Lecture 8B Ever wonder how successful builders become wealthy? Watch this development case Study

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Cost Control is often associated with the direct costs of building a project. Cost control is also related to decisions that are made about a development and how well those decisions are executed. Developers have limited capital and they have to choose where to invest and what will give them the biggest return on their investment (ROI). ROI is different than profit and different projects can provide significant differences in ROI, profit, and risk. This lecture provides examples of developer projects and compares them based on 1 spec. home taking 1 year, 1 spec. home taking 18 months and constructing two spec. homes in 1 year.
This lecture also discusses the impacts of interest rates, inflation, and boom bust cycles, compounding, present value, future value of money and their effects on development projects and why effective cost control is an important element in this process.
Note: Spec. means building on the speculation that you can sell this project at a certain price.
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