's forecasted balance sheet enables the reader of your plan to assess your financial structure, working capital, and investment policy.

It is composed of three types of elements: assets, liabilities and equity:

  • Assets: represent what the business owns and uses to produce cash flows. It includes resources such as cash, equipment, and accounts receivable (money owed by clients).
  • Liabilities: represent funds advanced to the business by lenders and other creditors. It includes items such as accounts payable (money owed to suppliers), taxes due and loans.
  • Equity: is the combination of what has been invested by the business owners and the cumulative profits and losses generated by the business to date (which are called retained earnings). Equity is a proxy for the value of the owner's stake in the business.

example of forecasted balance sheet in a property development company business plan

Your property development company's balance sheet will usually be analyzed in conjunction with the other financial statements included in your forecast.

Two key points of focus will be:

  • Your property development company's liquidity: does your business have sufficient cash and short-term assets to pay what it owes over the next 12 months?
  • And its solvency: does your business have the capacity to repay its debt over the medium-term?

The projected cash flow statement

A cash flow forecast for a property development company shows how much cash the business is projected to generate or consume.

example of cash flow forecast in a property development company business plan

The cash flow statement is divided into 3 main areas:

  • The operating cash flow shows how much cash is generated or consumed by the operations (running the business)
  • The investing cash flow shows how much cash is being invested in capital expenditure (equipment, real estate, etc.)
  • The financing cash flow shows how much cash is raised or distributed to investors and lenders

Looking at the cash flow forecast helps you to ensure that your business has enough cash to keep running, and can help you anticipate potential cash shortfalls.

It is also a best practice to include a monthly cash flow statement in the appendices of your property development company business plan so that the readers can view the impact of seasonality on your business cash position and generation.

The initial financing plan

The initial financing plan - also called a sources and uses table - is an important tool when starting a property development company.

It shows where the money needed to set up the business will come from (sources) and how it will be allocated (uses).

initial financing plan in a property development company business plan

Having this table helps understand what costs are involved in setting up the property development company, how the risks are distributed between the shareholders and the lenders, and what will be the starting cash position (which needs to be sufficient to sustain operations until the business breaks even).

Now that the financial forecast of a property development company business plan is understood, let's focus on what goes into the written part of the plan.

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The written part of a property development company business plan

The written part of a property development company business plan plays a key role: it lays out the plan of action you intend to execute to seize the commercial opportunity you've identified on the market and provides the context needed for the reader to decide if they believe your plan to be achievable and your financial forecast to be realistic.

The written part of a property development company business plan is composed of 7 main sections:

  • The executive summary
  • The presentation of the company
  • The products and services
  • The market analysis
  • The strategy
  • The operations
  • The financial plan

Let's go through the content of each section in more detail!

1. The executive summary

The executive summary, the first section of your property development company's business plan, serves as an inviting snapshot of your entire plan, leaving readers eager to know more about your business.

To compose an effective executive summary, start with a concise introduction of your business, covering its name, concept, location, history, and unique aspects. Share insights about the services or products you intend to offer and your target customer base.

Subsequently, provide an overview of your property development company's addressable market, highlighting current trends and potential growth opportunities.

Then, present a summary of critical financial figures, such as projected revenues, profits, and cash flows.

You should then include a summary of your key financial figures such as projected revenues, profits, and cash flows.

Lastly, address any funding needs in the "ask" section of your executive summary.

2. The presentation of the company

In your property development company business plan, the second section should focus on the structure and ownership, location, and management team of your company.

In the structure and ownership part, you'll provide an overview of the business's legal structure, details about the owners, and their respective investments and ownership shares. This clarity is crucial, especially if you're seeking financing, as it helps the reader understand which legal entity will receive the funds and who controls the business.

Moving on to the location part, you'll offer an overview of the company's premises and their surroundings. Explain why this particular location is of interest, highlighting factors like catchment area, accessibility, and nearby amenities.

When describing the location of your property development company, you could highlight the benefits of the area's economic potential. You might point out the area's access to transportation hubs, as well as potential for growth in local businesses. You could also emphasize the potential for strong returns on investment, given the area's potential for growth and development. Additionally, the area could offer a diverse array of amenities and activities that could attract potential buyers and renters. Finally, you could point out the area's potential for further growth, emphasizing the potential for long-term returns.

Finally, you should introduce your management team. Describe each member's role, background, and experience.

Don't forget to emphasize any past successes achieved by the management team and how long they've been working together. Demonstrating their track record and teamwork will help potential lenders or investors gain confidence in their leadership and ability to execute the business plan.

3. The products and services section

The products and services section of your business plan should include a detailed description of the offerings that your company provides to its customers. 

For example, your property development company might offer services such as construction, remodeling, and interior design. Construction services could include the building of new homes, garages, and other structures, while remodeling services could include the renovation of existing homes, kitchens, or bathrooms. Interior design services could help customers choose the right furniture, colors, and style to fit their needs. These services could help customers create their dream home or improve an existing property.

When drafting this section, you should be precise about the categories of products or services you sell, the types of customers you are targeting and how customers can buy them.

4. The market analysis

When presenting your market analysis in your property development company business plan, you should detail the customers' demographics and segmentation, target market, competition, barriers to entry, and any regulations that may apply.

The goal of this section is to help the reader understand how big and attractive your market is, and demonstrate that you have a solid understanding of the industry.

You should start with the demographics and segmentation subsection, which gives an overview of the addressable market for your property development company, the main trends in the marketplace, and introduces the different customer segments and their preferences in terms of purchasing habits and budgets.

The target market section should follow and zoom on the customer segments your property development company is targeting, and explain how your products and services meet the specific needs of these customers.

For example, your target market might include young professionals looking to purchase their first property. These customers are likely to be aged between 25-35, have a steady income, and are looking for a good quality property at an affordable price. They may be looking to invest in a property development project with a potential to increase in value over time.

Then comes the competition subsection, where you should introduce your main competitors and explain what differentiates you from them.

Finally, you should finish your market analysis by giving an overview of the main regulations applicable to your property development company.

5. The strategy section

When writing the strategy section of a business plan for your property development company, it is essential to include information about your competitive edge, pricing strategy, sales & marketing plan, milestones, and risks and mitigants.

The competitive edge subsection should explain what sets your company apart from its competitors. This part is especially key if you are writing the business plan of a startup, as you have to make a name for yourself in the marketplace against established players.

The pricing strategy subsection should demonstrate how you intend to remain profitable while still offering competitive prices to your customers.

The sales & marketing plan should outline how you intend to reach out and acquire new customers, as well as retain existing ones with loyalty programs or special offers. 

The milestones subsection should outline what your company has achieved to date, and its main objectives for the years to come - along with dates so that everyone involved has clear expectations of when progress can be expected.

The risks and mitigants subsection should list the main risks that jeopardize the execution of your plan and explain what measures you have taken to minimize these. This is essential in order for investors or lenders to feel secure in investing in your venture.

Your property development company could face a number of risks. For example, there may be a risk of a downturn in the housing market, which could reduce demand for the properties you develop. Additionally, there could be a risk of unexpected costs arising during the development process, which might mean that projects cannot be completed as originally planned.

6. The operations section

In your business plan, it's also essential to provide a detailed overview of the operations of your property development company.

Start by covering your team, highlighting key roles and your recruitment plan to support the expected growth. Outline the qualifications and experience required for each role and your intended recruitment methods, whether through job boards, referrals, or headhunters.

Next, clearly state your property development company's operating hours, allowing the reader to assess staffing levels adequately. Additionally, mention any plans for varying opening times during peak seasons and how you'll handle customer queries outside normal operating hours.

Then, shift your focus to the key assets and intellectual property (IP) necessary for your business. If you rely on licenses, trademarks, physical structures like equipment or property, or lease agreements, make sure to include them in this section.

You could have physical assets such as land or buildings that the property development company may own. Additionally, the company might have intellectual property like brand names, logos, or trademarks associated with the company. These could be used to distinguish the company’s services and products from its competitors.

Lastly, include a list of suppliers you plan to work with, detailing their services and main commercial terms, such as price, payment terms, and contract duration. Investors are interested in understanding why you've chosen specific suppliers, which may be due to higher-quality products or established relationships from previous ventures.

7. The presentation of the financial plan

The financial plan section is where we will present the financial forecast we talked about earlier in this guide.

Now that you have a clear idea of what goes in your property development company business plan, let's look at the solutions you can use to draft yours.

What tool should I use to write my property development company's business plan?

In this section, we will be reviewing the two main solutions for creating a property development company business plan:

  • Using specialized online business plan software,
  • Outsourcing the plan to the business plan writer.

Using an online business plan software for your property development company's business plan

The modern and most efficient way to write a property development company business plan is to use business plan software .

There are several advantages to using specialized software:

  • You can easily create your financial forecast by letting the software take care of the financial calculations for you without errors
  • You are guided through the writing process by detailed instructions and examples for each part of the plan
  • You can access a library of dozens of complete business plan samples and templates for inspiration
  • You get a professional business plan, formatted and ready to be sent to your bank or investors
  • You can easily track your actual financial performance against your financial forecast
  • You can create scenarios to stress test your forecast's main assumptions
  • You can easily update your forecast as time goes by to maintain visibility on future cash flows
  • You have a friendly support team on standby to assist you when you are stuck

If you're interested in using this type of solution, you can try The Business Plan Shop for free by signing up here .

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Hiring a business plan writer to write your property development company's business plan

Outsourcing your property development company business plan to a business plan writer can also be a viable option.

Business plan writers are experienced in writing business plans and adept at creating financial forecasts without errors. Furthermore, hiring a consultant can save you time and allow you to focus on the day-to-day operations of your business.

However, hiring business plan writers is expensive as you are paying for the software used by the consultant, plus their time, and their profit margin of course.

From experience, you need to budget at least £1.5k ($2.0k) excluding tax for a complete business plan, more if you need to make changes after the initial version (which happens frequently after the initial meetings with lenders or investors).

You also need to be careful when seeking investment. Investors want their money to be used to grow the business, not spent on consulting fees. Therefore, the amount you spend on business plan writing services (and other consulting services such as legal services) needs to be negligible relative to the amount raised.

The other drawback is that you usually don't own the business plan itself: you just get the output, while the actual document is saved in the consultant's business plan software - which makes it difficult to maintain the document up to date without hiring the consultant on a retainer.

For these reasons, outsourcing the property development company business plan to a business plan writer should be considered carefully, weighing both the advantages and disadvantages of hiring outside help.

Ultimately, it may be the right decision for some businesses, while others may find it beneficial to write their business plan using online software.

Why not create your property development company's business plan using Word or Excel?

Using Microsoft Excel and Word (or their Google, Apple, or open-source equivalents) to write a property development company business plan is a terrible idea.

For starters, creating an accurate and error-free financial forecast on Excel (or any spreadsheet) is very technical and requires both a strong grasp of accounting principles and solid skills in financial modelling.

As a result, it is unlikely anyone will trust your numbers unless - like us at The Business Plan Shop - you hold a degree in finance and accounting and have significant financial modelling experience in your past.

The second reason is that it is inefficient. Building forecasts on spreadsheets was the only option in the 1990s and early 2000s, nowadays technology has advanced and software can do it much faster and much more accurately.

And with the rise of AI, software is also becoming smarter at helping us detect mistakes in our forecasts and helping us analyse the numbers to make better decisions.

Also, using software makes it easy to compare actuals vs. forecasts and maintain our forecasts up to date to maintain visibility on future cash flows - as we discussed earlier in this guide - whereas this is a pain to do with a spreadsheet.

That's for the forecast, but what about the written part of my property development company business plan?

This part is less error-prone, but here also software brings tremendous gains in productivity:

  • Word processors don't include instructions and examples for each part of your business plan
  • Word processors don't update your numbers automatically when they change in your forecast
  • Word processors don't handle the formatting for you

Overall, while Word or Excel may be viable options for creating a property development company business plan for some entrepreneurs, it is by far not the best or most efficient solution.

  • Having an up-to-date business plan is key to maintaining visibility on your future cash flows.
  • A business plan has 2 parts: a financial forecast highlighting the expected growth, profitability and cash generation of the business; and a written part which provides the context needed to interpret and assess the quality of the forecast.
  • Using business plan software is the modern way of writing and maintaining business plans.

We hope that this guide helped you to better understand how to write the business plan for a property development company. If you still have questions, do not hesitate to contact us.

Also on The Business Plan Shop

  • How to write a 5 years business plan
  • Business plan myths

Know someone who owns or wants to start a property development company? Share this article with them!

Guillaume Le Brouster

Founder & CEO at The Business Plan Shop Ltd

Guillaume Le Brouster is a seasoned entrepreneur and financier.

Guillaume has been an entrepreneur for more than a decade and has first-hand experience of starting, running, and growing a successful business.

Prior to being a business owner, Guillaume worked in investment banking and private equity, where he spent most of his time creating complex financial forecasts, writing business plans, and analysing financial statements to make financing and investment decisions.

Guillaume holds a Master's Degree in Finance from ESCP Business School and a Bachelor of Science in Business & Management from Paris Dauphine University.

Page last updated on 06 Dec 2023 , as per our editorial standards (originally published on 24 Nov 2023 ).

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  • A Step-by-Step Guide to Writing a Rental Property Business Plan

If you’re planning on buying rental property, you’re going to need a business plan.

While this, admittedly, sounds incredibly dull and complex, creating a business plan can often separate the best real estate investors from the rest.

Although it may be tempting to dive right in and start earning your (hopeful) millions right away, a rental property business plan can massively increase your chances of success and help you make the right decisions.

And the best part? It doesn’t have to be complicated. By reading this article, you can find out how to build the perfect rental property business plan in just six simple steps.

Topics on this page include:

  • Buy to let business plan example
  • How to write a rental property business plan
  • How to pick the right area for an investment

We’ve also created a downloadable (and completely free) property business plan template. All you need to do is fill out your details in the sign-up form below for instant access!

Without further ado, let’s find out how to write a plan to start building a rental property business.

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  • What Is a Property Business Plan and What Does it Consist of?

Before you make any decisions, let’s quickly explain what a property investment business plan consists of, and why you should spend the time making one.

Simply put, a rental property business plan outlines what you hope to achieve with your venture.

It doesn’t have to be a 30-minute PowerPoint presentation or a 1,000-word essay. In fact, the most effective business plans are simple, concise, and easy to commit to memory.

To make an effective one, there are three central aspects to make an ideal rental business plan.

You’ll need to think about:

  • Where you are now – this includes your available finances and how much money you’re willing to spend.
  • Your goals – think about where you want to get to, which can include an accurate financial goal to help you achieve specific dreams.
  • Your chosen strategy – by picking the right strategy that aligns with your goals, you’ll be able to bridge the gap between your current situation and your dream after real estate investing.

We’ll discuss each of these, plus two effective tips, in the following five sections.

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  • Step 1: Assess Your Starting Point 

Every journey has a start point, and knowing yours will help determine exactly what sort of rental property investment you’re aiming for.

To complete this step, there are a few questions you need to honestly ask yourself.

  • How much money do you have to invest?
  • How much time do you have available to manage your property?
  • Do you have the needed skills and knowledge to be an effective landlord?

The first point is likely the most important: Can you afford this investment?

This includes assessing your available funds, thinking about how much you’re willing to spend, and working out how you will pay for your investment.

The reality is property can be expensive, surpassing over £285k in March 2023, which was £11,000 higher than in 2022.

In our blog post,  how much money do you need to invest in property , we calculated that you’ll need about £30k as a minimum to buy a property worth £100k, which is on the lower end of the spectrum.

That’s not to mention the ongoing costs you’ll likely need to contend with, including potential ground rent, property management costs, maintenance costs, and mortgage payments.

Be sure to speak to a mortgage broker to determine what sort of finances you have available, and ensure you set some money aside (six months’ wages is recommended) in an emergency fund to help you enter your first property investment with a better sense of financial security.

With a clear view of your finances in order, you can start accurately assessing opportunities on the property market and start fleshing out your rental property business plan.

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  • Step 2: Think About Your Goals 

Once you know what you’re starting with as an investor in terms of budget and knowledge base, the next step of your property business plan should look at your goals.

Setting goals is an essential part of any property journey as it allows you to outline the reasons why you’re investing and paint a clear picture of what you hope to achieve.

It goes without saying that the main reason that a lot of people invest is to make money, but it’s important to look a little deeper than that for your investment property business plan.

When creating a property business plan, the most common investment goals are as follows:

  • Saving an attractive retirement fund.
  • Saving money for life events.
  • Increasing disposable income and passive income for financial freedom.

But while having these goals in mind is important, the best way to develop your rental property business plan is to put actual numbers behind each goal.

Instead of saying, “I want to have more money each month to fund my lifestyle” you should assess deeper and put a number behind this – let’s say £5k a month.

By doing this, you can accurately assess your local housing market and start building your property portfolio to see what real estate will effectively contribute to this figure.

You also should think about when you want to achieve your goals, which can have a huge impact on the type of property you choose.

Let’s go over two example properties.

