Commercial Real Estate
Commercial real estate can be a great investment for your money. Whether you're buying it to house your business, to gain rental income, or to build equity, commercial real estate can be a valuable asset. Keep in mind however, that purchasing commercial space is different than buying a personal residence. Make sure that you have a good knowledge of zoning laws, taxation and any CC&Rs (covenants, codes, and restrictions) before you buy.
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Commercial Property: The Benefits of Ownership
A Place to Run your Business
If you run your own business, it's important to have a place where you can showcase your products or services, and meet with clients. You want this area to be separate from your home so that you can maintain separation between your work and your personal life. Also, working in one's home can be noisy and distracting, isn't equipped with customer parking or public facilities, and won't have things you need like extra outlets and a large work area.
A Way to Make Income
Renting out commercial space can be very profitable for property owners. You could have tenants pay your monthly mortgage payments, and then some.
If you're thinking about buying commercial real estate in order to rent it out, it's imperative that you know the laws, bylaws, and zoning rules that may apply. Remember that different types of commercial rentals are governed by different sets of rules, so it's important that you're well informed before you make an offer to purchase.
Deciding how you want to manage your property is another thing you need to figure out before you buy. First, there is the issue of how close you want to operate with your renter(s). How are you going to resolve disputes? How are you going to deal with property maintenance and repair? How much money are you willing to set aside for this? Many management companies will take care of these details for you, but they'll charge a healthy sum for their services.
Enhance your Financial Portfolio
Building equity is another big reason to buy commercial property. Whether you're using the space to run your own business, or you want to rent it out, you will be saving up money gradually instead of spending it. If you're using the space for your business, then the business can pay the mortgage; if you're renting it out, someone else will be paying the mortgage for you. Either way, buying commercial property can be a good way to add a major asset to your portfolio. If you buy wisely, you may see your property appreciate significantly over the years.
Purchasing commercial space can also be a great way for someone to enter the real estate investment market. No matter what your intentions are with the property, it can bring you income via business or rental income today, and in the future with its increasing equity.
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