Both seasoned buyers and first-timers can be intimidated when it comes to investing in commercial real estate. In this article, we’ll briefly provide you with information to ease some of the associated stress.
Before jumping into a commercial real estate venture, you first need to get a lay of the land, meaning you must examine and consider the general level of income in the vicinity, how low or high the unemployment rate is, and what the employment practices of businesses in the area are. Properties situated near hospitals, colleges or large enterprises generally sell more easily and have better resale values.
If you are thinking about investing in commercial real estate, you can qualify for a number of tax breaks. As with a home mortgage, interest paid on a commercial property loan is tax-deductable – as is depreciation.
Rule Number One: Get a pre-approved loan before you even start looking at commercial real estate. Ask fellow investors or friends in-the-know before you choose a lender. It’s important to find a lender who is best suited to your venture. If you take the time to get your ducks in a row now, your transaction will be streamlined later on. It is also very important to understand current zoning and any proposed changes to zoning that may be contemplated by the municipality and impact future value.
After you’ve bought your commercial real estate property, you might have to spend money and time remodeling or making repairs. This might involve simple cosmetic issues, such as rearranging furniture or repainting, or it may involve removing some of the walls in order to get maximum benefit from your space. Even if this takes many hours, don’t throw in the towel – your patience will soon be rewarded by profits.