  • A purpose-built student apartment in the city centre that is generating 10% annual returns through rental income but won’t grow too much in value.
  • A family home on the outskirts of a city that generates a 5% NET positive cash flow and has huge potential for further capital growth.

In these scenarios, someone hoping to increase their monthly rental income over the next three years would be more suited to the first.

However, those real estate investing for retirement funds would likely want to take the risk and wait for a long period to enjoy a huge cash payout on the family home.

Aside from the money you will have generated, think about your personal goals.

Do you want to be a skilled property professional who manages their rentals with a hands-on strategy and takes on landlord duties on a number of properties? Or do you want to own a portfolio of properties with a hands-off strategy, working with a rental/letting management company that takes care of all of the day-to-day duties?

If you have another career that you think will dominate a lot of your time and attention in the foreseeable future, your personal goals may be more fitted to an investment property business plan that allows you to juggle both your career and your investments.

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  • Step 3: Create Your Strategy 

Step three of your property venture journey is likely going to be your most important and is often the main factor that separates the most successful investors from the biggest failures.

For most people’s goals, one property simply won’t be enough, with the average UK rental income valued at £1,199 per calendar month according to the HomeLet rental index.

This is why it’s a smart idea to come up with a strategy to fulfil your long-term ambitions to flesh out your property portfolio.

You can do this in several ways.

  • You can save up your rent and reinvest the profit into a new real estate venture.
  • You can buy properties with lower property prices, at auction or off-plan, to increase your purchasing power.
  • You can flip houses, which means buying properties at a lower market value, adding value, and then quickly re-selling to boost your available cash.

By having a clear vision like this, you will avoid getting stuck in an investment that doesn’t further your goals and can instead focus your time and money on making a good investment.

Choosing a strategy can also involve specifically deciding what type of property you want to invest in.

When it comes to real estate and creating a buy-to-let business plan, there are several different strategies you can consider in your investment decisions – each being differently suited to your skillset and investment goals.

These can include:

  • Residential buy-to-let – the most standard form of buy-to-let that involves buying a flat or house and renting to a tenant. This type of property usually offers the best blend of cash flow and capital growth potential.
  • Purpose-built student accommodation – Another popular type of investment property that consists of buying a property and renting solely to student tenants. PBSA offers lower property prices and comparatively higher rent prices than traditional buy-to-let but has less capital growth potential.
  • HMOs – a house of multiple occupancies is rented out to multiple tenants, increasing potential cash flow and ROI. However, HMOs can be complex, with a tonne of legislation in place that beginner investors may find intimidating.
  • Commercial buy to let – involves the purchasing of an office block or retail space and renting to a company. Commercial properties have longer lease lengths than traditional buy-to-let, but it can be much harder for investors looking to secure financing from buy-to-let mortgages.

If you want to learn more about your options for choosing a rental property, be sure to check out our top 10 list of the best property investment strategies in 2024.

Along with the investment strategy itself, you should also think about your exit strategy.

An exit strategy outlines how and when you plan to exit your investment, which, with a property business plan, will mean selling the property.

Again, your investment goals will play a part in this decision. If you hope to generate as much money as possible for retirement, your exit strategy should look at selling the property sometime before you retire.

Spend some time researching exit strategies to better incorporate this into your buy-to-sell or buy-to-let business plan.

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  • Step 4: Action Your Buy to Let Business Plan With a To-Do List 

Now that you’ve got a business model in place and have nailed the planning process, it’s time to action your business plan.

But where to start? While it might seem daunting for many investors to action their solid plan, the best tip possible is to break down your goals into small actionable individual tasks.

Although your overall goal may be to, say, earn £5,000 a month, you’ll need a series of achievable sub-goals in place before you can reach your golden number.

These sub-goals could be anywhere from securing your first property within three months from now, finding tenants, or simply securing a mortgage broker.

By setting out these goals, you’ll have a much clearer financial plan and vision for your rental property business.

The best way to achieve these goals is to create a to-do list of every task you need to do, both one-off and recurring tasks. You should break some of these tasks into even smaller tasks so you constantly feel like you’re making progress.

For instance, let’s say you decide that you want to buy a city centre apartment for your first investment.

You should first allocate the amount of time you want to do this each day and break down your time into individual websites.

As an example, your tasks could be:

  • Search Rightmove for 20 minutes
  • Search Zoopla for 20 minutes
  • Search RWinvest for 20 minutes
  • Bookmark/favourite any properties that catch your eye.
  • Contact the estate agents/ sales agents to learn more about the properties.

With this, you’ve got a clear pathway, know exactly what you’re going to do, and can tick off each task as it’s completed. Soon enough, you will find the perfect rental property for you, and it will be well underway to create the dream property business.

It’s also important to address that not every task needs to be completed by you. In fact, while you could certainly achieve every aspect of property investment as an individual, if you don’t have the skillset, it would be a mistake not to outsource or reach out to others for help.

For example, if you have a full-time job or don’t have the necessary skills to fulfil your landlord responsibilities, you could hire a property manager. By doing this, a property manager will handle all day-to-day duties and can find tenants on your behalf.

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  • Step 5: Choose the Right Location for Your Target Tenant 

The next step in creating an ideal real estate investment group business plan is to decide on what location you’re investing in.

While many landlords fall into the trap of buying a property that’s close to where they live, this could be a mistake, with the UK rental market notorious for having huge regional variations.

These regional variations can impact every aspect of a property venture, with variations in the rent price you can charge, the purchase price of the property, rental demand, and capital growth.

You’ll want to target the best area possible and consider rental properties with the highest chance of attracting your target tenants.

For starters, let’s discuss how to evaluate if an area is worth an investment. You can do this in a few ways.

  • Research the average property price in the area – You can do this using sites like Zoopla, Rightmove, or the UK House Price Index.
  • Research the average rent in an area – This will be a good indicator of how much you can expect to charge, and you can find this on sites like Zoopla and the HomeLet rental index.
  • Look at past house price growth as an indicator of future growth potential – You can find this on the UK House Price Index, which shows average house prices every month, all the way back to 1968.
  • Think of tenant demand – This is a harder measure to find, but a good indicator is looking at how many rental properties there are in an area and the population, with lots of young people a good indicator of a strong rental market.
  • Familiarise yourself with future capital growth potential – You can achieve this by looking at the latest market predictions from experts like Savills or JLL.

Based on these criteria, the current best locations for rental property include Liverpool, Manchester, Birmingham, Leeds, and Luton. You can learn more by checking out our top 10 list of the  best places to invest in property.

If you live away from any of these areas but still want the benefits involved with starting a rental business there, you can always hire a property management company to fulfil all your landlord responsibilities.

Here at RWinvest, we have helped a huge amount of foreign investors who are looking to invest in areas like Liverpool and Manchester.

Remember, though, that you should avoid buying too many similar properties in one area, no matter how attractive it seems. This is because if a local property market tanks, you don’t want all your eggs in one basket.

To avoid this, it’s a smart idea to diversify your portfolio. You can do this by buying a mixture of student properties and residential properties, and buying them in different areas like Liverpool or Manchester.

Thinking of Your Tenant

While picking the right location is an important step in your rental property business plan, it’s not enough to guarantee a successful investment. For this, you’ll need to think about what your tenant wants from their home and pick a property that aligns with these wishes.

This is true whether you’re buying single-family homes or a city centre apartment targeting young professionals.

Covid-19 and the resulting lockdowns have changed a lot of tenant priorities, with research from Benham and Reeves finding that high-speed WiFi, outside space, and proximity to outside green space is now the top three demands from tenants.

This is significantly different to previous rankings, which saw nearby transport links, fast broadband, and onsite security as the top three.

While it’s a good idea to have a property that offers all tenant priorities, it’s essential you provide the top three desires to maximise your success potential.

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  • Step 6: Consider Forming a Limited Company 

The final step in your rental business plan is to decide if you’re going to form a limited company.

Forming a buy-to-let company has become incredibly popular over the last few years, with 2021 and 2022 breaking the record for the number of new companies set up by buy-to-let landlords.

This is for a good reason, too, with limited companies allowing some investors to save thousands on taxes by paying corporation tax instead of income tax and having access to more mortgage interest relief.

However, there are several downsides to starting a limited company, which include being taxed for taking money out of the company, no capital gains tax allowance, and difficulties securing a buy-to-let mortgage.

While forming limited companies isn’t usually beneficial for those only owning a single property, investors looking to build a property empire could see far higher profits from forming one.

You can learn more about this by reading our full guide on  buying property through a limited company.

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  • Conclusion 

We hope you’ve enjoyed this article about how to write a rental property business plan.

In summary, an effective plan is simple, has a clear intent, and is broken down into smaller tasks.

You can create a property business plan in just six steps.

  • Assess your starting point 
  • Think about your goals 
  • Create your strategy 
  • Action your buy to let business plan with a to-do list 
  • Choose the right location for your target tenant 
  • Consider forming a limited company  

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  • Take the Next Steps With RWinvest in 2024

Once you’ve created a detailed and considered property business plan, you should think about getting started with your investment and putting your business plan for buy to let into action.

The first step in actioning your investment is normally to find a property to invest in, and it’s important to focus on finding an opportunity that’s likely to bring you the highest returns possible.

That’s where RWinvest can help.

Here at RWinvest, we have a range of great investment properties in lucrative UK property investment hotspots, Liverpool and Manchester.

Offering assured yields of up to 7% and prices starting at £154,950, browsing our range of investment opportunities is a great way to put your business plan for buy to let into action.

Get in touch today for a free chat with one of our property consultants and get started with your property investment journey.

For more informative content and guides, take a look at the following suggestions:

  • The Best Way to Invest £100k 
  • The Best Places to Retire in the UK
  • Top Tips for Getting Started in Property Investment

Disclaimer

Reece Pape is a property writer at RWinvest. Reece is passionate about keeping property investors updated on must-have information and housing market news, utilising the latest property market statistics and data.

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How to become a property developer

property development business plan example uk

Written and reviewed by:

Bryn Glover - Startups

Our independent reviews are funded in part by affiliate commissions, at no extra cost to our readers.

The UK’s love affair with bricks and mortar means investing in property has always been attractive to those looking to grow their wealth, or even make it their primary business. While government regulations have undoubtedly impacted the UK housing market – making property development somewhat less attractive than in previous decades, it’s still a solid long-term investment route that can provide significant returns if done properly.

Even with the threat of a recession, plus very real crises around material supply chains and costs, plus a post-Brexit hiring struggle, there are signs that the UK property market will only continue to grow over the medium term. It's not quite crisis-proof, but it remains a surer bet than most sectors.

Forecasts from global real estate agency Savills indicate that UK house prices should rise by 13.1% over the next four years, and rents in urban areas are expected to bounce back as life returns to normal post-pandemic. Growth is expected to be spearheaded by the North of England over this period, as Northern towns and cities become increasingly attractive to young professionals.

In this guide, we'll walk you through the risks, rewards and real opportunities around becoming a property developer.

There's a huge amount of planning that needs to go into launching a property development business. Thankfully, one area which needn't cause undue stress is creating a website to promote your business. Thanks to modern templates like the one below , you can create one of your own in under an hour.

Construction Business Website Template

At Startups.co.uk, we test and rate website builder tools, and we've identified Wix as one of the best you can choose for creating a business site. Wix even has a selection of  custom website templates designed specifically for property developers  – you simply drop your own company information, wording and preferred imagery into your chosen template. Better still, it's completely  free to try  for yourself.

This property development guide will cover:

Creating a property development business plan, buy-to-let vs buy-to-sell, market research, calculating roi/rental yield, renovating for sale or rent, financing your property development, final thoughts.

At Startups.co.uk, we're here to help small UK businesses to get started, grow and succeed. We have helpful resources for helping new businesses get off the ground – you can use the tool below to get started today.

What Does Your Business Need Help With?

Whatever your intentions, you’ll need to start by coming up with a property development business plan.

To an extent, all business plans are the same – you need to set out in detail exactly what you want to do with your business, and how you are going to achieve this (as detailed in our business plan template ). If you’re producing a plan for personal use, then you won’t need to go into quite as much detail as if you want to start a full-fledged property development business and pitch to investors, but there are still certain key elements you’ll need to be clear about before you begin investing.

Start by working out the following:

  • Who is your target market?
  • What sort of properties are likely to appeal to your target market?
  • How are you going to obtain funding?
  • Expected timescales and costs for construction or renovation

Mark Homer, the co-founder of property education company Progressive Property , says that it’s essential to have the total value of your development project estimated by a bank surveyor rather than estate agents. “Cashflow is critical,” he notes. “It’s important to understand how you will be paying the bills when waiting for properties to sell.”

If you are targeting investors, make sure your plan is clear and to the point, emphasising the most important aspects. Urbane Brix Business Development Manager David Potter advises: “Include the structure of your company, your funding plans, the financial targets and returns you’re expecting to see, a construction strategy, and your market research. You want to focus on the financial targets, as this will be the eye-catcher, but your market research will show the strength and relevance of your business plan and assure your investors that their investment will pay off – putting their confidence in you.”

How has COVID-19 affected the UK property market?

COVID-19 did have a major impact on the UK property market – with lockdown slowing the whole process down and meaning buyers had to wait months before actually getting the keys.

What it did not do is stop the steady increase in UK house prices, which spiked when chancellor Rishi Sunak announced a stamp duty holiday in July 2020 . This increased demand and led to a ‘mini boom’ in house prices which is now levelling off but not actually reversing.

Longer term, the shift towards hybrid working is expected to increase demand for high quality properties, with outside spaces like gardens and balconies more prized than ever.

Over the next few years, the strongest property growth is expected to be recorded in Northern England , as the government’s levelling up agenda takes hold and transport links are improved.

Help keep your business plan in order

A business plan will include a number of steps, and it can be difficult to keep everything in order. Whether you're working alone or as part of a team, it's important that you stay organised. A project management tool can help you to do just that.

Perfect for creating workflows and visualising strategies, project management software can organise personal work or increase and improve collaboration. Here's our pick of the top project management tools:

A key decision you’ll need to make is whether you want to operate on a buy-to-let or buy-to-sell business model.

Buy to let

With buy-to-let, you’ll purchase a property in order to rent it out, using the rental payments to pay off the mortgage on that property – and provide a bit of extra profit, too.

While this may sound attractive, and given the fact that the rapid rise in UK house prices has created a huge market for attractive rental properties in towns and cities, you will ultimately be responsible for the maintenance of the property – including arranging for repairs, ensuring that things like the smoke detector and boiler are regularly inspected, and potentially even finding tenants and checking their references and credit scores. A letting agency will take care of much of this work for you, but obviously will charge for these services, cutting into your profit.

Buy-to-let is a great way to provide a long-term income stream, but it’s not an easy way to make a quick buck – you’ll need to be dedicated, and always recognise that the needs of your tenants are paramount (they are providing your income after all). You may also need to plan for void periods, as it’s likely the flat will sometimes sit empty while you’re in the process of finding a new tenant.

Buy-to-sell

Buy to sell

With buy-to-sell (also known as property flipping), you’ll buy a property, hold it for a short time, and then sell it on again. For this strategy to be successful, you’ll generally need to buy a property that needs work, whether that’s upgrading the interior or converting the attic into an extra bedroom. You then make the necessary renovations and sell for a profit, making sure to factor in the costs of the work. The more work required, the larger the risk, and the bigger the potential profit – but it’s a good idea to start off with somewhere small to get your head around the process.

Staying on top of costs during renovation/construction is crucial, so make sure you set out a detailed plan before you start, and include some leeway (at least 10%). A project coming in under budget is almost unheard of – the majority cost more than initially expected.

Your contacts will be vital, so make sure you have a “black book” of builders, plasterers, architects, and electricians that you can trust to do a good job. Alternatively, you can try to do some jobs yourself to keep costs down. The upside of this model is that if you do sell at a profit, you’ll get a lump sum that you can then use on your next project, making this a much quicker way to build a property portfolio.

It’s also important to note that you may shift from one model to another, eventually selling a property after renting it out for a few years for example, or using the profits from a buy-to-sell property to invest in a buy-to-let property.

Your approach might also change depending on the market environment, so flexibility is crucial.

Bruce Burkitt, the Managing Director of residential property investment company Property Experts , recommends planning an exit strategy. “If the primary plan is to resell the home, then budget to sell the home for 10% less than today’s market value, as it is a difficult market.

“In this way, if the prices drop, there is a buffer for the investment – but if it sells for more, then it’s a pleasant surprise. However, in the event that prices slide away and the property does not sell, investors should ensure that there is finance in place to take out a buy-to-let mortgage on the property, and that rental values will cover mortgage repayments by at least 150%.”

Whichever route you choose, doing thorough research is crucial.

Key takeaways

  • Buy-to-let is a great way to get long-term income
  • Buy-to-sell is a quick way to build a property portfolio
  • You may need to combine both models

Before spending a single penny, you’ll need to do your sums and know exactly what the situation is in your chosen area. You’ll need to know what buyer/renters in that area are looking for, and how much you can afford to pay for a property.

