How to Get into Property Development in the UK?


The property market in the UK has been at its peak for a few years, which is encouraging the interest of most people to get into property development. The property market is quite lucrative and monetarily rewarding as well.

However, you need to have appropriate information before you step into the most successful market in the world. The two significant incentives that tempt you towards property development are:

  • First, generate Revenue- You can withhold the selling of your property and rent it, further receiving revenue from the tenants.
  • Capital Appreciation- There can be an increase in the value of your property holdings over time. Thus, you can witness substantial profits when you sell the property as a whole or a part of it.

There are a lot of individuals who are curious to know how to get into property development in the UK? As a property developer, you must have an eye for opportunities and instincts to spot the potential property that can bring greater benefits.

Furthermore, quality contractors and budgeting are a must for a better profit margin and experience in property development. So let’s discuss the various ways through which you can get into property development and obtain good capital from the same.

A Helpful Guide to entering the world of property development

A helpful guide to entering the world of Property Development

  • Before entering the property development market, we must decide how to operate in the field. A person can be a sole trader, operate in a business partnership, or as a limited company.
  • All these have their advantages and disadvantages, and only after carefully weighing them against one another can we decide which is best suited for the job.
  • One of the major drawbacks of operating as a sole trader is that they tend to become liable for capital gains tax; not only that, the sole burden of all other taxes on the profit falls on the single trader.
  • In simple words, it means we pay more tax than those operating as a business. Thus, the most effective way to invest in and develop a property in the UK is to set up a specific company. It will prove to be more tax-efficient as well.
  • Another means of property development is slowly catching on in the UK. It is setting up SPV or Special Purpose Vehicle Company.
  • The key difference between a limited company and SPV is that in the case of LTDs, even after being liable for usual rates of corporation tax and having the inability to write off some unnecessary expenses or deductibles, they have the advantage of other activities as a business.
  • While for an SPV, a company is set up solely for property development, this tends to have higher tax benefits for investors and developers. SPVs can also help reduce the tax bill to a great extent.
  • But all these are methods for when we have a sufficient supply of capital either from investors or our savings. But this does not mean people with no money cannot engage in property development.
  • A major portion of property development depends on choosing the correct location and extracting the maximum benefit from the limited budget.
  • Truly passionate developers may choose to get a 100% loan for investing and developing their property; however, getting such a huge loan is quite difficult without proper plans.

Now that we have learned how to enter this lucrative market, we must know exactly what this job as a developer entails.

Summarizing the tasks of property development

Summarizing the Tasks of Property Development

  • Choosing a suitable property to invest in, for example, getting a good price for a house whose value depreciated due to low maintenance, can be considered a good investment for the developer.
  • While looking for a house to rent out and generate revenue, one must find out the rent of other houses in the area, the different property prices of the region, transport availability, and look for all the other facilities that attract tenants.
  • The second most important task is to gauge the amount of work undertaken and how much has to be spent on that.
  • Once our property development is completed, we can choose to sell it or rent it out.

After reviewing all these points, it has now become clear why this profession attracts the attention of many to summarise

Advantages of being a property developer

Advantages of Being a Property Developer

1. Lucrative business

Although risky, if the property is acquired with proper strategy and skill over the years, it can bring extensive profit for the trader or the small business. On top of it, if, instead of selling the property, one decides to rent it out, they will have valuable assets in their name and get regular revenue from it.

2. Trade for the underqualified

One of the major pulls of this market is that no special qualifications are required. It only requires patience, determination, hard work, and resilience. Even if we cannot do the entire work on our own, we can easily source from contractors. But a certain level of skill and candor is required.

But looking at the bright side is not always wise, so here is some backside to the seemingly profitable business.

Disadvantages of being a property developer

  1. Highly risky, especially for the novice or the inexperienced. Matching the various deadlines and understanding the intricate budgets is no joke.
  2. Highly stressful, keeping up with the fluctuating property market and calculating every step to maximize profit can be hard on our health. Thus, this life of anticipation and calculation is not for the faint-hearted.

An estimate of the income of UK based property developers

Although the number varies from project to project, all the developers aim to get at least a 25% return on the cost the project was initially sold. Some developers can accumulate an income of 6 figures after a few years of hard work.


No job is easy, and hence even when becoming a property developer looks like a risky course of action, one must not overlook the vast field of benefits it can create. Thus like all other forms of trade, this too can be mastered with proper guidance, determination, and skill.

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