Commercial properties are a great way to make money. Some people may shy away from it due to the amount of money that investors stand to lose.
For those who have an interest in real estate, reference websites that offer information to a investors of all experience levels. You can never overdose on knowledge. Learn everything you can about real estate.
If you are renting out your property, be sure that they are always occupied. Having unoccupied spaces mean that you have to pay for their upkeep. Consider why your property has driven away tenants and try to rectify the situation.
Make sure the property you are interested in has access to utilities. You’ll need to have quick access to water, electricity, gas and the sewer.
Thoroughly tour every potential property. Look into having a professional contractor accompany you as you take a look at the properties you’ve been thinking about purchasing. Make the preliminary proposals, and open the negotiating table. Take your time and really explore your offers before you decide to buy or pass.
If you are writing a letter of intent, take it easy. Go for agreements on the bigger problems at first, then get to the smaller issues later in the negotiations. This will diffuse tension during negotiations and will facilitate compromise on the minor issues.
Commercial Property
You will need to know what you are looking for in a commercial property prior to beginning your search. Write down everything you need in a commercial property, such as number of conference rooms, offices, restrooms and how much square footage.
Emergency maintenance is something you must include on the have to ask sheet. Ask in advance who will be handling any emergencies that arise. Have the phone numbers on speed dial, and know how long it generally takes stuff to get fixed. Ask your landlord about emergency procedures to design the best plan possible to face any emergency.
Dual Agency
Read the fine print about your real estate agent. Some agents work for a dual agency. In this sort of situation, the agency acts as both parts of the transaction. This means that the agent is representing the interests of the lessor and lessee simultaneously. Whenever dual agency is part of a transaction, it must be disclosed to both parties of the transaction. Both sides must also agree to the dual agency.
When obtaining a loan for commercial real estate, it is up to the borrower to directly request an appraisal. The bank won’t accept it as valid. Order your appraisal yourself to ensure that you will be eligible for commercial loans.
If you are novice investor, you should start off with just one single type of investment. Find one property type to focus on and devote your undivided attention to it. It is preferred to excel in one type instead of being mediocre in many types.
Commercial properties can afford you some great tax breaks and benefits upon investing in them. As an investor, you might receive interest deductions as well as depreciation benefits. Yet sometimes investors receive what is called “phantom income”, and this is income which is taxed but isn’t received as cash. You should be mindful of phantom income prior to investing.
Research the company and find out if they care about their customers’ best interests before you commit to working with them. If you don’t do this, you could end up with a bad deal and lose more money as time goes on.
Tax Adviser
Prior to purchasing anything, get together with your tax adviser. A tax adviser will be able to tell you how much the buildings are going to cost you and how much of your income is going to be taxable. An adviser could even help you find an area with lower taxes.
Look at any environmental impacts or prior EPA issues with the property. You are responsible for cleaning up your building from environmental waste. Is the property you’re considering purchasing located in a flood zone? That may not be the wisest choice. If you need information about potential environmental problems in an area, contact local environmental protection or assessment agencies.
Commercial property can make you rich if you know what you are doing. Not only do you have to come up with a large amount of money to use as a down payment, but you also have to put time and energy into researching each investment opportunity. Follow these tips to success.