Location, Location, Location

It’s such a cliche that it’s even the name of one of the UK’s biggest property TV programmes, but picking the right location is a huge part of successful property development. However, this doesn’t mean you should always buy in the best part of town – whether you want to rent out or sell your property, chances are prices will already be near their peak, and the value of your property won’t significantly increase. Instead, the key is to find areas just before they get hot and house prices soar.

Look for locations on the fringes of popular parts of towns and cities, as the wave of gentrification is likely to spread out as people are priced out of the hottest areas. Property sites like Rightmove have easily searchable data on the prices of sold houses in different areas.

Always put yourself in the mind of your target market. Transport links are vital; young professionals and students will want bars and restaurants on their doorstep, while families will want a safe environment with good schools.

Make sure you get to know the local estate agents, as they will know what buyers and renters in an area are looking for. Check in regularly to build up personal relationships that mean you’ll be the first to know when new properties go on the market which may suit your requirements.

If you’re looking for buy-to-let properties, then university cities are a great option, with Urbane Brix’s David Potter noting that areas close to universities tend to be a sound investment: “With student numbers increasing, the need for student accommodation is at an all-time high, and this is giving investors good returns that are often guaranteed for three to five years.”

Also make sure you consider less conventional property sales. Paul Wheatcroft, Property & Mortgage specialist at My Local Mortgage , advises: “Auctions are a good way of finding real value for property investment – just make sure you’re aware of the process and potential pitfalls.” Particularly important is the fact that in property auctions, “a deposit is payable on the day for any property, and this deposit is not refundable if things fall through for some reason.”  Repossessions are another option, and while “these are less common than five to 10 years ago, they offer similar value to auctions.” Being aware of such sales is another benefit of having good relationships with local estate agents.

Expert Insight – Jonathan Rolande, House Buy Fast

The director of professional property buyers House Buy Fast , Jonathan Rolande has decades of experience in the property industry and says that navigating a hugely competitive is a big challenge for aspirant property developers:

“It's not an easy market to operate in right now. Prices have been increasing so quickly, there is a lot of competition for every property, especially at the lower price levels. It's all about building good relationships and being able to move fast when needed – so it's vital to have a great team for finance, surveys, legal issues and more.

The good news for sellers is that all the signs are there are plenty of buyers for every property and prices holding firm for now so it is still a great time to sell.”

However, he warns that there could be trouble ahead in the short term.

“There’s no doubt that mortgages will become more expensive and harder to obtain in the coming months as interest rates look set to rise and the cost of living crisis forces lenders to look more closely at personal outgoings when calculating affordability. The majority of homeowners are already at a fixed rate so the immediate effects will be felt by new buyers.”

ROI and rental yield

In any business, ROI (Return on Investment) is crucial, as it’s the only way you’ll know whether a particular project has made a profit or loss. And property development is no different – you’ll need to make sure you get your maths right, and know exactly what needs to be considered in terms of costs.

Buy-to-sell ROI

On paper at least, working out a buy-to-sell ROI is simple. It’s your sale price minus (purchase price plus costs) .

Depending on your financing, the purchase price may be more complex than it sounds, as you should only use the money that you’ve actually put up – which, in most cases, will be the deposit on the loan or buy-to-sell mortgage (a conventional mortgage is unlikely to be suitable for a buy-to-sell property). Of course, you will also need to pay back the loan amount when you sell, so include this in your calculations, and make sure that the property will increase in value enough to leave you a decent profit after you’ve repaid your loan or mortgage.

The really tricky bit is working out your costs. The bulk of this total will be the money you spend on renovating or refurbishing the property, but you also need to consider the costs of arranging finance, any loan/mortgage repayments, survey fees, solicitor fees, estate agent fees, and smaller costs like insurance, utility bills, and council tax.

You’ll also need to consider the tax implications.

Buy-to-let ROI (Rental yield)

While buy-to-let ROI is not fundamentally different from buy-to-sell ROI, it is a little more complex, as you’ll need to work out your rental yield (the annual return on your rental property). In its basic form, this is relatively simple:

Total annual rent divided by purchase price

Let’s start with the easy bit. To work out your annual rent, multiply your monthly rent by 12 .

So, let’s say you rent out your property for £1,250 a month – the annual rent would be £1,250 multiplied by 12, which equals £15,000

You then divide this by the amount you bought the property for – let’s say £400,000 in this hypothetical example.

£15,000 divided by £400,000 equals 0.0375

To convert this to a percentage, multiply it by 100.

0.0375 multiplied by 100 equals 3.75

So in this example, your basic rental yield is 3.75%.

Unfortunately, things are a bit more complicated in the real world, as you’ll need to consider buying costs (i.e. agent fees, survey costs, and other expenses), plus the costs of both arranging and paying for a buy-to-let mortgage or other similar financing.

The basic formula is as follows:

First, add together your deposit and buying costs , as you’ll need that combined figure for the next bit.

Now, use this calculation:

(Annual mortgage cost minus annual rent) divided by (deposit plus buying costs)

To properly explain this, let’s return to our hypothetical example.

If we use the same example as before, the purchase price was £400,000. A buy-to-let mortgage is commonly offered on the basis of a 25% deposit, so your deposit would be 25% of £400,000. The easiest way to work this out is to multiply £400,000 by 0.25.

£400,000 multiplied by 0.25 equals £100,000

So, your deposit would be £100,000.

Buying costs vary, but for a £400,000 property, around £3,000 is reasonable.

So, the total of your deposit and buying costs is £100,000 plus £3,000, which is £103,000.

Now, we need to work out the cost of the mortgage. Buy-to-let mortgages are most commonly offered on an interest-only basis, where you only pay the interest on the amount loaned rather than paying back the amount loaned itself.

If the interest was 5%, then the total cost of the mortgage would be 5% of the loan amount. Remember you put up 25% as a deposit, so the loan amount would be £300,000 (75% of £400,000).

You now need to work out 5% of £400,000. The easiest way to do this is to multiply £400,000 by 0.05.

£400,000 multiplied by 0.05 equals £20,000

To work out the annual cost of your mortgage, you’ll need to divide this amount by the number of years your mortgage covers . We’ll say 2 years in this example, so the annual cost would be £20,000 divided by 2, which is £10,000.

You now have all the elements for a good idea of your annual return – in other words, the profitability of the project.

Again, this is the formula:

In our example, the annual mortgage cost is £10,000

The annual rent is £15,000 (£1,250 multiplied by 12)

The difference between these is £5,000 (£15,000 minus £10,000)

The deposit + buying costs total is £103,000

So, finally, divide £5,000 by £103,000

This equals 0.0485

Multiply this by 100 for the percentage, and you get 4.85%…

…which we’ll round up to 4.9%.

While this might seem a reasonable annual return, you also need to consider tax, maintenance costs, letting agent fees, and other expenses, all of which will eat into your profit.

The calculation above also assumes that the property will be rented for all 12 months every year, but in reality, you’ll also need to budget for void periods when it’s empty and no money is coming in.

If you’re going to make the economics of buy-to-let work, it’s absolutely crucial to work out what you need to charge in rent, and what you can afford to pay for a property.

  • Buy-to-sell ROI = sale price – (purchase price+costs)
  • Buy-to-let rental yield = (Annual mortgage cost minus annual rent) divided by (deposit plus buying costs)
  • For buy-to-sell, you also need to consider the cost of renovation
  • For buy-to-let, factor in tax, maintenance costs, letting agent fees, and void periods

The importance of timing

They say the secret of great comedy is timing, and the same can be said for great property development. When looking for an investment property, you’ll need to stay calm and do your research properly. Look at sold prices in the areas you’re looking at, and work out the floor and ceiling price for the sort of property you’re searching for – e.g. a two-bed terrace house or one-bed flat. Next, work out what is driving the difference between floor and ceiling values – is it the condition of the interior, transport links, proximity of good schools, being just off the buzzing high street, or some other factor?

You also need to use the same forensic eye when choosing an area to invest in. It’s often a good idea to start off relatively close to home as you’ll have a good knowledge of the local area, but you may need to venture further afield in order to find a location with strong growth potential. Look for an area where properties sell quickly and construction or investment activity is occurring, as these are both great signs of somewhere on the up.

Finally, don’t let estate agents rush you into a purchase before you’ve done your research. While they can be a great resource, at the end of the day, they are trying to sell properties as quickly as possible for as much money as possible. Stay strong if they try to pressure you into a quick decision. It’s much better to miss out on a property than overlook a serious problem, and end up with a money pit that no one wants to buy or rent.

However, while you should take your time choosing, once you’ve found a property that ticks the right boxes, you’ll need to act quickly to secure it. Property markets in popular areas move rapidly, and you’ll need to be decisive in order to secure your investment property. Don’t overpay, though – set a budget and stick to it. If someone else pays more, they may have advantages you don’t (being a skilled tradesperson for example), or may simply be more optimistic about the property market in that area.

Many experienced property investors live by the adage that “you never regret the deals you don’t do”. Remember this when you miss out on a property.

Property renovation

Speed is also of the essence when renovating – the quicker you can fix up a property, the quicker you can get it back on the market and making money. However, don’t be hasty and don’t cut corners – potential buyers or renters will be put off by rough edges or a poor-quality finish. When doing up a property, always bear in mind the following points:

Consider your ideal buyer or renter

If there’s a golden rule of property development, it’s this – it’s not about you. Every decision you make should be based on ending up with a property that’s going to appeal to as many people as possible.

As veteran property investor and chair of Women in Property Mandy St John Davey notes, “Do not be tempted to over personalise an investment property, and make sure to keep your business head firmly screwed on.” Be particularly careful about using too much colour – one person’s bright and bold is another person’s garish, and while magnolia walls may be dull, they make rooms feel bigger and present a blank canvas that can be customised by whoever buys or rents your property.

It’s equally important not to blow the budget on fixtures and fittings, especially if you’re investing in a mid-priced area. Always bear your target audience in mind, and think about what they would expect. Student renters may not need, appreciate, or want to pay for a swanky bathroom suite, while young professionals may be willing to pay a premium for a stylish and elegant property. Area will always be a huge influence on price though, so check property sites to see what’s selling, and to learn more about what sort of interior is found in higher priced properties.

Stay on schedule

When renovating a property, your key skill will be project management, ensuring that you know when and how each element of the renovation is being tackled, and how much it will cost.

To ensure you can keep track of every little detail and won’t incur the added expense of having to change things during the renovation, Progressive Property co-founder Mark Homer recommends producing a detailed specification sheet that sets out what needs to be changed in each room, what needs to be replaced, what needs to be inspected/tested, and what should be left alone entirely.

You can also take advantage of some of the great project management tools listed below, which make it easy to get an overview of the project, make notes, update progress, and issue instructions on the go.

The bare necessities

Even if you’re not renting to Baloo the Bear, there are still some things that everybody will expect from a rented or purchased home, and will cause plenty of worries and strife if you don’t get them right. These include:

Until it goes wrong, you won’t appreciate quite how much your boiler does for you. It heats the home, provides hot water for your morning shower, and even pulls its weight in the kitchen too (just try washing up without hot water).

They come in all shapes and sizes, but make sure you do your research carefully – not all boilers are suitable for all properties. The right choice for yours will depend on where it will be stored, the requirements/size of the property, and the existing pipework. Make sure you consider all relevant factors when choosing a boiler for your renovation project.

  • Home security

No matter who buys or rents your property, feeling safe in their own home is likely to rank pretty high on their list of priorities, so make sure this is a key area of emphasis.

This is even more important for a buy-to-let property, as it’s the landlord’s legal responsibility to make sure any rental property meets basic security needs, including doors and windows that can be closed properly and locked. Any money you invest in home security will also reduce your insurance premiums, and while there’s no legal requirement for landlords to have insurance in place, your buy-to-let mortgage provider may require you to take out a policy.

For higher-price properties, your home security needs are likely to go way beyond lockable doors and windows. An intruder alarm should be a must, and you may also want to consider a guard response system and CCTV.

If you’re confused by the latter, then help is at hand – simply click here to start comparing the best CCTV systems and find the right one for you.

  • The kitchen

Exactly how much money you spend on the kitchen will depend on your target market, but it’s a key part of most homes, and a space that needs to be carefully planned. The minimum requirement is a clean space that functions effectively, so think about how the room is likely to be used, practical requirements like storage, and making sure the sink and any appliances are easily accessible.

Remember: it’s a landlord’s responsibility to ensure that all electrical appliances are safe at the start of each tenancy, so make sure they are regularly inspected and upgraded when necessary.

While this may be a significant expense, it will make your property more desirable to renters, and reduce the risk of fire or other problems from outdated equipment. Legally, you must also make sure your appliances are regularly checked for gas safety by a Gas Safe registered engineer , and anyone renting out an HMO (Houses in Multiple Occupation) needs to ensure PAT (Portable Appliance Testing) checks are conducted at least once every five years.

Outside space is a key consideration for many buyers and renters, so if you buy a property with a garden, make sure to maximise it. Again, your target market is key here: families with children are likely to want an unbroken expanse of green lawn, professional couples will want something easy to maintain, while students probably just want a nice place to have a drink in the sun.

Think about the movement of the sun as well – if that old shed in the corner is occupying the sunniest spot, then knocking it down and constructing a pergola could make a huge difference to the usability of the garden, and increase the desirability of your property.

  • It's not about you – always make every decision with your ideal buyer or renter in mind
  • Project management is crucial – you need to know exactly what needs to be done, how long it will take and how much it will cost
  • Get the basics right: the boiler, home security, kitchen and garden (if the property has one) are all fundamental parts of a renovation project

Our dedicated page on property development financing will tell you everything you need to know, but in the meantime, here are five basic options:

  • Cash – Unlikely to be an option when you’re starting out, but one to bear in mind when you’re further along your property development journey.
  • Buy-to-let mortgage – If you want to rent a property out after buying it, then you won’t be able to use a standard mortgage – instead, you’ll need a buy-to-let mortgage. These are generally offered on an interest-only basis, and have a larger deposit, higher interest charges, and bigger fees than a standard mortgage.
  • Buy-to-sell mortgage – Similarly, a standard mortgage won’t be suitable for those planning to buy, renovate, and then sell on a property. A buy-to-sell or flexible mortgage, however, will allow you to sell the property shortly after purchasing it. Of course, you pay for this flexibility in the form of much higher interest rates, higher fees, and a significantly larger deposit.
  • Bridging loan – A bridging loan is a short-term, high interest loan, often used by people who need to buy a property while waiting to sell another. They are also popular among property developers, who can use bridging loans to buy a property, fix it up, and then sell it, paying off the loan and interest in the process. They are a secured loan, so are most suitable for those who already own property or land that the loan can be secured against. You’ll also need a clear exit plan, i.e. a clear strategy for how the loan will be paid off at the end of the term.
  • Property development finance – Generally offered to established property development businesses, this is basically a form of business loan for property development companies, meaning it will generally take into account your turnover and other financial figures.
  • Personal loan – Whether you’ve inherited a property that needs a bit of TLC or just require a little extra cash for light refurbishment, then taking out an unsecured personal loan might be a good option.

Handling your finances

Starting a business takes time, money and effort. Fortunately, accounting software can help with all three.

If you have started developing properties, either to sell on or rent out, you'll need to make sure you keep an eye on your finances. From paying for materials or contractors – to monitoring incoming revenue and organising your taxes, there is a lot do. There are several options here: you can manually organise all of this yourself, pay for an accountant to help out, or you could use software specifically designed to do all this.

Accountancy software simplifies the often complex processes involved in making sure your finances stay balanced. Much cheaper than hiring external support, this software allows you to keep an eye on your money in a much easier way than doing everything manually.

Take a look at our top-rated accounting software options below:

The key thing to not about property development is that it’s not a quick way to make a fast buck – while analysts are cautiously predicting the market to recover over the medium term, it’s going to be a long time before it returns to the sort of massive gains we saw in the past. However, if approached with the right mindset, it can be a good source of long-term investment.

If you’re tempted, begin by diligently completing these six steps, they’ll be crucial to the success of your plans.

  • Produce a property development business plan
  • Decide whether you want to use a buy-to-let or buy-to-sell business model (or even a combination of both)
  • Research your market carefully – you’ll need to know what’s selling, for how much, and what buyers are looking for
  • Work out your ROI/rental yield, this will give you an idea of how viable your plans are financially
  • Consider your target market – everything you do should have your ideal renter or buyer in mind, think about what they’re looking for, not what you want to do
  • Sort out your finance – whatever you want to do, you’ll need cash, so carefully consider the funding options available and work out how you’ll afford the repayments

You’re ready to get started – good luck!

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How To Write a Property Development Business Plan

A business plan is an essential part of any property development company, providing all vital information regarding how the business will run and operate while securing funding. Consider information required for a general business plan and expand on this for your sector. 

What are the Benefits of a Business Plan?

  • Writing your business plan helps gain in-depth knowledge of the industry
  • A business plan is something you will revisit frequently with new ideas 
  • Sitting down to think about your business at this level of detail gives you clear and informed ideas
  • A business plan helps secure investor funding or bank loans

What Should I Include In My Property Development Business Plan?

