A commercial real estate venture is a very different proposition than buying a house. The following tips will help you make a tidy profit from your commercial real estate endeavors.
Some factors to consider before making a big investment into real estate are the expanding or contracting of nearby employers, local income levels, and the rate of unemployment. Homes that are located near schools, hospitals and other major employers are assigned a higher resale value.
Use a digital camera to document the conditions. In the “before” photos, especially, make sure that the pictures clearly show defects such as stains on the carpet, discolorations in the tub and sink, and holes in the walls.
Real Estate Market
When entering the commercial real estate market, patience is perhaps your best ally. Do not go into an investment out of haste. Without due consideration, you might find that the real estate purchase does not meet your criteria for successful financial gain. It may take more than a year to get the right investment in the real estate market.
When selecting a broker, find out the amount of experience they have with the commercial market. For better results they should specialize in the specific area that you want to buy or sell in. Then if they meet the criteria you are looking for, you can agree to work with that broker exclusively.
If you intend on putting your commercial property on the rental market, find a simple, but solidly constructed building. These are the most likely to quickly invite tenants into the space, because they know it is well-cared for. Buildings like these are also easier to maintain, for both owners and tenants, since repairs are going to be required less frequently.
If you are renting out your property, be sure that they are always occupied. Remember that if you have empty units, you have to take care of them. Maintenance costs on empty units can add up. Consider why your property has driven away tenants and try to rectify the situation.
If you are negotiating a commercial lease, make sure nothing can be considered as events of default. This will lessen the possibility of a lease default by your tenant. This type of situation is considered very undesirable.
Get your commercial property inspected before you try to sell it. If the inspections turn up any problems, remediate them before listing the property for sale.
If there is more then one property you are considering, acquire the house survey checklist for each one during your site tour. Be sure to take the initial proposal responses, but do not proceed without making the property owners aware of what is going on. Do not be afraid to let it slip to the owners that there are other properties that you are considering. You may even get a more favorable deal!
There are many things to learn about the commercial real estate market. Remember what you have learned in the preceding article, and you will be able to get a good deal on a piece of real estate that meets your needs.
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