Property Development 101
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Questions and Answers

What is the primary focus of the fourth instalment of the series on development?

  • The steps involved in the development journey (correct)
  • The role of property managers in development
  • The benefits of passive property investment
  • The importance of soil quality in development

What is required for new builds besides the initial planning stage?

  • Extensive legwork and preparation (correct)
  • Minimal legwork and preparation
  • No preparation at all
  • Only site preparation

What is essential for a property developer to achieve success?

  • Ignoring potential problems
  • Following a rigid plan
  • Having a single, fixed timeline
  • Remaining flexible and adaptable (correct)

What is the general flow of the development process?

<p>Rarely completely linear (A)</p> Signup and view all the answers

Why is it essential to manage all aspects of development carefully?

<p>Because of the high cost of making a mistake (D)</p> Signup and view all the answers

What is a key aspect of the development process?

<p>The ability to reposition or renegotiate (A)</p> Signup and view all the answers

What is involved in the development process?

<p>Multiple, complementary stages (C)</p> Signup and view all the answers

Why is flexibility crucial in property development?

<p>Because plans can go awry at any point (A)</p> Signup and view all the answers

What is the general outcome of not managing development aspects carefully?

<p>An extraordinarily costly mistake (D)</p> Signup and view all the answers

What is the relationship between time and property development?

<p>Property development involves extensive timeframes (B)</p> Signup and view all the answers

What is the role of a surveyor and town planner in the development process?

<p>To ensure compliance with rules and regulations (C)</p> Signup and view all the answers

How long may it take to receive Development Approval?

<p>6-12 months (D)</p> Signup and view all the answers

What is the purpose of working drawings and documentation?

<p>To obtain a building permit or Construction Certificate (A)</p> Signup and view all the answers

During which stage do you acquire quotes from prospective builders?

<p>Pre-construction (B)</p> Signup and view all the answers

What is a crucial aspect of being a successful developer in property development?

<p>Being able to handle and thrive under intense pressure and uncertainty (C)</p> Signup and view all the answers

How is the builder paid during the construction stage?

<p>Progressively at the completion of each stage (D)</p> Signup and view all the answers

What is the primary purpose of the pre-purchase stage in property development?

<p>To seek out a block of land or an established house site with development potential (C)</p> Signup and view all the answers

What is the recommended strategy for growing your property portfolio?

<p>Retaining developments as part of your high-growth portfolio (D)</p> Signup and view all the answers

What is the importance of having a team of consultants during the pre-purchase stage?

<p>To assess the viability of the project and provide advice (D)</p> Signup and view all the answers

What happens during the completion stage of the development process?

<p>The project is leased or sold (A)</p> Signup and view all the answers

What should be considered when assessing the market demand in the chosen area?

<p>The type of dwelling that would sell or lease well (C)</p> Signup and view all the answers

How long can the construction stage take?

<p>Depending on the size of the project, between 6 and 12 months (C)</p> Signup and view all the answers

What is the purpose of a pre-purchase feasibility assessment?

<p>To assess the viability of the project and determine the land's worth (C)</p> Signup and view all the answers

What is the purpose of the pre-construction stage?

<p>To acquire quotes from prospective builders and secure bank approval (B)</p> Signup and view all the answers

What is the primary focus of the concept stage in property development?

<p>Coming up with a concept for the project (D)</p> Signup and view all the answers

How long can the working drawing and documentation stage take?

<p>3-4 months (D)</p> Signup and view all the answers

What is an important consideration when designing a project during the concept stage?

<p>Maintaining the traditional nature of the area (C)</p> Signup and view all the answers

What should be included in a pre-purchase feasibility assessment?

<p>All costs including consultants and construction, as well as likely end sale values (D)</p> Signup and view all the answers

What is the primary purpose of the purchase stage in property development?

<p>To buy the land at a price that allows for commercial profit (D)</p> Signup and view all the answers

What is the role of the architect during the town planning stage?

<p>To draw up plans that fit in with the relevant state planning codes (A)</p> Signup and view all the answers

Study Notes

Property Development Process

  • The property development process involves 8 stages: pre-purchase, concept, purchase, town planning, working drawing and documentation, pre-construction, construction, and completion.

Pre-Purchase Stage

  • Involves seeking out a block of land or an established house site with development potential.
  • Important to have finance in place or know borrowing capacity to determine what can be developed on the site.
  • A team of consultants, including a development manager, solicitor, architect, surveyor, town planner, and estate agent, should be organized to advise on project viability.

Concept Stage

  • Involves assessing the local council's development and planning policies to determine what can be constructed on the site.
  • Market demand in the chosen area should be gauged to design and build a project with optimal marketability.
  • Neighbourhood character and local council's town planning requirements and regulations should be considered.
  • Sketches of the proposed site should be created, considering setbacks, driveways, private open space, garages, and parking spaces.

Purchase Stage

  • Involves buying the land at a price that allows for a commercial profit.
  • A pre-purchase feasibility assessment, including time scales, costs, and end sale values, should be conducted to determine the land's worth.

Town Planning Stage

  • Involves drawing up plans that fit with relevant state planning codes and local council development guidelines.
  • A surveyor and town planner are typically involved at this stage.
  • Development Approval can take up to 12 months.

Working Drawing and Documentation Stage

  • Once Development Approval is received, the architect and engineer document working drawings to obtain a building permit or Construction Certificate.
  • This stage can take about three to four months.

Pre-Construction Stage

  • Involves acquiring quotes from builders and obtaining bank approval for the development loan.

Construction Stage

  • Involves building the project, paying the builder progressively at each stage using drawdowns from the bank loan.
  • This stage can last between six and twelve months, depending on the project size.

Completion Stage

  • Involves leasing or selling the completed project.
  • Retaining the development as an addition to a high-growth portfolio and borrowing against its end value can help grow a portfolio and wealth over the long term.

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Learn about the property development process from start to finish. Understand the stages involved and the legwork required to succeed in the industry.

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