What Is the First Step in Real Estate Development?

May 4, 2026 | Kristi Kandel

ASK:

If I had to reduce development to one starting action, what would it be?

ANSWER:

The first real step is choosing a target and studying it deeply.

Development is hyper local. You cannot master every neighborhood and every product type at once.

Pick one:

• One neighborhood
• One product type
• One price range

Then study everything happening there.

Study Existing Projects

Look at:

• What is currently under construction?
• What recently sold?
• What is sitting unsold?
• What rents are actually being achieved?

Markets leave clues.

Study Zoning and Land Use

Understand:

• Density limits
• Height restrictions
• Setbacks
• Parking requirements

Knowing zoning early prevents wasted time.

Study Construction Costs

Talk to contractors. Ask:

• What is cost per square foot locally?
• What are common overruns?
• What trades are backed up?

Specific knowledge beats broad ambition.

When you know one area deeply, your decision making improves dramatically.

KEY TAKEAWAYS:

• Focus on one niche before expanding.
• Study what is already working.
• Specific knowledge reduces risk.

PEOPLE ALSO ASK:

Can I change markets later?

Yes, but ideally after you’ve gone deep in a market and built a solid team.

Should I follow trends or fundamentals?

Follow fundamentals like demand, vacancy, and pricing stability.

What if my market feels saturated?

Look closer. Saturation often hides underserved niches.

Unlock more tools, templates & case studies in the Developer Vault.

SHARE THIS