Acquisition, development, exit strategy, financial projections, sales and marketing, strengths, weaknesses, opportunities and threats analysis, market research.

This should be a detailed description of plans to buy property, price ranges, projected timescales, estimated exit value, construction types, and planning permission status. 

This section requires a detailed outline of all capital needed to purchase properties, including personal investment, outside investment, and loans.

This should outline your plans for the development of buildings, including any conversions and extensions. Consider if you will be developing land or property and if planning permission will be needed. 

A description of the company structure, be it sole trader, trust, partnership, or company. To begin with, it may be easiest to set up as a limited business, however, it is worth doing research if you are not aware of your options. 

Outline your plans to generate revenue from your properties, such as selling or renting. You will also need to consider tax relating to buy to sell or buy to let.

One of the most important aspects of your business plan is to outline financial projections, including profit margins which cover profit compared to revenue, profit compared to cost and return on investment.

It is worth researching different marketing techniques and adding these to your business plan. 

This section is particularly important when seeking external investment. This should outline everything you can think of that may be applicable to each section. Consider competitors, material costs, and market values among others. 

A detailed hierarchy should be included with a diagram that shows the structure, including directors, consultants and anyone else involved long term.

Market research is perhaps one of the first steps in developing your business plan, having this specific data will help with your sales and marketing plans. 

Your business plan is important, it is worth taking your time to develop and research your ideas while creating a well-structured and informative plan which can be referred to for all business questions. 

For advice and information on business plan writing refer to our blog or read further information about our business plan writing services . CBM can also be contacted via the contact form on our website or call our expert team on 01604 420 420.

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  • Making a property investment business plan
  • Rental yield calculations
  • Property investment strategies
  • How to quit your job and invest in property

Setting investment goals

  • Are property training courses worth the money?
  • Do you need a property mentor?
  • The process of buying an investment property
  • How to evaluate a property investment
  • Property assessment checklist
  • The 4 types of property deal I look for (and why)
  • How to find a property sourcer
  • Deciding where to invest
  • How to flip a house: the ultimate guide
  • Rent-To-Rent: The ultimate guide
  • Lease Options explained
  • Lending against property
  • Lessons from running a letting agency
  • How to get started with limited funds
  • Mortgages: The ultimate guide
  • Mortgages for limited companies
  • New mortgage rules: rental cover and portfolio landlords
  • Interest-only vs repayment mortgages
  • Bridging finance: the ultimate guide
  • Property joint venture agreements – The ultimate guide
  • Recycling your cash
  • Self-manage or use a letting agent?
  • Landlord insurance guide
  • How to find tenants
  • Writing a tenancy agreement
  • What does self-managing a property involve?
  • Rent guarantee insurance
  • The 18-year property cycle
  • Will London house prices crash?
  • Avoiding Inheritance Tax
  • Exit strategies
  • Mortgage interest relief
  • Buying through a company

How to create a rental property business plan (and why you need one)

Last updated: 21 October 2022

Take it from someone who’s spoken to a lot of investors over the last few years: almost everyone who achieves great success started out with a solid plan.

All businesses start out with a plan . Even if that plan is just “I think I can buy this widget for £1 and sell it for £1.50”, it’s still a statement of what the business will do and how it will make a profit.

But many – in fact, most – wannabe property investors start out without even the most basic of plans. Often, people have nothing more than vague thoughts like “ property prices go up, so it’s a good investment ” or “ most wealthy people seem to own property ”.

It might feel like sitting around planning is just delaying you from getting out to look at properties and start making money. But take it from someone who’s spoken to a lot of investors over the last few years: almost everyone who achieves great success started out with a solid plan.

(Or to put it another, more painful way: almost everyone who didn’t start with a plan ends up disappointed with where they end up – however much effort, money and time they put in.)

What does a rental property business plan look like?

It certainly doesn't need to be 100 spiral-bound pages of projections and fancy charts. In fact, the best plan would be so simple that it fits on the back of an index card – meaning that you can commit it to memory and use it to drive every decision you make.

In order to get to that simplicity though, you might need to do some seriously brain-straining thinking first.

It's not easy, but it is simple: your plan basically just needs to set out…

Where you are now

  • Where you want to get to, and
  • What actions you're going to take to bridge the gap

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To give a cheesy analogy, you can't plan a route unless you know where you're starting from.

Working out your starting point is the easiest part, because it involves information that's either known or easily knowable to you.

You'll need to be clear about:

  • The amount of money you've got to invest
  • The amount of savings you can allocate to property investment in future years
  • The time you can invest each week or month
  • The skills and knowledge you can apply to your property business

Note that I said it was the easiest part, but still not easy – because it involves honesty about what you can commit, and self-knowledge to determine where your strengths lie.

Knowing how much money you've got to invest should be straightforward, but it's probably worthwhile speaking to a mortgage broker to check that you'll have borrowing options – because this will determine your total investment figure. A broker will also be able to tell you about your options around releasing equity from your own home, if that's something you want to consider.

I'd also strongly encourage you to consider what “emergency fund” you want to keep in cash, and deduct that from your total investable funds. I suggest having at least six months' expenses in the bank at all times: the last thing you want is to plough every last penny into investments, then lose your job the next day and be unable to pay your bills.

Where you want to get to

So now you know where you're starting from, where do you want to end up? In other words, what's your goal?

Yes, you want to be “rich”, or “secure”, or “build a future” – but what does that actually mean, in pounds and pence terms, for you?

And just as importantly, when do you want to have achieved that?

You might be surprised by how much thought is involved in answering these questions properly. It's easy to throw around terms like “enough to fund my lifestyle” and assume that it might involve an income of £10,000 per month, but it's another matter entirely to look honestly at your ideal lifestyle and determine what a genuinely meaningful figure is.

The same is true for “when” – and it's an often-ignored factor that actually cuts to the heart of the most basic of investment decisions.

For example, take a choice between two properties:

  • Property 1 will give a return on your investment of 15% but will probably never increase in value
  • Property 2 will give a return of 7% but has the potential to double in value over the next decade.

If your goal is to create a certain monthly income within three years, the Property 1 is likely to be a better choice. Growth is unlikely to happen to any great extent over that time, so you need to optimise for cash in the bank right now.

On the other hand, if you have a decade before you want to have achieved your goal, Property 2 is probably the better bet. It very much is a “bet” because you're taking something of a gamble on capital growth, but it's got a lot of time to happen – and when it does, your returns will dwarf the higher rental income you'd have made from the other property.

That's just one example of why making even simple decisions in your property business are impossible without having that most basic ingredient of your plan: where you ultimately want to end up, and when.

So, by this point in the plan you need to:

  • Assess your finances to build up an honest picture of where you are now
  • Put some serious thought into where you want to get to, and when

If you need help with this goal-setting process, I co-own Property Hub Invest which offers free strategy meetings . It's often easier to work this stuff out in conversation with someone who knows their stuff, rather than doing it all in your own head.

That's a great start, but for most people it'll produce an uncomfortable insight: the gap between where you are and where you want to be seems impossibly large! With the resources you've got now, how are you possibly going to reach your goal in a sensible period of time?

Well, that's where it's time to start thinking about the details of the third step: the strategy you'll use to pursue your goal.

A strategy to bridge the gap

The steps you take to get from Point A to Point Z are what's commonly referred to as your strategy – and strategy is a vital component of your business plan.

The way I like to think about strategy is the way you compensate for a lack of cash . It's an unusual way to look at it, but I find it useful – because it tells you (given your timeframe and your goal) how much heavy-lifting your strategy will need to do to keep you on track.

Think of it like this: if you had £10m in the bank and your goal was to make an income of £5,000 per month within a year, you wouldn't need any strategy at all . You could just use your £10m to buy any properties, anywhere – you wouldn't need to maximise the rent, manage them well or even keep them all occupied at all times! You'd be able to buy so much property that you really couldn't fail.

Sure, it'd be a pretty stupid thing to do – you should really have had a more ambitious goal – but you get the point.

Obviously, most of us aren't in that position – and that's why we need a strategy.

So, just what position are you in?

A rule of thumb

A handy way of looking at it is to take the amount of money you've got to invest in property, and assume that you can get a 5% annual return on that money (ROI) – which is a rough rule-of-thumb for a normal property bought with a 75% mortgage.

So, if you've got £100,000, you can generate a (pre-tax) profit of £5,000 per year – or £416 per month.

That's unlikely to be enough to hit most people's goals – but then there's the time factor. If you save up the rental income for 20 years, you'll be able to buy another batch of properties just like the first – so you'll now have income of £832 per month.

If you're happy with that, then you've already got your strategy: buy properties that will give you your desired ROI, then wait!

Portfolio-building strategies

But most people will want more than that: we've hardly been talking about life-changing sums, and 20 years is a long time to wait before you can buy again!

This is where more of an advanced strategy comes in, allowing you to get better results, faster.

This might include:

  • Buying properties and adding value, so you can refinance at the higher value and buy your next property more quickly ( learn more about this strategy )
  • Buying properties at a discount, allowing you again to refinance at the higher value and move on to the next one
  • Turning properties into HMOs, so you can generate a higher ROI on them
  • “Flipping” properties for a profit, so you can replenish your cash more quickly ( read my guide to flipping )

…or something else entirely.

I go into different strategies in enormous detail in my book, The Complete Guide To Property Investment .

Simply appreciating the need for one of these strategies from the start is a really big deal.

Most people don't: they'll rush in, use all their money to buy properties that generate (say) £500 profit per month, then…what? They'll be stuck – because they didn't go in with a plan for how they were going to get to their target number . They'll effectively be starting from scratch, having to scrape together the money to go again.

It's extremely common, and it doesn't surprise me – but it does frustrate me. If they'd started with just a bit of time making a plan, they wouldn't have made this mistake – because it would have become very obvious that they wouldn't reach their goal without applying some strategy.

Any of the strategies I listed (or a different one, or a combination of several of them), when applied effectively, can get you to where you need to be. But that's not to say that all of them will be equally good for you. Each of them has different risk factors, requires different time commitments, are suited to different skill sets, and so on.

That's why this is your business plan: copying someone else's homework isn't going to do you any good, because their skills, attributes and preferences will be different from yours.

For example, one person's plan might be to get their hands dirty by renovating properties for resale – completing two projects per year, and using the profits to buy an HMO. Within five years they'll have five HMOs, which will give them all the income they need.

Someone else might be hopeless at anything hands-on, but a master negotiator. Their plan could be to buy at enough of a discount that they can pull at least half of their funds back out again by refinancing – and keep doing that until in ten years' time they have 15 single-let properties giving them their target income figure.

(That's why when someone emails me asking if their strategy “sounds good”, I have to say that I don't know: usually it sounds like on paper like it would work for someone , but I have no idea if they're the right person to execute it.)

So, coming up with your strategy involves:

  • Starting with an assessment of where you are now
  • Deciding where you want to get to, and by when
  • Seeing how far you'll fall short by just buying “normal” properties
  • Thinking about your own skills, time and preferences to choose which strategy (or strategies) you'll use to fill in the gap

It might take a while, and that's OK – it's not an easy decision . To take the pressure off though, remember: your plan isn't set in stone. It's important to start with a clear vision and not get distracted by every new opportunity that comes your way, but every plan is just a starting point: you'll be seeing what works, reviewing and adjusting course along the way.

Once you've got a strategy down on paper, that's a huge step – and you should congratulate yourself, because it's a step that most people will never make (and will suffer for).

But of course, the act of writing the plan isn't going to magic it into existence: you need to get out there and execute on the plan.

Turning your property business plan into action

Having an appropriate goal and a solid strategy to get you there are essential, sure – but nothing is going to happen until you actually take the steps that are necessary to execute that strategy.

If you don't take the time to identify the steps and make a plan to carry them out, you'll end up in “pulling an all-nighter the day before your homework is due in” mode. And you don't want that: it's no good setting a five-year goal, feeling all virtuous for being such a strategic and big-picture thinker, then realising in four years and 364 days that you've not actually got any closer towards making it a reality!

So let's get those steps in place. And the good news is…it's really simple. (The best things usually are.)

Breaking it down

However big, ambitious and far in the future a goal seems to be, all goals are achieved in exactly the same way : by breaking them down into individual tasks, and working through those tasks one by one.

As you work through those tasks, it’s important to have sub-goals as “checkpoints” along the way.

Sub-goals are how you stay on track: by setting a deadline for each sub-goal, you can make sure that your progress is fast enough. They also keep you motivated, because it means you’ll always have a small “win” on the horizon: you won’t just be looking at the main goal (potentially) years off in the future. Think of them as mile markers at the side of a marathon course.

To put it another way:

Small task + Small task + Small task = Sub-goal Sub-goal + Sub-goal + Sub-goal = Overall goal

It's those small daily tasks that are the foundations of your achievement. And that's the beauty of a good plan: all you need to concentrate on is ticking off your tasks each day, and your overall goal is achieved automatically!

So, this final step in your plan is about breaking that big goal down into sub-goals, and those sub-goals down into bite-sized individual tasks. That's it!

As you break it down, there are a few things I find are useful to think about…

One-off tasks v recurring tasks

Your business will have two types of task:

  • One-off tasks , like finding a mortgage broker
  • Recurring tasks , like viewing properties and making offers

These two types of task will both appear in your weekly, monthly and quarterly to-do lists. A useful way of planning your time is to start by filling in your recurring tasks – like going through portals to find new potential acquisitions every day, and calling agents to follow up on offers once per week – then adding your recurring tasks on top.

By thinking about both types, you'll make sure you're not dropping the ball on the important day-by-day stuff, but you're also not ignoring the big-picture one-offs that are going to make a huge difference to your business in the long run.

The first, simplest step

Just like you break a goal down into sub-goals and sub-goals down into tasks, I favour breaking every one-off task down into the smallest possible unit .

For example, “find a mortgage broker” could be an important one-off task for you, but it's not something you can just sit down and do until it's done. Because it seems nebulous and you can never identify a block of time when you can do it from start to finish, you can end up never doing it at all.

Instead, you'll make yourself feel better by ticking off smaller tasks that seem easier – but are often less important.

The solution is to break every task down into as many sub-tasks as possible. So instead of “find a mortgage broker”, the tasks become :

  • Email 3 contacts to ask for recommendations
  • Post on The Property Hub forum to ask for recommendations
  • Email everyone who is recommended to set up a quick call
  • Draw up a shortlist of 2-3 people to have a longer conversation with
  • Pick a winner

Doesn't that seem much easier already? You can imagine sitting down and bashing out the first task in five minutes right now, then you're underway!

Who will do each job?

Here's a potential lightbulb moment: you don't have to do everything in your business yourself.

Any business has different “functions”, or departments – like sales, manufacturing, and admin. A property business is no exception.

The basic functions of all property businesses are the same:

  • Acquisition
  • Refurbishment
  • Refinancing/selling

The types of task that fall within each function will depend on your business plan. For example, if your aim is to find properties you can buy “below market value”, acquisition could be a major part of the business – involving direct-to-vendor marketing, networking with estate agents, and attending auctions.

On the other hand, if your model involves buying properties that you think will experience strong capital growth, there could be a lot more tasks in the “research” part of the business – and acquisition could be very straightforward once you’ve identified the opportunity itself.

Could you do every task within every function yourself? Maybe.

Could the business achieve better results if you bring in specialists to do what they do best? Definitely .

You could go big and employ an assistant to view properties and make offers for you, or just make sure you outsource functions like management and accountancy to the relevant professionals.

Whatever you do, once you start thinking about your property venture as a business with various departments, you'll start to break away from the idea that this is something you have to do all on your own – and that's a very powerful insight.

OK, this has been a long one – but we've covered a lot of ground.

To recap, those critical steps are:

  • Assess where you are now
  • Work out where you want to be, and by when
  • Outline a strategy to get you there
  • Fill in the detail, to get you from “big picture” to individual steps

It's a process that's worked for me, and I've seen it work for many investors I've encouraged to put it into action too.

Its power is in its simplicity: you take the time to intelligently decide exactly what you need to do, then you figure out a way to (to borrow a registered trademark) just do it . As long as you show up and work through your to-do list each day, the big, scary, long-term goal takes care of itself!

Of course, you'll need to assess your progress and adjust course along the way: nothing will pan out exactly as expected, and there's a lot that can change over a timespan of several years.

But by having your plan, what you won't do is get distracted by every new idea that comes your way – researching HMOs one day, and holiday lets the next – and end up getting nowhere.

(You'd be amazed by how many plan-less people that description fits to a tee.)

So now you know how to put a property business plan together. It's not a plan that will necessarily get you funding from the bank, but it's something more important than that: a plan you can use every day to make sure you stay on track to hit your goals.

The one thing that every successful investor does

Making a Property Business Plan

Push pins connected by strings to demonstrate strategy

Make no mistake, property investment is a business. Successful property investors and professional landlords don’t risk ‘winging it’. They have a solid plan in place from the beginning and they continually review this plan as the business grows.

