If you invest in any commercial real estate, you will be able to make a big profit, though you will need to be patient, and do a lot of studying and research. A number of newcomers to commercial real estate investing have successfully learned the ropes and turned a tidy profit. The purpose of this article is to educate you about some of those basics so you too can experience success.
Don’t make any big real estate purchases until you’ve evaluated the unemployment rates, income levels, and expansion rates of the area. Properties that are near major employment centers, such as medical centers or universities, often sell more quickly and at a higher price.
Record problems by taking digital pictures of them. Take pictures of the damages, for instance spots and stains, holes or even discoloration on the bathtub.
There is much more time and work involved in purchasing a commercial property rather than a residential property. The duration and intensity is necessary if your investment is to yield a high return.
When choosing a broker, investigate their years of actual commercial market experience. Don’t use a broker who doesn’t specialize in the type of real estate investment you’re interested in. You need to get into a type of exclusive agreement with your broker.
If your real estate deal includes inspections (and it always should), make sure to ask to see the credentials of all of the inspectors. This should be especially noted for those who work in pest removal since there are actually a number of non-licensed people who work in this area. A non-accredited inspector could be a source of problems.
Commercial Real Estate
Make sure that the advertisements for your commercial real estate reach both local and non-local audiences. A lot of people do not think that people from out of town will want to buy their commercial real estate. Many private investors find it appealing to purchase properties that are affordably priced outside of their direct area.
Keep letters of intent simple by tackling large issues before sweating the small stuff. The initial negotiations will be less tense and the smaller issues will seem less important later.
If you are investigating multiple properties, make sure that you take a site checklist with you. Get the responses from the first round of proposals, but make sure the property owners are aware of this before proceeding. It will likely be to your advantage to informally mention that you are looking at more than one property. It can also get you a great deal on the property you’re touring!
It is essential to develop a list of emergency maintenance service providers. Ask the landlord who handles emergency repairs in your office or building. Know what the phone numbers are, and know what the response time is for them. Create an emergency plan using your landlord’s information so that you can protect customer service and your reputation in case of a disruption to your usual business.
In commercial real estate, there are different kind of brokers. Some brokers represent tenants only, while full service brokers will work with landlords and 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 of the real estate agent you are planning to hire. Watch for possible dual agency. If so, the agent will represent both sides. In other words, the agent is representing both you and your landlord in the same transaction. Real estate agents must disclose any dual agency. Both the tenant and the landlord must agree to accept dual agency.
If you take the time to read through and start applying the advice that you have read, you will start off on the right foot with real estate investing. Anyone who knows how to buy and sell commercial real estate can earn a handsome profit. If you experiment with the tips you just read about, you can start making money through real estate investments.