Property development is historically an excellent and proven way to make money, but it is also one of the most complex ways to make money from property. You need to be aware of the risks involved (development finance is not regulated by the Financial Conduct Authority), and understand how to set yourself up for a positive result, if you are new to the process.
The key is understanding how you can achieve success in the current marketplace, which means being aware of the challenges involved. With this in mind, this post will offer a few tips for property developers that should help them achieve success and avoid a few common pitfalls.
The demand for housing is unwavering and the Labour government are keen to fulfil this need, so 2025 could be a good year for smart property developers.
Get the fundamentals right
Staying the right side of the law is an essential in property development. Planning permission, building regulations, environmental and sustainability laws are all vital when planning a ground-up build. Whilst this is not new for 2025, it is a perennial requirement for property developers to get right.
Keep up with market trends
Keeping up with market trends is always important in property development, but especially during changing economic circumstances. Knowledge is power, so it will help if you can commit time to reading about the latest trends and developments.
There are a number of ways that you can educate yourself so that you can make smart decisions, including:
- Blogs
- Podcasts
- Newsletters
- Industry events
- Networking with property experts
Prioritise energy efficiency
One of the most prominent trends in the property market in recent years, and one that shows no sign of slowing, is energy efficiency. Homeowners and renters are becoming increasingly eco-aware and looking for properties that are efficient.
This is helpful in terms of keeping bills down during a time when the cost of energy is a major concern, as well as reducing environmental impact – something people are becoming increasingly passionate about.
Here are a few ways to incorporate energy efficiency into your projects:
- Solar panels
- Ground source heat pumps
- Energy-efficient appliances
- LED lighting
- Double glazing
- Insulation
- Smart thermostats
Labour are pursuing goals for improvements in the energy efficiency of rental property, with a target of achieving grade “C” ratings on Energy Performance Certificates (EPCs) by 2030.
With the residential and professional markets in mind, new build properties that achieve an A-C rating will no doubt be some of the hottest properties and as a result could maximise return on gross development costs.
First time buyers are older now
25 years ago the average first time buyer was 29 years old, but that has risen to 34 years old in 2025, due to the cost of housing. If you are building for this target audience, cost efficiency will be critical to achieving an easily saleable property that still holds a healthy profit for you.
Build with a very practical mindset. Simple lines in layout will be cost efficient and avoid extravagances in finish to keep costs on target. A robust build will reduce snags and re-work.
Commercial property trends
Hybrid working grew from the impact of the Covid-19 pandemic. Flexible office spaces are a practical investment option for businesses, with ready to use spaces pre-furnished with desks, meeting rooms, fitted kitchens and leased fibre lines will hold greater appeal than an empty space that will need fitting out.
Industrial storage is expected to maintain strong levels of demand in 2025. Hardcore surfacing, water and power laid on, robust boundaries and an unrestricted B8 planning use class will give your buyers a great deal of flexibility.
Secure the right financing
Given the size and cost of a ground-up build project, you want to make sure that you secure the right development finance deal. This is why it is worth using the services of specialist mortgage broker, such as Commercial Trust.
Specialist mortgage brokers will work with you to understand your situation and then use their expertise to find the best development finance product from a range of UK lenders.
This will take a huge amount of work off your shoulders, and could save you money.
The work involved in thoroughly searching all available lenders and checking their criteria and interest rates is a very large undertaking. There is also a lot of work to administer a development finance application through to completion, and then arrange all the drawdowns (releases of cash in stages during the build)
This is because one of the first things a lender will do is send a professional surveyor to value the land and advise the lender whether your schedule of works aligns with the loan you are asking for. They will also advise the lender on what they believe the Gross Development Value (GDV) figure should be.
A lender will recharge the cost of the valuation to you. If you approach a lender who has criteria that your project doesn’t fit with, but this comes to light during or after the valuation, you could be out of pocket.
Keep in mind that some brokers charge fees, and you should think carefully before securing debts against your property. Your property may be repossessed if you do not keep up repayments on debt secured on it.
Choose your professionals carefully
You should always perform due diligence and compare your options when it comes to professionals for your project, including architects, contractors, and legal advisors. This is particularly important in the current climate when you want to make sure that every decision is right and you are getting value for your money.
In summary
These are some of the secrets to property development success in 2025. Although this is a complex market to operate in, there are always ways to help achieve success with your property development project. Focusing on the above areas will put you in a strong position to achieve your goals.
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