“Failing to Plan is Planning to Fail”

Not having any kind of coherent plan is a recipe for disaster. You don’t need a 500-page document outlining every last detail, with colourful graphs included, but you do need a clear statement of intent.

People who go ahead without a plan are guaranteed to fail at some point. And they usually lose a lot of money in the process.

Creating a Property Business Plan

There is no right or wrong way of creating a business plan but bear in mind that a lender may want to see your business plan before they commit to offering you mortgage funding. Therefore, it’s a good idea to be as thorough as possible. Do your research, include pertinent facts and figures, and be willing to back these up with evidence.

To help you get started, we will outline the basic steps to follow below.

Step 1 – Your Current Situation

Where you are right now is the foundation for your business plan.

  • How much money are you planning to invest?
  • Where is this money coming from – a BTL mortgage, inheritance, savings, etc.
  • How much time are you willing to spend on your business? For example, if you want to run your portfolio part-time, you will probably need to use a letting agent, so you’ll need to factor in their costs.
  • How much experience do you have?
  • Do you require any training?

Be honest when answering these questions. This business plan is your blueprint for the way forward.

Step 2 – Where do you Plan to be in 3, 5, or 10 Years?

lv-An image of the how to create a property business plan guide-bg

Think of your property business plan as a road map. Your starting location is where you are now. Your final destination is where you hope to be in three, five, ten years or more.

This is when you need to think carefully about your goals.

  • How many properties do you plan to add to your portfolio?
  • Do you plan to manage your portfolio full-time?
  • Do you need a set income from the business?
  • Is this a long-term capital investment designed to supplement a pension in years to come, or a short-term profit strategy?

Answering these questions is a good opportunity to flesh out your long-term goals. Put a lot of thought into where you hope to be in X number of years. Write it down and discuss it with friends, family, and mentors. The more you discuss your strategy, the easier it will be to spot any potential holes in the plan.

Be realistic about your goals. It’s one thing to say “I want to own a portfolio worth £1.5m in five years” and quite another to achieve this goal. Still, it’s good to be ambitious, as long as you have a realistic strategy in place.

If you do plan to manage your portfolio full time, landlord software is a great option to keep all your property information up to date and stored in one place. Check out what landlord software can do for you.

Step 3 – Creating a Property Business Strategy

Your business strategy is how you meet your goals. This is where you come up with solutions to problems. For example, if your savings are relatively meagre, your strategy needs to address the problem of funding. It tells you how much work you have to do to meet your goals.

In the early stages, it isn’t necessary to come up with a detailed business strategy. Simple is good. It means you can remember it and use it to inform the decisions you make on the fly. However, once you have your main goals fleshed out, it is sensible to go into greater detail on the what, when, how, and why.

Problem-solving is a lot easier on paper using imaginary scenarios, than when faced with the stress of a real life problem. Try and think through every possible thing that might go wrong. Plan ahead and work out different investment strategies, so you can see which one works best.

Step 4 – Cash Flow Projections

Successful property investment relies on adequate cash flow. Do the maths. Plug in numbers and see which properties generate the best rental yields. Check out mortgage deals and see whether using one property to finance another is an option. Figure out what your expenses are likely to be and how much rental income you need to cover these and still give you a decent return.

Factor in personal expenses too. Remember that you’ll need to cover your own bills if something goes wrong. For example, if you lose your main job or get sick, can you afford to live and continue managing your properties?

Speak to a Financial Advisor

Since financing a property investment portfolio is critical, it’s worth speaking to a financial adviser when preparing a property business plan. Run through different funding options. Check out available financing deals with different lenders. Take advice on the best way to finance your investment plans. For example, you may be considering using an equity release scheme to free up some money from your family home. Now is a good time to find out whether this is a smart idea, or not.

Always speak to an independent advisor if you want objective advice.

Strategize different investment models. For example, compare the potential rental yields from an HMO compared to a house suitable for families. There may be a higher up-front investment required to convert a property into an HMO, but in the long-term, it could generate a better return on investment.

There are many different investment models worth considering. HMOs are one, but others include property flipping, student lets , buying properties at a discount, perhaps via auction, and then adding value.

Now is the time to work through your options and decide which one is right for your individual circumstances.

Building a Property Portfolio

Making a property business plan prior to investing in a single property doesn’t need to be too comprehensive. All you really need to think about are funding, management, and what type of property you want to buy.

Building a portfolio of 3+ properties requires more thought, however, and if your long-term plan is to own a portfolio of 20+ properties, then this will need a more advanced business strategy.

Talk to Other Investors

Other investors have been where you are now. You can learn from their experiences, good and bad. Use this to help you strategize. Don’t make the mistake of treating their business plan as your strategy, as their skills and experience won’t mirror yours, but it is helpful to see how other investors manage their businesses.

You might discover that something you planned to try isn’t profitable in your area. This is where local knowledge comes in handy. For example, perhaps you see HMOs as a gold mine, but after chatting to letting agents and other investors, you realise that the market is oversaturated and there are already too few tenants whereas demand is high for one and two-bed flats for young professionals.

It’s better to find out now before you spend a fortune converting an old Victorian property into an HMO rather than subdividing it into self-contained flats.

Take Your Time

Don’t rush the process of creating a working business plan. Begin with your current situation and decide where you want to be at a predetermined point in the future. As long as you have a clear – and realistic – way of making that journey, the rest should all come together.                                      

And finally, be flexible and willing to make adjustments to your business plan. The best-laid plans don’t always work as intended. Things change, unexpected problems arise, and your goals may change for reasons you hadn’t considered. As long as you are adaptable and willing to roll with it, none of this will matter too much.

Have you created a property business plan? Tell us more about your property investment goals – we’d love to hear from you!

Read More Like This:

Should Landlords Use a Letting Agent?

What is Rental Yield and why is it Important?

The Pros and Cons of Student Lets

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Development Finance for First-Time Developers in the UK: A Guide

Embarking on a journey as a first-time property developer in the UK is an exciting prospect filled with opportunities and challenges. Among the most significant challenges is securing development finance, a crucial component that fuels the realisation of construction projects and property ventures. In this article, we explore the landscape of development finance for first-time developers in the UK, discussing the ease of obtaining financing, key considerations, and strategies for success.

Understanding Development Finance

Development finance is a specialized form of funding designed to support property development projects, including residential, commercial, and mixed-use developments. Unlike traditional mortgages or personal loans, development finance is tailored to the unique needs and risks associated with construction and property development.

Accessibility of Development Finance for First-Time Developers

For first-time developers in the UK, accessing development finance can be a challenging task, primarily due to the inherent risks involved in property development and the stringent lending criteria of financial institutions. However, despite these challenges, avenues for securing development finance do exist, provided developers understand the requirements and take proactive steps to mitigate risks.

Key factors influencing accessibility

  • Experience and track record : Lenders typically prefer developers with a track record of successful projects and relevant industry experience. While being a first-time developer may present challenges in this regard, demonstrating competence, knowledge, and a well-thought-out development plan can enhance credibility in the eyes of lenders.
  • Project viability and feasibility : Lenders assess the viability and feasibility of proposed development projects to mitigate risks associated with funding. First-time developers must present comprehensive feasibility studies, including market analysis, cost projections, and risk assessments, to convince lenders of the project's potential for success.
  • Financial stability and creditworthiness : Lenders evaluate the financial stability and creditworthiness of developers to assess their ability to manage project finances and repay loans. While first-time developers may lack established financial histories, providing personal guarantees or partnering with financially stable entities can bolster confidence in lenders.
  • Collateral and security : Development finance is typically secured against the development site or completed properties, providing lenders with collateral in the event of default. First-time developers must identify suitable collateral and security arrangements to mitigate risks and reassure lenders of their commitment to the project.

Strategies for securing development finance

  • Build relationships with lenders : Establishing relationships with lenders and financial institutions specialising in development finance can provide valuable insights and facilitate access to funding opportunities. Attend industry events, network with professionals, and seek advice from experienced developers to identify potential financing partners.
  • Prepare a robust development plan : Develop a comprehensive development plan outlining project objectives, timelines, budgets, and risk management strategies. Engage with industry professionals, including architects, quantity surveyors, and legal advisors, to ensure the plan is well-conceived and executable
  • Demonstrate market understanding : Conduct thorough market research to identify demand trends, the competitive landscape, and potential risks affecting the development project. Present compelling market insights and differentiation strategies to lenders, highlighting the project's alignment with market dynamics and demand drivers.
  • Mitigate risks and enhance credibility : Proactively identify and mitigate risks associated with the development project, including planning constraints, construction risks, and market fluctuations. Implement risk management measures, such as contingency plans, insurance policies, and feasibility buffers, to enhance credibility and reassure lenders of the project's resilience.

Securing development finance as a first-time developer in the UK requires diligence, preparation, and strategic planning. While the process may present challenges, it also offers opportunities for growth, innovation, and success. By understanding the factors influencing accessibility, adopting proactive strategies, and leveraging industry expertise, first-time developers can navigate the complexities of development finance with confidence, realising their vision, and contributing to the vibrant landscape of property development in the UK.

This was posted in Bdaily's Members' News section by iCONQUER Ltd .

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Home » Sample Business Plans » Real Estate

A Sample Property Development Business Plan Template

Are you about starting a real estate development company? If YES, here is a complete sample property development business plan template you can use for FREE. Okay, so we have considered all the requirements for starting a property development business.

We also took it further by analyzing and drafting a sample property marketing plan template backed up by actionable guerrilla marketing ideas for property development businesses. So let’s proceed to the business planning section.

Why Start a Property Development?

It is therefore no doubt that housing is one very essential ingredient to life. The moment one is able to find a place of abode, there comes a form of huge relief. It is for that reason that the need for the government of different parts of the world to provide basic shelter for its citizens cannot be over flogged.

Every day there are an avalanche of people who dive into the property development business because they know how lucrative this trade is and how money spinning it becomes when one is able to get a hang of it. This is why those who have scaled through the teething stage of the business know that adequate planning is one of the hurdles that just must be scaled so as to get things right.

1. Industry Overview

The property development industry falls into the real estate category and it is indeed a very large industry that has the potential to make entrepreneurs millionaire within a short period of time. Property development industry is a many-sided business that covers all aspect of activities, ranging from acquiring raw lands, to selling or renting or leasing of fully finished and furnished properties.

In essence, developers are responsible for turning ideas into real properties; i.e. they acquire lands, they finance real estate deals, they engage in building projects and they sell, rent, lease and even manage properties on behalf of their clients.

Beyond every reasonable doubt, one of the most profitable, creative and interesting aspect of the real estate industry is property development. As a matter of fact, developers are major players when it comes to determining the prices of properties. Although this type of business venture can be risky, but in order to make it big in the trade as a property developer, you have got to just take calculated risks.

Just like all other investment vehicles, there are potential down sides that you need to look out for as a property developer. One of the major risks in property development is a sudden down turn in the economy. Property development could take a period of two to three years from conception to completion, depending on the size of the project and the cash flow.

As a matter of fact, some projects could even take much longer than that. Because of the time frame involved in developing properties from start to finish, loads of unanticipated things could crop up and it falls in the thick of property cum economy downturn which is not good for the business considering the investment that has gone into the project.

Another factor that is of major concerns and a threat to property development business generally could be cost increase as a result of inflation, currency devaluation as well as economic challenges.

Unforeseen delays from the part of government agencies, litigation and also delays from contractors could lead to substantial cost increase especially if the project is heavily dependent on bank loans. If perhaps during this period there is a change in the supply and demand dynamics of the property sector, the project could as well be affected negatively.

As a property developer, it is very important to be creative, to be able to use your ideas to meet the rapidly changing needs of the society when it comes to properties; you should be able to convert a slum into a beautiful city, if indeed you want to become a major player in the real estate industry.

Over and above, the property development sector is known to be a major contributor in the economy of many nations of the world and the industry is notable for producing some of the richest men in the world.

2. Executive Summary

Solorio’s® Property Development Company is a property development company that will be based in 530 Madison Avenue New York, NY 10033, USA. Our aim of starting this business is to work in tandem with the government of the united states of America to deliver affordable homes and properties for all classes of people in the United States of America.

Our Head Office will be located in New York City, but we will have our branch offices in major cities in all regions of the United States of America. During the first two years of operation we would have set up our offices in the following locations; Las Vegas, Washington, DC, Dallas, Texas and Boston.

Solorio’s® Property Development Company is going to be a self-administered and a self-managed real estate investment trust (REIT). We will work towards becoming one of the largest owners, managers, and developers of first-class properties (accommodations, public buildings and office properties) in the United States of America.

We are quite aware that property development business requires a huge capital base, which is why we have perfect plans for steady flow of cash from private investors who are interested in working with us. We can confidently say that we have a robust financial standing and we are ready to take on any property development deal that comes our way.

As part of our plans to make our customers our number one priority and to become the leading property development company in New York City, we have perfected plans to work with our clients to deliver projects that can favorably compete with the best in the industry, at an affordable and reasonable price within the stipulated completion date barring any unforeseen circumstance and also to generate great value from any property that we manage (both for our clients and for the company).

Solorio’s® Property Development Company will become a specialist in turning slums into beautiful cities and turning a run –down and dilapidated building into a master piece. And that hopefully will be our brand and signature.

Solorio’s® Property Development Company will be owned majorly by Shannon McKenzie and family. Shannon McKenzie is a property guru that has worked with top Real Estate Companies in the United States of America for many years; prior to starting his own business. Other investors with same investment ideology whose name cannot be mentioned here for obvious reasons are also part owners of the business.

3. Our Products and Services

Solorio’s® Property Development Company will be involved in the core real estate business and because we aspire to become one of the leading property development company in New York City, we have decided to explore every available means of generating money from Property Development. Our business offering can are listed below;

  • Developing Properties for our Clients
  • Leasing of Properties
  • Renting of Properties
  • Selling of Fully Furnished Properties
  • Selling of Landed Properties
  • Leasing of Bare Land
  • Manage Properties and Facility for Clients
  • Property Makeover Services
  • Real Estate Consultancy and Advisory Services

4. Our Mission and Vision Statement

  • To deliver affordable and quality properties to all classes of people in the United States of America.
  • At Solorio’s® Property Development Company, our mission and values is to help people and businesses in the United States of America and throughout the world realize their dreams of owning properties.

Our Business Structure

Solorio’s® Property Development Company is aiming to be amongst the leading property development companies in New York City, and the only way for us to attain this position is to structure the business for growth and to hire the best hands we can get in the industry.

We want to build a team that will work together towards achieving the company’s goal and also a business with standard structure and processes; a business that runs on auto pilot. In view of the above, we have made provisions for the following positions in our organization;

  • Chief Executive Officer

Project Manager

Civil Engineer

  • Structural Engineer
  • Quantity Surveyor

Land Surveyor

Company’s Lawyer/Secretary

Admin and HR Manager

Business Developer

  • Front Desk Officer

5. Job Roles and Responsibilities

Chief Executive Officer – CEO:

  • Responsible for providing direction for the business
  • Creating, communicating, and implementing the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
  • Responsible for the day to day running of the business
  • Responsible for handling high profile clients and deals
  • Responsible for fixing prices and signing business deals
  • Responsible for signing checks and documents on behalf of the company
  • Evaluates the success of the organization
  • Reports to the board
  • Responsible for the planning, management and coordinating all projects on behalf of the company
  • Supervise projects
  • Ensures compliance during project executions
  • Provides advice on the management of projects
  • Responsible for carrying out risk assessment
  • Using IT systems and software to keep track of people and progress of ongoing projects
  • Responsible for overseeing the accounting, costing and billing of every project
  • Represents the organization’s interest at various stakeholders meetings
  • Ensures that project desired result is achieved, the most efficient resources are utilized and different interests involved are satisfied.
  • Responsible for preparing bids for tenders, and reporting to clients, public agencies and planning bodies
  • Ensures that sites meet legal guidelines, and health and safety requirements
  • Assesses the environment impact and risks connected to projects
  • Responsible for judging whether projects are workable by assessing materials, costs and time requirements
  • Draws up blueprints, using Computer Aided Design (CAD) packages
  • Discusses requirements with the client and other professionals (e.g. architects and project managers et al)
  • Responsible for managing, directing and monitoring progress during each phase of a project
  • Responsible for creating building designs and highly detailed drawings both by using the hands and by using specialist computer – aided design (CAD) software
  • Working around constraining factors such as town planning legislation, environmental impact and project budget
  • Writes and presents reports, proposals, applications and contracts
  • Adapts plans according to circumstances and resolving any problems that may arise during construction
  • Works with project team and management to achieve a common goal
  • Responsible for applying for planning permission and advice from governmental new building and legal department.
  • Responsible for undertaking land surveys/measurements using a variety of specialist technical equipment such as theodolites, laser alignment devices and satellite positioning systems et al.
  • Responsible for presenting data to clients
  • Responsible for producing and advising about construction plans and drawings
  • Responsible for advising about technical matters and whether the construction plans are viable
  • Responsible for drawing up contracts and other legal documents for the company
  • Consults and handles all corporate legal processes (e.g. intellectual property, mergers & acquisitions, financial/securities offerings, compliance issues, transactions, agreements, lawsuits and patents et al)
  • Develops company policy and position on legal issues
  • Researches, anticipates and guards company against legal risks
  • Represents company in legal proceedings (administrative boards, court trials et al)
  • Plays a part in business deals negotiation and take minutes of meetings
  • Responsible for analyzing legal documents on behalf of the company
  • Prepares annual reports for the company
  • Responsible for overseeing the smooth running of HR and administrative tasks for the organization
  • Defines job positions for recruitment and managing interviewing process
  • Carries out staff induction for new team members
  • Responsible for training, evaluation and assessment of employees
  • Responsible for arranging travel, meetings and appointments
  • Oversees the smooth running of the daily office activities.
  • Identifies, prioritizes, and reaches out to new partners, and business opportunities et al
  • Responsible for supervising implementation, advocate for the customer’s need s, and communicate with clients
  • Develops, executes and evaluates new plans for expanding increase sales
  • Documents all customer contact and information
  • Represents the company in strategic meetings
  • Helps increase sales and growth for the company
  • Responsible for preparing financial reports, budgets, and financial statements for the organization
  • Responsible for financial forecasting and risks analysis.
  • Responsible for developing and managing financial systems and policies
  • Responsible for administering payrolls
  • Ensures compliance with taxation legislation
  • Handles all financial transactions for the company
  • Serves as internal auditor for the company

Front Desk/Customer’s Service Officer

  • Receives Visitors/clients on behalf of the organization
  • Receives parcels/documents for the company
  • Handles enquiries via e-mail and phone calls for the organization
  • Distributes mails in the organization
  • Handles any other duties as assigned my the line manager

6. SWOT Analysis

In as much as property development business is a very lucrative business, there are loads of investors and entrepreneurs who are interested in owning a business portfolio in the industry, so as such the competition for available business deals will be much.

