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How to Spot a Good Property Development

A good property development is not simply a building with potential. It is a site where the planning route looks realistic, the numbers can absorb some pressure, the end demand is there, and you still have more than one sensible exit if the market shifts.

How to Spot a Good Property Development | Busk Properties

This is where people often get confused. A tired building, a large plot, or a low guide price can look exciting but that does not automatically make it a good development. The better question is whether the opportunity still stands up once you have interrogated the planning, the viability, the demand and the risk.

In this article, I want to look at where to find development opportunities, how to interrogate the information you have before you commit too much time, and what factors should lead you towards doing a viewing.

What makes a good property development?

To me, a good development is not the one with the loudest sales pitch. It is the one that still looks sensible after you start asking four harder questions.

01
Believable planning route
A realistic path to consent, not wishful thinking.
02
Numbers with margin
Works under pressure, not just in the best case.
03
Real end demand
A defined market for the finished product.
04
Exit flexibility
More than one sensible route if the market shifts.

That is the starting point. Everything else sits underneath it.

Where to look for opportunities

Not every opportunity comes from the obvious listing portals. Estate agents, auction catalogues and commercial property portals still matter, but some of the better opportunities sit in places the wider market is not reading properly. That might be vacant upper floors above shops, underused offices, mixed-use buildings, small infill plots or sites with previous planning history that still tells a useful story.

The question I would ask is not just, "What is for sale?" it is "What is being misunderstood?"

A planning portal can be as useful as a sales portal. A refusal is not always the end of the story. Sometimes it shows you exactly what the local authority objected to, what they might support, and whether the idea failed because the scheme was wrong or because the approach was.

WHERE TO LOOK FOR DEVELOPMENT OPPORTUNITIES Estate Agents & Auctions Planning Portals Commercial Portals VACANT Vacant Upper Floors Mixed-Use Buildings ? Infill Plots & Misunderstood Sites

How to interrogate the information before viewing

Before arranging a viewing, apply a simple desktop filter. That stops you wasting time on sites that sound interesting but do not really stand up.

1

Check whether there is a believable planning story

Start with the local plan, planning history, access position, neighbouring uses and any visible constraints. The real question is whether you can explain clearly why this scheme should get consent here. If you cannot answer that in plain English, you are not ready to assume the opportunity stacks up.

2

Build a rough viability appraisal

You do not need a perfect appraisal at first pass, but you do need a realistic one. Test purchase price, acquisition costs, build cost, abnormal costs, fees, finance, contingency, programme length and likely end value. A good development should still look acceptable if costs rise, values soften or timing slips.

3

Check whether there is real demand for the finished product

Do not just ask whether housing is in demand generally. Ask who would actually buy or rent what you plan to create. A one-bed town-centre flat, a family house and a downsizer product are three different markets. Look at what is already selling nearby, by type and size, and whether your assumed values are genuinely supported.

4

Look for hidden friction

Some sites do not fail because the idea is wrong. They fail because the friction was underestimated. That friction might be access, retaining works, flood risk, servicing constraints, rights of way, contamination, title complications or neighbour sensitivity. You need to know what could become expensive, slow or awkward.

5

Decide whether the site has earned a viewing

A viewing should not be the first step. It should be the next step once the desktop work has earned it. If the planning angle makes sense, the early numbers show enough room in the deal, and there are important questions only a site visit can answer that is the point where a viewing becomes worthwhile.

THE 5-STEP DESKTOP FILTER — BEFORE YOU VIEW 1 Planning Planning Story 2 Viability Viability Check 3 Demand End Demand 4 Friction Hidden Friction 5 Decision Earned a Viewing? BOOK THE VIEWING Desktop work has earned it Only when all five steps pass

Current market influences that matter

A good development has to work in the market you are in, not the market you wish you had.

Finance costs still matter. Buyer affordability still matters. Build costs, programme delays and planning risk all matter. In a more selective market, marginal schemes tend to get exposed more quickly.

This is why I would rather back a simpler site with a clear planning route and a resilient end market than a more exciting site that only works on optimistic assumptions. A good scheme should still work when conditions are tighter, timings are slower or buyers are more cautious.

CURRENT MARKET INFLUENCES ON DEVELOPMENT YOUR SCHEME must survive all Finance Costs Higher rates squeeze development margins. Buyer Affordability End values depend on who can actually buy. Build Costs Materials & labour pressure remains. Programme Delays Longer timelines raise finance exposure. Planning Risk Exit Route Depth

What would make me go and view?

I would usually move to a viewing when three things are true.

First, there is a planning angle I can explain with some confidence. Second, the early numbers suggest enough room in the deal. Third, there are key questions that can only really be answered on site.That might be levels, access, street feel, condition, neighbouring uses, light, layout potential or whether the building feels better or worse in person than it does on paper.

A viewing is worthwhile when it is likely to answer important unknowns.

Red flags that should slow you down

  • The planning case depends on optimism rather than evidence.
  • The numbers only work at full value and minimum cost.
  • The site has one narrow exit route.
  • Access, title, servicing or abnormal costs are still unclear.

Those are the differences between an interesting site and a genuinely good development.

Final thought

"A good property development is usually not the one with the biggest story around it. It is the one that still looks good after you interrogate the planning, the numbers, the demand and the risk."

Before you book a viewing, ask yourself whether you have enough evidence to believe this could become a viable scheme or whether you are simply reacting to potential. Because a good development should get stronger as you investigate it, not weaker.

Looking at a potential development opportunity?

If you want to embark on property development but are nervous about the level of your understanding before committing to financing a deal, get in touch with Busk Properties to ask about our Earn and Learn opportunity.

Frequently asked questions

A good development opportunity is one where the planning route is realistic, the numbers work with some margin for error, demand for the finished product is clear and the site does not come with risks that are likely to undermine the scheme.
You can start with estate agents, auctions and commercial property portals, but it is also worth reviewing planning portals, vacant upper floors, underused offices, mixed-use buildings, infill plots and sites with planning history that may still hold value.
Planning history can tell you a great deal about whether the local authority is likely to support a scheme, what objections have already been raised and whether the opportunity is genuinely promising or simply being marketed as such.
A site is usually worth viewing once you can see a believable planning angle, the early numbers suggest enough margin in the deal and there are key issues that can only be properly understood in person, such as access, condition, levels, light or neighbouring uses.
The main influences are finance costs, buyer affordability, planning risk, build cost pressure, programme length and how easy it is to exit the scheme if the market becomes more selective.
Weak planning prospects, over-optimistic values, understated build costs, unresolved access issues, legal complications, hidden abnormal costs and a deal that only works on one narrow exit route are all warning signs.