Guide To Investing In A Commercial Property

  • Parker Miller
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  • March 4, 2016
  • surrey-cloverdale-langley-600x300People planning of investing in a commercial property need to take in to consideration a lot of thing. It is not an easy business to get in to a commercial property. Commercial investors need to consider a lot of thing form business point of view before buying a property. Investing a commercial area is also very risky as compared to a residential area. Smart investors do not divide the two types of property. They look at the prospects of benefit a property can render them. There are quite a few benefits of investing in a commercial property, despite the risks involved.

    Choose-Commercial-Or-Residential-Property-InvestmentsHigher ROI cannot be denied in case of a commercial property. A commercial property can yield as high as 8% to 12% of return. Longer leases are available for commercial properties. Commercial tenancy can be up to 10 years where as for a residential property the tenure is mere 6 months to 12 months. Tenants tend to give more time, if the capital is invested for customizing the property. You will be free from paying any other rates or outgoings. In case of a residential property you will have to pay water bills, electricity bills etc.

    In case of a commercial property, commercial tenants will pay this for you. The prices of commercial properties are lower than that of residential properties. Smaller deposits at a time will do the work on time. The commercial properties are sensitive to market conditions. The business might fail in the years of economic downturn. This is not the risk when it comes to a residential property. It takes longer to find a tenant once a commercial property becomes vacant. A commercial property can be vulnerable to supply. Hence, evaluate your risk handling capacity first then invest in a commercial property. Right decision making in time will prevent any problems later on.