This is why we invested time and resources to prepare a killer property development marketing plan. Prior to setting up Solorio’s® Property Development Company we employed the services of tested and trusted business and HR consultants to help us conduct critical SWOT analysis for us.

We did this so as to know how to maximize our strength and opportunities and also to look for ways to properly manage our weakness and the threat that we may likely face in the property development industry as a newbie. Here is a summary from the result of the SWOT analysis that was conducted on behalf of Solorio’s® Property Development Company;

Solorio’s® Property Development Company prides itself in the fact that the management team are core professionals and experts in their own chosen fields and they are some of the best in New York City. Despite the fact that we a new property development company, we can confidently say that we have a strong financial strength to handle most of the deals that we will have to handle.

Our weakness could not be farfetched; we are a new property development company, and there is the possibility of clients to think twice before awarding us contracts. Most people would prefer to deal with companies that have been in existence for a long period of time , as against dealing with a new company that they are not sure will deliver as planned.

  • Opportunities:

Our business concepts and our mission and vision put us at an advantage in the industry. We are set to not only work with big money bags but also to work with smaller clients whose wish is just to have a roof over their head. Furthermore, we are certain that the location of our business is going to bring multiple business opportunities to us.

Some of the threats that we are likely going to face as a property development company are unfavorable government policies, global economic downturn and other big money bags that are major players in the property development industry. There is hardly anything we could do as it concerns this threats, other than to be optimistic that things will continue to work for our good.

7. MARKET ANALYSIS

  • Market Trends

It is no longer news that property development involves various stakeholders with various contributions and responsibilities. In property development you have a synergy involving the property owner, the financier, the property developer and a team of technical experts. The property owner may be an individual or a group and could also be a corporate body.

Before now, the interest of most owners is to sell the property to any willing buyer and move on with their life. However, because of the profitability of the business, there are land owners now who are willing to use their property as a leverage to have an equity stake in the project.

This is a win-win for all the parties since the developer too will use the extra cash savings to accelerate the completion of the project and also to handle other projects. It is obvious that loads of investors are now very much interested in property development business, because it is one of the quickest means of becoming a millionaire and as a matter of fact, it is rare to see a multi – millionaire who does not have a business portfolio in the real estate industry.

One good thing about the property development industry is that it has room wide enough to accommodate as many investors that wants to dive into the industry. We know that we can achieve our business goals and targets in the property development industry in New York City and the United States, which is why we have mapped out our own marketing and sales strategies.

8. Our Target Market

Our target market cuts across people of different classes and people from all walks of life. We are coming into the industry with a business concept that will enable us work with the highly placed people in the country and at the same with the lowly placed people who are only interested in putting a roof under their head.

We are in business to make profits at the same we in business to give our customers the opportunities to own their own properties at an affordable price.

Solorio’s® Property Development Company wants to be known as a company that has the interest of the rich, the middle class and the poor in the United States of America. Below is a list of the people and organizations that we have specifically design our products and services for;

  • Families who are interested in renting/leasing or acquiring a property
  • Corporate organizations who are interested in renting/leasing or acquiring their own property/properties
  • Land Owners
  • Properties Owners
  • University Campuses (Private Hostels)
  • Foreign investors who are interested in owning properties in the United States of America
  • The government of the United States of America (Government contracts)
  • Managers of public facilities

Our Competitive Advantage

There are major players who have gotten a grip of the property development business in New York, but that does not deter us from entering the trade to build our business to become one of the top property development businesses in New York City. Solorio’s® Property Development Company has a management team members that are considered experts in their own chosen area of specialization.

Our CEO has a robust experience in the real estate industry and he is bringing the experience to help build Solorio’s® Property Development Company to become a top brand as far as property development business is concern. Of course, we are a new company, but we have been able to build our capital base to be able to handle most of the projects that we will bid for and also to acquire properties for the organization.

9. SALES AND MARKETING STRATEGY

  • Sources of Income

Solorio’s® Property Development Company is established with the aim of maximizing the profits in the real estate industry via delivering quality and affordable property to our highly esteemed clients. The property business is wide in scope and there are several means of generating income for the company. Below are the sources we intend exploring to generate income for Solorio’s® Property Development Company;

10. Sales Forecast

Prior to launching Solorio’s® Property Development Company we have serious interest in the industry and we have been able to secure some properties that is still under construction. We are optimistic that the projects / properties will be completed within the next two months and we have concluded plans to put the property for lease.

They are office complexes and it is interesting to know that people are already queuing up to rent / lease the available spaces. We are quite optimistic that we will meet out set target of generating enough income / profits from the first month or operations.

We have critically studied the property market and we have examined our chances in the industry and we have been able to come up with the following sales forecast. The sales projection is based on information gathered on the field and some assumptions;

  • Build/develop at least 2 office complex (3 story building each) within the first 12 months of operation
  • Manage a minimum of 5 properties for clients within the first 6 months of operations
  • Sell a minimum of 20 hectares of land within the first 12 months of operation
  • Develop at least one estate within the first 24 months of operations
  • Provide advisory and consultancy services for a minimum of 1 client per month
  • Handle a minimum of 12 building makeover projects within the first 12 months of operations

N.B: Please note that we could not put a specific amount to the projection because the prices may differ for different services and for different clients. Part of our business strategy is to work within the budget of our clients to deliver quality property / properties hence it will be difficult to project what we are likely going to make from such deals.

But the bottom line is that we are definitely going to make reasonable profits from any business deal that we execute. The property market is structured in such a way that property developers will always make profits from any deal they handle.

  • Marketing Strategy and Sales Strategy

Solorio’s® Property Development Company is aware that there are stiffer competition in the property development market in the United States of America, hence we have been able to hire some of the best business developer to handle our sales and marketing.

Our sales and marketing team will be recruited based on their vast experience in the industry and they will be trained on a regular basis so as to be well equipped to meet their targets and the overall goal of the organization.

Our goal is to become one of the leading property development companies in New York City and in every other city where we operate, which is why we have mapped out strategies that will help us take advantage of the available market. Solorio’s® Property Development Company will adopt the following marketing and sales strategies;

  • Introduce our business by sending introductory letters alongside our brochures to all the corporate organizations in New York and other States in the US.
  • Promptness in bidding for contracts.
  • Advertise our business in real estate / properties magazines and websites.
  • List our business on yellow pages.
  • Attend expos, seminars, and business fairs et al.
  • Create different packages for different category of clients in order to work with their budgets and still deliver quality housing/ property to them.
  • Leverage on the internet to promote our business.

11. Publicity and Advertising Strategy

We have been able to work with our consultants to help us map out publicity and advertising strategies that will help us walk our way into the hearts of our target market. First and foremost, we want our brand to be visible and well communicated, which is why we have decided to work with different classes of people in the society.

All our publicity materials and jingles are done by some of the best hands in the industry. Below are the platforms we intend to leverage on to promote and advertise our property development business;

  • Place adverts on both print and electronic media platforms (real
  • Sponsor relevant TV shows
  • Maximize our company’s website to promote our business
  • Leverage on the internet and social media platforms like; Instagram, Facebook ,Twitter, LinkedIn, Badoo, Google+ et al
  • Install our Bill Boards on strategic locations
  • Distribute our fliers and handbills in targeted areas from time to time

12. Our Pricing Strategy

Part of business strategy is to ensure that we work within the budget of our clients to deliver excellent properties to them. We are quite aware that there are major players in the property development industry in the United Stated of America who are not interested in small business deals.

Although our prices may not be outrageously lower than what is obtained in the industry, but we are hopeful that whatever price we bill our customer will be amongst the lowest they can get in the industry. The fact that we are going to be billing our clients lower than what is obtainable in the industry does not in any way affect the quality of our properties.

  • Payment Options

Our payment policy is all inclusive because we are quite conscious that different people prefer different payment options as it suits them but at the same time, we will not accept payment by cash because of the volume of cash that will be involved in most of our transactions Here are the payment options that we will make available to our clients;

  • Payment by via bank transfer
  • Payment via online bank transfer
  • Payment via check
  • Payment via bank draft

In view of the above, we have chosen banking platforms that will help us achieve our plans without any itches.

13. Startup Expenditure (Budget)

  • The Total Fee for incorporating the Business in New York: $750.
  • The budget for Liability insurance, permits and license: $5,000
  • The Amount needed to acquire a suitable Facility with enough space in New York City (Re – Construction of the facility inclusive): $80,000.
  • The Cost for equipping the office (computers, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al): $15,000
  • The Cost of Launching a Website: $600
  • Additional Expenditure (Business cards, Signage, Adverts and Promotions et al): $5,000
  • Working capital (investment fund): $3,000,000 (3 Million US Dollar)

Going by the report from our research and feasibility studies, we will need about $3,200,000 (3.2 US Million Dollars) to set up a property development company in New York City. In property development business, the larger your capital base, the greater the opportunities you can access and the more profits you will make.

Despite the fact that we have a working capital of 3 Million US Dollar, we have been able to create a business relationship with our banks so as to easily access loans when the need arises.

Generating Funding/Startup Capital for Property Development Company

  • The CEO Dr. Shavonne McPherson will generate 20 percent of the start – up capital from her personal savings
  • 30% of the capital will be generated from partners and investors
  • 50% of the capital will be sourced from banks

14. Sustainability and Expansion Strategy

Solorio’s® Property Development Company was established with the aim of building a company that will outlive the founders and partners. Part of the vision of the company is to handover the baton of the company from one generation to another generation; hence we have perfected our plans to put the right structures in place that will aid our succession plan.

We are quite aware that the growth of any business depends solely to the business deals or sales they execute per financial year. We will continue to give our marketing team all the supports they would need to continue to deliver and meet all set targets and corporate goals.

Lastly, we will not relent in taking calculated business risks when it comes to investment and taking on new business challenges and new business frontiers.

Check List/Milestone

  • Business Name Availability Check: Completed
  • Business Incorporation: Completed
  • Opening of Corporate Bank Accounts various banks in the United States: Completed
  • Opening Online Payment Platforms: Completed
  • Application and Obtaining Tax Payer’s ID: In Progress
  • Application for business license and permit: Completed
  • Purchase of All form of Insurance for the Business: Completed
  • Renting of Office Facility in New York City: Completed
  • Conducting Feasibility Studies: Completed
  • Generating capital from the CEO and Business Partners: Completed
  • Applications for Loan from our Bankers: In Progress
  • Writing of business plan : Completed
  • Drafting of Employee’s Handbook: Completed
  • Drafting of Contract Documents (Tenancy Agreements et al), and other relevant Legal Documents: In Progress
  • Design of The Company’s Logo: Completed
  • Graphic Designs and Printing of Packaging Marketing / Promotional Materials: Completed
  • Recruitment of employees: In Progress
  • Purchase of the Needed furniture, office equipment, electronic appliances and facility face lift: In progress
  • Creating Official Website for the Company: In Progress
  • Creating Awareness for the business (Business PR): In Progress
  • Health and Safety and Fire Safety Arrangement: In Progress
  • Establishing business relationship with key players in the industry (networking and membership of relevant real estate bodies): Completed

More on Real Estate

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Property Development Business Plan Template

Written by Dave Lavinsky

Property Development Business Plan

You’ve come to the right place to create your Property Development business plan.

We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their property development companies.

Below is a template to help you create each section of your Property Development business plan.

Executive Summary

Business overview.

Redstone Development is a new property development company located in Salt Lake City, Utah. We focus on residential property development for single-family and multi-family homes. We handle all steps of the process, from sourcing the land to selling the finished property. Redstone Development aims to be the most trusted source of affordable housing in the Salt Lake City metro area.

Redstone Development is owned and operated by Jack Grant, a real estate development industry veteran who is well-versed in the entire property development process. Jack has over 30 years of experience developing residential properties and holds a Master’s in Real Estate Development. His education, experience, and industry connections will ensure that Redstone Development becomes one of the area’s most successful property development businesses.

Product Offering

Redstone Development will handle the entire development process, including sourcing land, securing all necessary approvals and permits, construction, and sale of the finished property.

The company focuses on building single-family homes and multi-family apartment complexes in the heart of Salt Lake City. All projects are designed to make these homes aesthetically appealing and luxurious. However, they will also be affordable to ensure that anyone in the Salt Lake City area can afford to live in our properties.

Customer Focus

Redstone Development will serve home buyers and real estate investors who live and work in Salt Lake City, Utah, or the surrounding area. Salt Lake City is a growing city in need of additional housing. More people come to this beautiful city every year, which reduces the number of available homes and apartment units. Therefore, we will target buyers who are struggling to find affordable housing.

Furthermore, there are thousands of first-time home buyers in the area. These buyers are an ideal target market for the company.

Management Team

Redstone Development will be owned and operated by Jack Grant. He recruited his former administrative assistant, Sheila Johnson, to be his Office Manager and help manage the office and operations.

Jack has over 30 years of experience developing residential properties and worked for several of our competitors. He also holds a Master’s in Real Estate Development from the University of Utah. His education, experience, and industry connections will ensure that Redstone Development becomes one of the area’s most successful real estate development businesses.

Sheila Johnson has been Jack Grant’s loyal administrative assistant for over ten years at a former property development firm. Jack relies strongly on Sheila’s diligence, attention to detail, and focus when organizing his clients, schedule, and files. Sheila has worked in the property development industry for so long that she understands all aspects required to run a successful property development company.

Jack will also employ several other full-time and part-time staff to assist with all aspects of running a real estate development business.

Success Factors

Redstone Development will be able to achieve success by offering the following competitive advantages:

  • Location: Redstone Development’s office is near the center of town, in the shopping district of the city. It is visible from the street, where many residents shop for both day-to-day and luxury items.
  • Client-oriented service: Redstone Development will have a full-time assistant with property development experience to keep in contact with clients and answer their everyday questions. Jack realizes the importance of accessibility and will further keep in touch with his clients through monthly newsletters.
  • Management: Jack has been highly successful working in the property development sector. His unique qualifications will serve customers in a much more sophisticated manner than many of Redstone Development’s competitors.
  • Relationships: Having worked and lived in the community his whole life, Jack knows many local leaders, real estate agents, and other influencers in the local property development industry.

Financial Highlights

Redstone Development is seeking $1,000,000 in debt financing to launch its property development business. The funding will be dedicated to purchasing our first property, construction costs, securing the office space, and purchasing office equipment and supplies. Funding will also be dedicated toward six months of overhead costs, including payroll, rent, and marketing costs. The breakout of the funding is below:

  • Office space build-out: $50,000
  • Office equipment, supplies, and materials: $20,000
  • Land purchase and construction expenses: $530,000
  • Six months of overhead expenses (payroll, rent, utilities): $250,000
  • Marketing costs: $50,000
  • Working capital: $100,000

The following graph below outlines the pro forma financial projections for Redstone Development.

property development business plan example uk

Company Overview

Who is redstone development.

Redstone Development is a new property development company located in Salt Lake City, Utah. We focus on residential property development for single-family and multi-family homes. We handle all steps of the property development process, from sourcing the land to selling the finished property. Redstone Development aims to be the most trusted source of affordable housing in the Salt Lake City metro area.

Redstone Development is owned and operated by Jack Grant, who is a real estate development industry veteran and well-versed in the entire property development process. Jack has over 30 years of experience developing residential properties and holds a Master’s in Real Estate Development. His education, experience, and industry connections will ensure that Redstone Development becomes one of the area’s most successful property development businesses.

