Gibraltar has a small but very active property market and there are many old houses, flats, shops and buildings in severe need of major restoration work. Whilst most property developers use subcontractors to pursue their developments and restoration work, the truth is that builders themselves can make excellent developers. The art of buying and selling property, becoming a master in property wheeling and dealing, renovating and all that involves property is often learnt by building yourself.
The building trade like any other trade requires skills and apprenticeship which takes a considerable amount of time. But it can be learnt and it certainly pays handsome dividends to those who master this never better said constructive trade. One of the major problems of this trade is labour. Building trade craftsmen can be and are indeed a mercenary lot, and it is easy to overpay for badly executed work. A good way to start if the laws allow you to do so is to hire self-employed labourers and to pay them by the day. In this way you will immediately spot the goods ones and the not so good. You just have to keep the efficient workers and get rid of the lazy ones. The good ones can often recommend some other good professionals and you will end up having a good and reliable team. This is an essential part of the construction business. Before too long you will have bricklayers, plasterers, carpenters, electricians and the whole team. You can also look into the possibility of employing trained workers for the evenings and weekends. These workers are normally employed by large companies and are happy to make some extra money by working part time for you. Building workers have become rather expensive in Gibraltar, normally considerably more costly than across the border, so make sure you pick up the efficient lot. Other good points to bear in mind are your sources of supply. Most well priced outlets building stores are located across the border and VAT is duly paid in situ and recoverable as you export the goods. Customs should be accounted for as well as transport from the warehouse into Gibraltar across the border, plus the simple but relevant paperwork. The correct approach would be to spend time marketing around; Algeciras is much larger than La Linea and could have good options as far as sources of supply are concerned. Do some shopping around is the correct answer. It will pay you back, I guarantee that.
By getting involved in building, one surely learns some very positive aspects of property. Amongst others, one will know how to spot good quality work from not so good quality, ideal cost of work, correct cost of materials and where to get them and very importantly how to hire, manage and organize men to do the perfect job. And if you are good and honest you will be booked months ahead so much is the demand for well priced and timely builders. Another good point to bear in mind is that when you become a builder you will learn how to deal with local planning authorities and departments, public health requirements, and the district surveyors. You will also meet architects, decorators and to some extent most movers and shakers in this highly interesting trade. And by running your own building company you make an extra profit – the one the builder would have made out of you had you subcontracted the job – and you have total control of your project. This is, on its own well worth doing. I personally know, having been a developer for many years, the worst side of property development is the building side because it is virtually impossible to control 100%. As as most developers would agree, more often than not it can end up in nasty fall-outs and having to start looking for a new builder. Another good point is that if you are ever to buy via tender offer for example, you can afford if you are the developer as well as the builder, to pay that little extra and obtain the deal because you count on having more margin to play with. Another formula widely used in most countries is to join forces with a developer and work on a basis that you bear the construction costs whilst the developer supplies the land and planning permission and you agree on the split of future profit according to an agreed formula.
The least you will gain from being a builder is to fully understand the cost of developments and the structure of the business and naturally of buildings. You will gain experience of the cost of land in your area, the amount of time to renovate an old historic building, the extra cost that lack of a proper access may produce and an endless list of things that you would have never come across had you not become a proper builder. Nothing, I am afraid to admit, is easy. Competition out there is fierce to say the very least, and you must be prepared to reduce margins if you are to obtain a large building contract. The hours of a professional builder are long, far too long in some cases, even if the money can be excellent. Sacrifice, dedication and hard work are, let me assure you, the order of the day but to some extent like any other manufacturing trade. And it is not as profitable perhaps as investing your time and money on the lookout for large property deals.