What’s the Difference Between a Real Estate Investor and a Developer?

June 16, 2025 | Kristi Kandel

ASK:

Can I do both? Invest in real estate and develop new projects?

ANSWER:

Yes, you absolutely can, and many locals do. In fact, combining investing and development is one of the smartest ways to build both momentum and stability in your real estate journey.

If you've bought a rental or flipped a property, you're already an investor. And that cash flow you're earning? It can become the fuel for your first development projects. 

At Local Real Estate Developer (LRED), we see this path all the time: someone starts by investing in existing properties to build income, relationships, and local knowledge. Then they confidently use what they've learned about the market to level-up and transform vacant lots, adapt old buildings, or build something new that their community actually needs. 

The two roles complement each other: 

• Investors buy, hold, flip or reposition existing assets to generate income and build equity. 
• Developers create new value from the ground up or through adaptive reuse. 

Doing both means you're creating opportunity and mitigating risk by pairing long-term cash flow with bigger vision projects. 

KEY TAKEAWAYS:

• You don't have to choose between investing and developing. Many locals successfully do both. 
• Cash flow from investing can support your development goals.
• Investors work with what exists; developers create what's missing. 
• Development engineers value that you don't get from buying & selling assets. 
• LRED gives you the tools, structure, and confidence to grow from one role into the other. 

PEOPLE ALSO ASK:

Can I be both an investor and a developer?

• Yes, many locals start as real estate investors and eventually become developers. At Local Real Estate Developer (LRED), we help you build the skills to move between both roles based on your goals and resources. 

How does investing support development?

• Investing creates steady cash flow, equity, and experience. All of that can be leveraged to help fund, finance, or de-risk your first development deal.

How do developers work with investors?

• Developers often partner with investors to fund their projects. At Local Real Estate Developer (LRED), we teach you how to structure win-win partnerships that get deals done, and build trust along the way. 

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