Redstone Development’s History

After 30 years of working in the property development industry, Jack Grant began researching what it would take to create his own property development company. This included a thorough analysis of the costs, market, demographics, and competition. Jack has compiled enough information to develop his business plan and approach investors.

Once his market analysis was complete, Jack began surveying the local office spaces available and located an ideal location for the property development headquarters. Jack incorporated Redstone Development as a Limited Liability Corporation on October 1st, 2022.

Once the lease is finalized on the office space, renovations can be completed to make the office a welcoming environment to meet with clients.

Since incorporation, Redstone Development has achieved the following milestones:

  • Located available office space for rent that is ideal for meeting with clients
  • Identified the first property to develop
  • Developed the company’s name, logo, and website
  • Hired an interior designer for the decor and furniture layout
  • Determined equipment and fixture requirements
  • Began recruiting key employees

Redstone Development’s Services

Redstone Development will handle the entire property development process, including sourcing land, securing all necessary approvals and permits, construction, and sale of the finished property.

Industry Analysis

The real estate and property development industries have been strong over the past few years. As of 2021, the real estate industry was valued at $3.69 trillion and is expected to grow at a compound annual growth rate of 5.2% from now until 2030.

This growth will be driven by increasing demand for personal housing. Millennials and Gen-Z are beginning to rent their first apartments or buy their first homes. After years of living with family or roommates, they are ready to have a space to call their own. This trend is leading to a substantial demand for housing that many cities are struggling to supply.

The main challenge to the property development industry is the decrease in market size in the land development industry. Over the past five years, the industry saw an average annual decline of 0.7%. However, we believe that the pandemic was a considerable factor in this decline. Currently, the land development market is valued at $12 billion USD, and we expect it to grow substantially due to the growth of similar industries and the increasing demand for housing, as mentioned above.

Customer Analysis

Demographic profile of target market.

Redstone Development will serve home buyers and real estate investors in Salt Lake City, Utah, and its surrounding areas.

The community of Salt Lake City has thousands of first-time home buyers, residential real estate investment firms, and people looking for affordable housing options in the area. The company will also target millennials specifically since the majority of first-time home buyers are in this age group.

The precise demographics for Salt Lake City, Utah are:

Customer Segmentation

Redstone Development will primarily target the following customer profiles:

  • Home buyers
  • Real estate investors
  • Millennials
  • Apartment/Condominium management companies

Competitive Analysis

Direct and indirect competitors.

Redstone Development will face competition from other companies with similar business profiles. A description of each competitor company is below.

Upscale Property Developers, Inc.

Upscale Property Developers, Inc. is a property development company in Salt Lake City. In business for over 40 years, Upscale Property Developers, Inc. provides oversight for the entire property development process for new single-family and multi-family residences, commercial offices, and government buildings across the area. Upscale Property Developers, Inc also offers a variety of property renovation, demolition, and revitalization services for existing buildings.

Although Upscale Property Developers, Inc. provides homes with a luxury aesthetic, they are also the most expensive property developments on the market, thus resulting in many first-time home buyers being priced out of the market.

Premium Property Development Solutions

Established in 1990, Premium Property Development Solutions is a property developer of new commercial and residential properties in Salt Lake City. The company specializes in eco-friendly building materials and upscale design options for individual and corporate clients. Clients can customize their building design or choose from a variety of standard design options. The company employs experienced property developers and designers who are well-versed in green building design.

Premium Property Development Solutions is more affordable than Upscale Property Developers Inc. but is still out of most first-time home buyers’ price ranges.

Salt Lake Residential

Salt Lake Residential is also a local property development company that manages the complete property development process from sourcing and permitting to construction and sale. They are mostly known for their unique apartment complex designs but are equipped to take on a variety of different builds. The company has been in business for about ten years and has developed a reputation for building quality homes for affordable prices.

Although Salt Lake Residential has a similar value proposition of luxury homes at affordable prices, this company lacks the green building and eco-efficiency component to their business model, thus losing out on business from eco-conscious home buyers.

Competitive Advantage

Redstone Development enjoys several advantages over its competitors. Those advantages include:

  • Location: Redstone Development’s office is near the center of town, in the city’s shopping district. It is visible from the street, where many residents shop for both day-to-day and luxury items.

Marketing Plan

Brand & value proposition.

Redstone Development will offer the following unique value proposition to its clientele:

  • Service built on long-term relationships and personal attention
  • Big-firm expertise in a small-firm environment
  • Client-focused property development, where the company’s interests are aligned with the client
  • Effective project management
  • Affordable pricing

Promotions Strategy

The promotions strategy for Redstone Development is as follows:

Website/SEO

Redstone Development will invest heavily in developing a professional website that displays all of the features and benefits of the property development company. It will also invest heavily in SEO so the brand’s website will appear at the top of search engine results.

Social Media

Redstone Development will invest heavily in a social media advertising campaign. The marketing manager will create the company’s social media accounts and invest in ads on all social media platforms. It will use targeted marketing to appeal to the target demographics.

Print Advertising

The company will invest in professionally designed advertisements to be printed in real estate publications. Redstone Development will also list its properties for sale in key local publications, including newspapers, area magazines, and its own newsletter.

Community Events/Organizations

The company will promote itself by distributing marketing materials and participating in local community events, such as local festivals, business networking, or sporting events.

Redstone Development’s pricing will be moderate so consumers feel they receive great value when purchasing properties from the company.

Operations Plan

The following will be the operations plan for Redstone Development.

Operation Functions:

  • Jack Grant will be the Owner and President of the company. He will oversee all staff and manage client relations. He will also oversee all major aspects of the development projects. Jack has spent the past year recruiting the following staff:
  • Sheila Johnson – Office Manager who will manage the office administration, client files, and accounts payable.
  • Kenneth Bohannon – Staff Accountant will provide all client accounting, tax payments, and monthly financial reporting.
  • Beth Martinez – Marketing Manager who will provide all marketing for Redstone Development and each property it manages.
  • Jack will also hire a team of architects, engineers, interior designers, and contractors to design and build the properties.

Milestones:

The following are a series of steps that lead to our vision of long-term success. Redstone Development expects to achieve the following milestones in the following six months:

1/1/202X         Finalize lease agreement

2/1/202X         Design and build out Redstone Development

3/1/202X         Hire and train initial staff

4/1/202X         Purchase first property for development

5/1/202X         Kickoff of promotional campaign

6/1/202X         Find second property for development

Jack has over 30 years of experience developing residential properties and worked for several of our competitors. He also holds a Master’s in Real Estate Development from the University of Utah. His education, experience, and industry connections will ensure that Redstone Development becomes one of the area’s most successful property development businesses.

Jack will also employ several other full-time and part-time staff to assist with all aspects of running a real estate development business as outlined in the Operations Plan.

Financial Plan

Key revenue & costs.

Redstone Development’s revenues will come primarily from the sale of completed properties. The company will sell new single-family homes, multi-family townhomes, and apartment complexes/condominium properties to individual buyers and investors.

The cost drivers will be the overhead costs required to staff a property development office. The expenses will be the payroll cost, rent, utilities, office supplies, and marketing materials.

Funding Requirements and Use of Funds

Key assumptions.

The following outlines the key assumptions required to achieve the revenue and cost numbers in the financials and to pay off the startup business loan.

  • Average monthly payroll expenses: $50,000
  • Office lease per year: $100,000

Financial Projections

Income statement, balance sheet, cash flow statement, property development business plan faqs, what is a property development business plan.

A property development business plan is a plan to start and/or grow your property development business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can easily complete your Property Development business plan using our Property Development Business Plan Template here .

What are the Main Types of Property Development Businesses?

There are a number of different kinds of property development businesses , some examples include: Single-family detached housing, Multifamily housing, Developing and Subdividing Lots, and Commercial buildings.

How Do You Get Funding for Your Real Estate Development Business Plan?

Property Development businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding. This is true for a real estate developer business plan and a real estate investment business plan template.

What are the Steps To Start a Property Development Business?

Starting a property development business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Write A Property Development Business Plan - The first step in starting a business is to create a detailed real estate development company business plan that outlines all aspects of the venture. This should include market research on the real estate market and potential target market size, information the services you will offer, marketing strategies, pricing details and a solid financial plan.  

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your property development business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your property development business is in compliance with local laws.

3. Register Your Property Development Business - Once you have chosen a legal structure, the next step is to register your property development business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your property development business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Property Development Equipment & Supplies - In order to start your property development business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your property development business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.

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Property Management Business Plan

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People buy multiple properties these days, it can be for investment or to act as a future home, office space, some dream project, or whatnot.

And as they have so many properties, they’ll surely need someone to manage them and deal with all aspects of having a property. Also, most people are running short of time more often than not. Hence, they hire property managers to help them deal with their property efficiently and effectively.

So, it comes as no surprise that the property management business is growing. And if you are planning to get into it, all you need is a few tips and a property management business plan.

If you are planning to start a new property management business, the first thing you will need is a business plan. Use our sample property management business plan  to start writing your business plan in no time.

Before you start writing your business plan for your new property management business, spend as much time as you can reading through some examples of real estate-related business plans .

Industry Overview

The global property management market stood at a whopping market value of 13.88 billion US dollars in 2020 and isn’t going to slow down anytime soon.

The major reason for the growth in this industry is the requirement for mobility management as companies are promoting remote work due to the pandemic.

The other factors that have affected the property market are the adoption of technology, software services, and other such things which have brought about a change in trends in the real estate market.

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property development business plan example uk

Things to Consider Before Writing a Property Management Business Plan

Build relevant skills.

Having skills relevant to your business, be it foundational skills for managing property soft skills for dealing with the people in your business, or the deals and exchanges aspect of your business would always act as an added advantage for you. Hence, before getting started, it would be good to develop some basic skills and have a method to keep updating them as you work. Your skills alone can also become your business’s unique selling point.

Join Associations and Build Your Network

Networking is a crucial aspect in every field related to real estate, hence it is essential for your property management business too. Your network should be good and diverse and consist of a variety of people, even if they are your competitors. You’ll never know who might get you your next deal.

You can easily do so by building strong connections and joining relevant associations which give you more opportunities to network.

Use Technology

We owe the speed and efficiency of our work to technology. The same holds for the property management business too. You no longer need to work traditionally and laboriously of managing your properties, and use technology instead to make your work of maintaining all those details easier and more organized.

Build your Website

Building your website early gives you a head start on promoting your business and makes reaching out to your potential clients easier. Hence, if you plan on starting a business, build your website today to help you promote as much as you can.

Chalking out Your Business Plan

Reading sample business plans will give you a good idea of what you’re aiming for and also it will show you the different sections that different entrepreneurs include and the language they use to write about themselves and their business plans.

We have created this sample property management business plan for you to get a good idea about how perfect a property management business plan should look and what details you will need to include in your stunning business plan.

Property Management Business Plan Outline

This is the standard property management business plan outline which will cover all important sections that you should include in your business plan.

  • Mission statement
  • Vision Statement
  • Customer Focus
  • Success Factors
  • Financial Summary
  • 3 Year profit forecast
  • Business Structure
  • Startup cost
  • Products and services
  • Market Analysis
  • Industry Analysis
  • Market Trends
  • Target Market
  • SWOT Analysis
  • Targeted Cold Calls
  • Online Marketing
  • Publications
  • Community Events/Organizations
  • Pricing Strategy
  • Financial Plan
  • Important Assumptions
  • Brake-even Analysis
  • Profit Yearly
  • Gross Margin Yearly
  • Projected Cash Flow
  • Projected Balance Sheet
  • Business Ratios

After getting started with Upmetrics , you can copy this sample property management business plan into your business plan and modify the required information and download your property management business plan pdf or doc file.

It’s the fastest and easiest way to start writing your business plan.

The Quickest Way to turn a Business Idea into a Business Plan

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Download a sample property management business plan

Need help writing your business plan from scratch? Here you go;  download our free property management business plan pdf  to start.

It’s a modern business plan template specifically designed for your property management business. Use the example business plan as a guide for writing your own.

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Real Estate Development Business Plan Template

Written by Dave Lavinsky

real estate development business plan

Real Estate Development Business Plan

Over the past 20+ years, we have helped over 500 entrepreneurs and business owners create business plans to start and grow their real estate development companies.

If you’re unfamiliar with creating a business plan, you may think creating one will be a time-consuming and frustrating process. For most entrepreneurs it is, but for you, it won’t be since we’re here to help. We have the experience, resources, and knowledge to help you create a great business plan.

In this article, you will learn some background information on why business planning is important. Then, you will learn how to write a real estate development business plan step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What Is a Business Plan?

A business plan provides a snapshot of your real estate development business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategies for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan

If you’re looking to start a real estate development business or grow your existing real estate development company, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your real estate development business to improve your chances of success. Your business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Real Estate Development Businesses

With regards to funding, the main sources of funding for a real estate development business are personal savings, credit cards, bank loans, and angel investors. When it comes to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to ensure that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for real estate development companies.

Finish Your Business Plan Today!

How to write a business plan for a real estate development business.

If you want to start a real estate development business or expand your current one, you need a business plan. The guide below details the necessary information for how to write each essential component of your business plan.

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your executive summary is to quickly engage the reader. Explain to them the kind of real estate development business you are running and the status. For example, are you a startup, do you have a real estate development business that you would like to grow, or are you operating an established real estate business that you would like to sell?

Next, provide an overview of each of the subsequent sections of your plan.

  • Give a brief overview of the real estate development industry.
  • Discuss the type of real estate development business you are operating.
  • Detail your direct competitors. Give an overview of your target market.
  • Provide a snapshot of your marketing strategy. Identify the key members of your management team.
  • Offer an overview of your financial plan.

Company Overview

In your company overview, you will detail the type of real estate development business you are operating.

For example, you might specialize in one of the following types of real estate development businesses:

  • Residential development: developing neighborhoods or communities of houses for residential living purposes.
  • Commercial development: developing commercial properties to sell or lease.
  • Subdivision development: dividing a single piece of land into smaller lots to be developed and/or sold.
  • Industrial development: readying land and facilities for manufacturing, production, and other industrial purposes.
  • Greenfield development: readying undeveloped land for agriculture or leaving as is while holding as an investment.

In addition to explaining the type of real estate development business you will operate, the company description needs to provide background on the business.

Include answers to questions such as:

  • When and why did you start the business?
  • What milestones have you achieved to date? Milestones could include the number of properties developed, generating $X amount in revenue, reaching X number of clients, etc.
  • Your legal business Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry or market analysis, you need to provide an overview of the real estate industry.

industry growth outlook

While this may seem unnecessary, it serves multiple purposes.

First, researching the real estate development industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your marketing strategy, particularly if your analysis identifies market trends.

The third reason is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section:

  • How big is the real estate development industry (in dollars)?
  • Is the market declining or increasing?
  • Who are the key competitors in the market?
  • Who are the key suppliers in the market?
  • What trends are affecting the industry?
  • What is the industry’s growth forecast over the next 5 – 10 years?
  • What is the relevant market size? That is, how big is the potential target market for your real estate development business? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: individuals, schools, families, and corporations.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of real estate development business you operate. Clearly, individuals would respond to different marketing promotions than corporations, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the potential customers you seek to serve.

Psychographic profiles explain the wants and needs of your target customers. The more you can recognize and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other real estate development businesses.

Indirect competitors are other options that customers have to purchase from that aren’t directly competing with your product or service. This includes other types of properties for sale, leasing another facility versus purchasing one from you or hiring an in-house development team.

For each such competitor, provide an overview of their business and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as

  • What types of customers do they serve?
  • What type of real estate development business are they?
  • What is their pricing (premium, low, etc.)?
  • What are they good at?
  • What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

  • Will you make it easier for clients to engage with your business?
  • Will you offer products or services that your competition doesn’t?
  • Will you provide better customer service?
  • Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a real estate development business, your marketing strategy should include the following:

Product : In the product section, you should reiterate the type of real estate development company that you documented in your company overview. Then, detail the specific products or services you will be offering. For example, will you provide renovation services, sell newly developed land, or finance real estate deals?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your plan, you are presenting the products and/or services you offer and their prices.

Place : Place refers to the site of your real estate development company. Document where your company is situated and mention how the site will impact your success. For example, is your real estate development business located in a busy retail district, a business district, a standalone office, or purely online? Discuss how your site might be the ideal location for your customers.

Promotions : The final part of your real estate development marketing plan is where you will document how you will drive potential customers to your location(s). The following are some promotional methods you might consider:

  • Advertise in local papers, radio stations and/or magazines
  • Reach out to websites
  • Distribute flyers
  • Engage in email marketing
  • Advertise on social media platforms
  • Improve the SEO (search engine optimization) on your website for targeted keywords

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your real estate development business, including answering calls, planning and managing projects, billing clients and collecting payments, and scheduling meetings with prospective and current clients.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to sell your X number of properties, or when you hope to reach $X in revenue. It could also be when you expect to expand your real estate development business to a new city.  

