The Difference Between Home Builders and Real Estate Developers – Adelaide Custom Builder

If you’ve ever been looking for a house before, you’d know that there are plenty of options that you can choose. Two of the options that are there for you are home builders and real estate developers. While you can choose either one, we know that you can’t help but wonder what the difference is between these two professionals. An Adelaide custom builder is someone who builds custom homes, while real estate developers tend to develop an already existing property. To make sure you understand what these two are, we’ve dedicated this article into explaining the differences and similarities of a home builder and a RE developer.

Home Builders and Real Estate Developers – What’s the difference?

A home builder is someone who takes an existing piece of land and builds a structure on it. He can also take an existing structure and update or remodel it. Here are the things that a builder can do:

  • Builds a structure on a property that has just been bought or already own by his client.
  • Transforms an already existing structure owned by the client.
  • Purchases subdivided lots, builds a structure on them, and sells them to potential clients (see “display home”).

 

These are the things that a typical Adelaide custom builder does.

 

A real estate developer, on the other hand, has the same concept and goal as a builder. However, developers don’t transform a property like what builders do. Instead, they quote-and-quote, ‘develop’ it by adding value to the property. This professional takes an idea he has for a particular property and develops it into a project.

 

Here are the things that a Developer Does:

  • Searches for a property that meets with his general requirements.
  • Formulates ideas that he believes will increase the value of the property (e.g., houses, condominiums, commercial buildings/properties, apartments, industrial establishments, etc.)
  • Does research and analysis on the project at hand.
  • Finds potential investors and convinces them to invest money on his project.
  • Purchases the property via cash or financial mortgage from a bank.
  • Gets the right plans made by the right people (engineers, architects, surveyors) to give some substance to his project.
  • Obtains city approval to allow him to carry out the project.
  • Sells his project to one or multiple builders

 

So as you can see, both home builders and real estate developers do have their commonalities and differences. But at the end of the day, it’s all up to you to decide if you’ll go for an Adelaide custom builder or a RE developer. Choose wisely.