How soon the confession is done depends on the type of story you want to tell. Do you want the focus more on the growing friendship or the romance? Either way could work.

Similarly, how someone confesses their feelings depends on the people involved and their circumstances. There are a million ways a confession can be done, but you have to find the way that is the best fit for your story and characters.

I think the main questions to ask yourself are: What benefits your story most? What is most interesting to you?