There is a lot more profits in commercial real estate than residential. Finding good opportunities can be difficult. Here are some suggestions on how you can make the most sense pertaining to the different variables so you may make wise choices in dealing with commercial properties.
Be sure to negotiate on the fact of what you are, the seller or buyer. Make sure you have a voice and that you are offered a reasonable amount of money for the property.
Take photos with a digital camera. Your pictures should portray any damage or defect in the property. Common things you should look for include any cracks or holes in walls, and damages to the carpeting.
A good starting point for people looking to purchase real estate is to go online and scour the treasure trove of beneficial information that can help new investors, as well as seasoned professionals. You can never know too much when it comes to commercial real estate, so never stop looking for ways to obtain more information!
If you are in a situation where you have to choose between two attractive commercial properties, remember that size matters. Getting adequate financing is very important in undertaking an investment that pertains to a ten or twenty unit apartment complex. You may have a better price, figured per unit, on the larger apartment complex than on the smaller one.
Learn to set realistic prices by observing the market. There are many variables that can greatly impact the true value of your lot.
Occupation is the key when you purchase commercial properties for rent. If you have any empty property, then you are responsible for its upkeep and maintenance. If you discover that you have multiple properties that are unoccupied, you should attempt to ascertain the underlying reason. Further action may be required on your part to avoid scaring off potential tenants.
Have property professionally inspected before you decide to put it up for sale. If the inspections turn up any problems, remediate them before listing the property for sale.
If you want to sell a property, advertise it locally and on a wider level too. Many sellers mistakenly assume that their property is only interesting to local buyers. In fact, the interest level can expand far beyond the local scene as private investors expand their interest. These investors are searching for affordable property and may be interested in yours.
Using a checklist is useful when you have multiple properties that you are considering. Take this list with you as a reference when visiting other properties, and use it when speaking with the property owners. You should not have any hangups about letting the owners know that you are still deciding on other properties. It might lead to a better deal.
Plan on doing some improvements to your new commercial space before you can inhabit it. It may simply be cosmetic issues that need addressing, such as a fresh coat of paint or some furniture rearrangement. The change could be significant like moving an entire wall to work with a new floor plan. Negotiate these changes ahead of time with the landlord. He may be willing to share these costs needed in order for you to move in.
There are real estate brokers who deal exclusively with commercial investments. You have a full service broker who works on behalf of both the tenant and landlord, then you have brokers who only work with tenants. Consider hiring a broker who only works with tenants. This type of broker may have more experience with helping tenants successfully enter the commercial real estate market.
Read the disclosures when you’re ready to hire a real estate agent. It is important that you realize that you may be entering a dual agency transaction. Your real estate agency will represent each side of the transaction. In simpler terms, both the landlord and the tenant are simultaneously represented by the agency. Dual agency must be disclosed by both parties and they need to agree to it.
Consider all of the tax benefits when planning on commercial property investment. In addition to depreciation benefits, investors can receive interest deductions. However, investors sometimes receive “phantom income”, which is income that is taxed, but not received as cash. Before you make any investments, be sure you are aware of this kind of investing.
Ask your real estate broker how they measure success and failure to determine if you have hired the correct one. Ask them how they measure their results. Strive to understand the various strategies that they employ. Employ a broker only if his philosophies and approach are similar to yours.
Commercial Real Estate
After reading this article, you should be familiar with commercial real estate basics. Stay flexible and be ready to think on your feet as you navigate the ever-changing commercial real estate market. You will find yourself in a perfect spot, and have access to the best deals on the market.