Commercial real estate is accessible to anyone. You need to have a basic knowledge base in place before you start to do anything involving investing in actual property. Read this article to find out more about common tricks and mistakes you should avoid to become a successful investor.
Take digital photographs of the unit. Be sure the photos capture any defects that exist in the unit, such as holes in the wall, and damaged or dirty carpets.
Pest Control
You should know what kind of pest control services are available to you when renting or leasing. Especially when you rent in an area known to be infested by bugs or rodents, ask your rental agent about pest control policies.
Websites with abundant real estate investment information are worthwhile references for novices and experienced investors. Having a great base of knowledge will give you the tools to complete every part of the buying process with confidence, leading to solid decision making.
When choosing brokers with whom to work, find out the amount of experience they have dealing with commercial properties. Be sure that they specialize in the area that you are buying or selling in. Entering into an exclusive contract with that particular broker is a good idea.
When starting out in commercial real estate, it is important you understand the measurement labeled Net Operating Income, or NOI for short. Having positive numbers is the only way to ensure success.
Search for buildings that are simply designed and constructed if you’re planning on renting out commercial property. A well-built building will attract tenants quickly because tenants want a property that is solid. This type of property will also make maintenance much easier on both you and your tenant.
Be certain the commercial property you are considering has good utilities access. Your business has its own utility needs, but you are most likely going to need water, sewer, electric and possibly even gas.
Aim to avoid default before you sign a real estate lease. If you are able to successfully do this, you’ll find that your probability of having the tenant within the building defaulting will be low. This type of situation is considered very undesirable.
Be sure to have a professional building inspector go through your property before you put it up for sale. This way you can make sure it is prepared in advance of a sale, and if any problems arise during the inspection you can take care of it on the front end.
Take a look around properties you are interested in. Definitely consider having a professional contractor go with you when looking at potential properties. Decide on an initial offer and start negotiations. Give a bit of thought to the counteroffers before deciding to accept the offer, make a counteroffer yourself or walk away.
If you are viewing more than one property, you may wish to create a checklist for each site. Take initial personal responses, but don’t go further without the property owner knowing. You should feel free to let owners know that this isn’t the only property you’re looking at. You might score a more reasonable deal that way.
Make sure you know who does emergency maintenance work if you rent commercial property for your business. One way to develop such a list is to ask current commercial investors who they use in the event of an emergency repair. Have the phone numbers on speed dial, and know how long it generally takes stuff to get fixed. Take advantage of this information to devise a contingency plan in order to prevent and respond to customer complaints resulting from maintenance issues.
There isn’t just one type of broker for commercial real estate. For example, full-service brokers represent both the landlord and tenants. There are also tenant brokers that work exclusively for the tenants. Consider hiring a tenant-only broker as he’ll have the most experience in dealing with situations such as yours.
Be sure to deal with a company where customer care is important prior to buying. Otherwise, you could end up having costly, but avoidable, consequences from your deal.
As stated earlier, successful real estate investments require extensive knowledge about the market and its operations. The purpose of the article was to give you information to help you on your quest for success with commercial real estate.