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Wealthy Way

How To Make Money As A Real Estate Developer

Feb 11, 2024
Explore the realities of earning profits in real estate development and the importance of diversifying income streams. Learn about different ways real estate developers make money, including general contracting and pitching deals to investors. Discover ongoing construction projects, such as luxury homes and flipping properties, as well as plans to build an assisted living facility. Compare the construction, cost, and cash flow of assisted living facilities versus multifamily buildings.
08:16

Podcast summary created with Snipd AI

Quick takeaways

  • New construction assets offer a better chance of maximizing profitability and wealth accumulation.
  • Developers earn acquisition and developer fees, which can be reinvested to increase equity in properties.

Deep dives

The Importance of Building New Construction Assets

In the podcast, the speaker emphasizes the benefits of investing in new construction assets rather than older properties. New constructions have a longer lifetime, which provides more opportunities to generate profit. The speaker explains that when investing in rental properties, the real money is made when the property is sold. They give two examples of how to extract capital from a property: increasing rents and putting additional debt on the property or selling the property after a few years of appreciation. The speaker also mentions the option of refinancing, which can result in a tax-free event. Overall, the key takeaway is that new construction assets offer a better chance of maximizing profitability and wealth accumulation.

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