Management Team

To demonstrate your real estate development business’ potential to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally, you and/or your team members have direct experience in managing real estate development businesses. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your management team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in managing a real estate development business or successfully running their own real estate company.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet, and cash flow statements.

Income Statement

An income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenue and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you charge a development fee of 5%? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets

Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your real estate development business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a lender writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement

Your cash flow statement will help determine how much money you need to start or grow your business and ensure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

When creating your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a real estate development business:

  • Cost of office equipment and supplies
  • Payroll or salaries paid to staff
  • Business insurance
  • Other start-up expenses (if you’re a new business) like legal expenses, permits, computer software, and equipment

business costs

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your office location lease or a list of previous real estate developments you’ve been involved in.  

Writing a business plan for your real estate development business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will understand the real estate development industry, your competition, and your customers. You will develop a marketing strategy and will understand what it takes to launch and grow a successful real estate development business.  

Real Estate Development Business Plan Template FAQs

What is the easiest way to complete my real estate development business plan.

Growthink's Ultimate Business Plan Template allows you to quickly and easily write your real estate development business plan.

How Do You Start a Real Estate Development Business?

Starting a real estate development business is easy with these 14 steps:

  • Choose the Name for Your Real Estate Development Business
  • Create Your Real Estate Development Business Plan
  • Choose the Legal Structure for Your Real Estate Development Business
  • Secure Startup Funding for Your Real Estate Development Business (If Needed)
  • Secure a Location for Your Business
  • Register Your Real Estate Development Business with the IRS
  • Open a Business Bank Account
  • Get a Business Credit Card
  • Get the Required Business Licenses and Permits
  • Get Business Insurance for Your Real Estate Development Business
  • Buy or Lease the Right Real Estate Development Business Equipment
  • Develop Your Real Estate Development Business Marketing Materials
  • Purchase and Setup the Software Needed to Run Your Real Estate Development Business
  • Open for Business

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By: Author Tony Martins Ajaero

Home » Business Plans » Real Estate Sector

A property development company is a company that is involved in buying land, financing real estate, building, or having builders build and develop projects for commercial purposes.

Property development companies renovate and re-lease existing buildings, purchase raw land, and sell developed land or parcels to others. They are involved in developing a property from beginning to end. A report released by the National Association of REALTORS® shows that over 5.64 million existing homes were sold in 2020.

Also, according to data from the U.S. Census Bureau, 822,000 newly constructed homes were sold in the same year. In 2019, 64.9 percent of families owned their primary residence, according to the Federal Reserve’s Survey of Consumer Finances.

Steps on How to Write a Property Development Business Plan

1. executive summary.

Vintage Group© Property Development Company, Inc. is an American-based and licensed real estate cum property development company. Our head office will be located in a standard and centrally located facility in the heart of New York City, New York.

We will engage in property development projects for a wide range of clients. We will work towards becoming one of the largest property development companies in New York and the whole of the United States of America. Jason Theodora is the founder and CEO of Vintage Group© Property Development Company, Inc.

Company Profile

A. our products and services.

Vintage Group© Property Development Company, Inc. will be involved in;

  • Houses and housing estate developments
  • Apartments and other residential developments
  • Commercial developments
  • Industrial developments
  • Other developments (Investment Properties)
  • Real estate consultancy and advisory services

b. Nature of the Business

Our property development company will operate the partnership business model. We will work with investors who are willing to partner with us to grow their investment portfolios in the real estate market.

c. The Industry

Vintage Group© Property Development Company, Inc. will operate under the real estate sales and brokerage industry.

d. Mission Statement

Our mission is to be at the forefront of buying property and partnering with landowners, then develop a plan for what to build or rebuild on that property. We will bring in investors and predict how much money the new homes or businesses will bring in.

e. Vision Statement

Our vision of to be listed among the top three property development companies in the whole of New York.

f. Our Tagline (Slogan)

Vintage Group© Property Development Company, Inc. – The Genius of Property Development!

g. Legal Structure of the Business (LLC, C Corp, S Corp, LLP)

Vintage Group© Property Development Company, Inc. will be formed as a Limited Liability Partnership (LLP).

h. Our Organizational Structure

  • Chief Executive Officer
  • Project Manager
  • Company’s Lawyer/Secretary
  • Admin and HR Manager
  • Head of Construction and Renovation
  • Business Developer/Sales and Marketing
  • Customer Service Executive/Front Desk Officer

i. Ownership/Shareholder Structure and Board Members

  • Jason Theodora (Owner and Chairman/Chief Executive Officer) 51 Percent Shares
  • Hilary Kings (Board Member) 14 Percent Shares
  • Harrison Williams (Board Member) 10 Percent Shares
  • Rachael Abraham (Board Member) 10 Percent Shares
  • Stella Norman (Board Member and Secretary) 10 Percent Shares.

SWOT Analysis

A. strength.

  • Ideal location for property development (thriving real estate market)
  • Highly experienced and qualified employees and management
  • Access to finance from business partners
  • Robust relations with property owners and properties investment moguls
  • Good returns on investment for investors.

b. Weakness

  • Financial Constraints
  • Our business will be competing with well-established property developers and other home remodeling companies
  • Inability to retain highly experienced and qualified employees longer than we want

c. Opportunities

  • New York is a thriving market for property development companies and the real estate industry.
  • Good support structure for property development companies.

i. How Big is the Industry?

The market size, measured by revenue of the real estate sales and brokerage industry is put at $156.2 billion in 2023 hence it will be safe to safe the industry is amongst the biggest industries in the United States of America.

ii. Is the Industry Growing or Declining?

All available data points to the fact that the real estate and brokerage industry is growing. The market size of the industry is expected to increase 0.4 percent in 2023.

iii. What are the Future Trends in the Industry

The real estate sales and brokerage industry is changing, and players in the industry are improvising. No doubt, technology and climate change (the go green initiative) will change the landscape of the industry going forward.

iv. Are There Existing Niches in the Industry?

No, there are no existing niche ideas when it comes to the property development business. This is because the property development line of business is a subset of the real estate and brokerage industry.

v. Can You Sell a Franchise of your Business in the Future?

Vintage Group© Property Development Company, Inc. has plans to sell franchises in the nearest future and we will target major cities with thriving real estate markets in the United States of America.

  • The arrival of new property development companies within our market space
  • Unfavorable government policy and regulations.
  • Community resistance
  • Liability problems
  • Continuously changing consumer demands especially as it relates to style and design of properties et al.

i. Who are the Major Competitors?

  • New World Development Co. Ltd
  • Wheelock and Company
  • AvalonBay Communities
  • Greystar Real Estate Partners
  • Wood Partners
  • Mill Creek Residential
  • Continental Properties Company, Inc.
  • Trammell Crow Company
  • The JBG Companies
  • Lowe Enterprises
  • Simon Property Group
  • General Growth Properties
  • SITE Centers
  • Kimco Realty Corp
  • Brixmor Property Group
  • Panattoni Development Co.
  • McDonald Development Co.
  • USAA Real Estate Co.
  • LaSalle Investment Management
  • Gibraltar Syndication & Development Company

ii. Is There a Franchise for Property Development Business?

Well, for now, there are no known franchise opportunities in the property development business.

iii. Are There Policies, Regulations, or Zoning Laws Affecting Property Development Business?

Yes, there are county or state regulations and zoning laws for the business. Zoning laws are found in virtually every municipality in the United States, affecting land use, lot size, building heights, density, setbacks, and other aspects of property use.

In addition to that, it is important to state that in the United States, government agencies and departments routinely grant variances to rules and regulations. Often, you only have to fill out a short form. In other cases, your request may have to be publicly heard before your city council, zoning board, or other body. Please check with your zoning or planning department to find out what options are available to you.

Marketing Plan

A. who is your target audience.

i. Age Range

Our target market comprises adults above 18 years old who have the finance to do business with us.

ii. Level of Educational

We don’t have any restriction on the level of education of those we are ready to work with as investors or buyers of the properties we develop.

iii. Income Level

The income level of those we are looking to do business with will be between $70,000 and above $124,000.

iv. Ethnicity

There is no restriction when it comes to the ethnicity of the people we are looking to partner with.

v. Language

There is no restriction when it comes to the language spoken by the people we will partner with.

vi. Geographical Location

Anybody from any geographical location will be welcome to partner with us or do business with our company.

vii. Lifestyle

Vintage Group© Property Development Company, Inc. will not restrict any investor or client from partnering with us or doing business with us based on their lifestyle, culture, or race.

b. Advertising and Promotion Strategies

  • Host Themed Events That Catch Attention.
  • Tap Into Text Marketing.
  • Make Use of Bill Boards.
  • Share Your Events in Local Groups and Pages.
  • Turn Your Social Media Channels into a Resource
  • Develop Your Business Directory Profiles
  • Build Relationships with players in the real estate and brokerage industry.

i. Traditional Marketing Strategies

  • Marketing through Direct Mail.
  • Print Media Marketing – Newspapers & Magazines.
  • Broadcast Marketing -Television & Radio Channels.
  • OOH Marketing – Public Transits like Buses and Trains, Billboards, Street shows, and Cabs.
  • Leverage direct sales, direct mail (postcards, brochures, letters, fliers), tradeshows, print advertising (magazines, newspapers, coupon books, billboards), referral (also known as word-of-mouth marketing), radio, and television.

ii. Digital Marketing Strategies

  • Social Media Marketing Platforms.
  • Influencer Marketing.
  • Email Marketing.
  • Content Marketing.
  • Search Engine Optimization (SEO) Marketing.
  • Affiliate Marketing
  • Mobile Marketing.

iii. Social Media Marketing Plan

  • Start using chatbots.
  • Create a personalized experience for our customers.
  • Create an efficient content marketing strategy.
  • Create a community for our target market and potential target market.
  • Gear up our profiles with a diverse content strategy.
  • Use brand advocates.
  • Create profiles on the relevant social media channels.
  • Run cross-channel campaigns.

c. Pricing Strategy

When working out our pricing strategy, Vintage Group© Property Development Company, Inc. will make sure it covers profits, insurance, premium, license, and economy or value and full package for each property,

In all our pricing strategy will reflect;

  • Cost-Based Pricing
  • Value-Based Pricing
  • Competition-Based Pricing.

Sales and Distribution Plan

A. sales channels.

Our channel sales strategy will involve using partners and third parties—such as referral partners, affiliate partners, strategic alliances in the real estate and brokerage industry, and freelancers to help refer clients to us.

Vintage Group© Property Development Company, Inc. will also leverage the 4 Ps of marketing which are place, price, product, and promotion. By carefully integrating all these marketing strategies into a marketing mix, we can have a visible, in-demand service that is competitively priced and promoted to our customers.

b. Inventory Strategy

The fact that we will need the required building materials means that Vintage Group© Property Development Company, Inc. will operate an inventory strategy that is based on a day-to-day methodology for ordering, maintaining, and processing items in our warehouse. We will develop our strategy with the same thoroughness and attention to detail as we would if we were creating an overall strategy for the business.

c. Payment Options for Customers

Here are the payment options that Vintage Group© Property Development Company, Inc. will make available to her clients;

  • Payment via bank transfer
  • Payment via credit cards
  • Payment via online bank transfer
  • Payment via check
  • Payment via mobile money transfer
  • Payment via bank draft

d. Return Policy, Incentives, and Guarantees

At Vintage Group© Property Development Company, Inc., we develop properties and the nature of products (properties) we offer does not accommodate return policy, but we will guarantee our investors of good returns on their investment (ROI). Our Operating Margin targets for housebuilders across the economic cycle will be placed at 15-20 percent on Gross Development Value (GDV).

e. Customer Support Strategy

Our customer support strategy will involve seeking customers’ feedback. This will help us provide excellent properties, return on investment (ROI) and customer service to all our clients and investors, it will help us understand their needs, experiences, and pain points. We will work with effective CRM software to be able to achieve this.

Operational Plan

Our operational plan will cover capacity planning, location planning, layout planning, quality planning, and methods planning.

Overall, we plan to expand our revenue by 50 percent in the second year and the plan will include a marketing, sales, and operations component. The operations component of the plan would include attracting grants and fundraising strategies that will enable us to boost our properties and service offerings.

a. What Happens During a Typical Day at a Property Development Business?

  • The office is open for the day
  • Documentation and other administrative works are conducted throughout the day
  • Marketers go out in the field to market our properties and services
  • If there is an ongoing property development project, the required team and machinery are sent to the field to carry out the project.
  • The team and machinery return to base (office) after the day’s job
  • Report for the day is written and submitted to the required authority
  • The office is closed for the day.

b. Production Process (If Any)

There is no production process when it comes to the property development business.

c. Service Procedure (If Any)

No, there are no defined service procedures for a property development business.

d. The Supply Chain

Vintage Group© Property Development Company, Inc. will rely on key players in the real estate and brokerage industry to refer business deals to us. So also, we have been able to establish business relationships with wholesale supplies of building materials.

e. Sources of Income

Vintage Group© Property Development Company, Inc. make money from;

Financial Plan

A. amount needed to start your property development company.

Vintage Group© Property Development Company, Inc. would need an estimate of $4.5 million to successfully set up a property development company in the United States of America. Please note that this amount includes the salaries of all our staff for the first month of operation.

b. What are the Cost Involved?

  • Business Registration Fees – $750.
  • Legal expenses for obtaining licenses and permits – $7,300.
  • Marketing, Branding and Promotions – $5,000.
  • Business Consultant Fee – $2,500.
  • Insurance – $5,400.
  • Rent/Lease – $200,000.
  • Other start-up expenses including, commercial satellite TV subscriptions, stationery ($500), and phone and utility deposits ($2,800).
  • Operational Cost (salaries of employees, payments of bills et al) – $100,000
  • Start-up Inventory – $15,000
  • Store Equipment (cash register, security, ventilation, signage) – $4,750
  • Furnishing and Equipping – $80,000
  • Liquid Cash for Execution of Projects: $3.5 million
  • Website: $600
  • Miscellaneous: $2,000

c. Do You Need to Build a Facility? If YES, How Much will it cost?

Vintage Group© Property Development Company, Inc. will not build a new facility; we intend to start with a long-term lease and after 5 years, we will start the process of acquiring our facility.

d. What are the Ongoing Expenses for Running a Property Development Company?

  • Transportation cost
  • Cost of building materials and supplies
  • Utility bills (internet, phone bills, signage and sewage et al)
  • Salaries of employees

e. What is the Average Salary of your Staff? List the Job Position and their proposed salary based on industry rate and your startup capital

  • Chief Executive Officer – $85,000 Per Year
  • Project Manager – $72,000 Per Year
  • Head of Construction and Renovation – $70,000 Per Year
  • Company’s Lawyer/Secretary – $68,000 Per Year
  • Admin and HR Manager – $45,000 Per Year
  • Business Developer/Sales and Marketing – $42,000 Per Year
  • Accountant – $40,000 Per Year
  • Customer Service Executive/Front Desk Officer – $30,000 Per Year.

f. How Do You Get Funding to Start a Property Development Company

  • Raising money from personal savings and sale of personal stocks and properties
  • Raising money from investors and business partners
  • Sell shares to interested investors
  • Applying for a loan from your bank/banks
  • Pitching your business idea and applying for business grants and seed funding from, government, donor organizations, and angel investors
  • Source for soft loans from your family members and your friends.

Financial Projection

A. how much should you charge for your service.

At Vintage Group© Property Development Company, Inc. our fee will be based on the location and type of property we want to develop.

b. Sales Forecast?

  • First Fiscal Year (FY1): $3.5 million
  • Second Fiscal Year (FY2): $5 million
  • Third Fiscal Year (FY3): $9 million

c. Estimated Profit You Will Make a Year?

The ideal profit margin we hope to make at Vintage Group© Property Development Company, Inc. will be between 16 and 20 percent on development costs.

d. Profit Margin of a Property Development Company

Vintage Group© Property Development Company, Inc. will collect developer fees that will range from 5 to 10 percent aside from making profits off every property sold.

Please note in planning our property development project, we will make sure that the bottom line shows a suitable return for the money and effort we put into it.

Growth Plan

A. how do you intend to grow and expand .

Vintage Group© Property Development Company, Inc. will grow our property development company by first opening other offices in key cities in the United States of America within the first five years of establishing the business and then will start selling franchises from the sixth year.

b. Where do you intend to expand to and why? (Geographical locations)

Vintage Group© Property Development Company, Inc. plans to expand first to Los Angeles – California, San Francisco – California, Chicago – Illinois, Washington, D.C., Boston – Massachusetts, Miami – Florida, Seattle – Washington, Dallas – Texas, and Philadelphia – Pennsylvania.

The reason we intend to expand to these geographic locations is the fact that available statistics show that the cities listed above have the highest real estate market in the United States. New York has the highest real estate value in the country at $2.8 trillion.

The founder of Vintage Group© Property Development Company, Inc. plans to exit the business via family succession. We have placed structure and processes in place that will help us achieve our plan of successfully transferring the business from one family member to another and from one generation to another.

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COMMENTS

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