Commercial property is not something to go into half-cocked. You can make tons of money, but you can also suffer financial ruin. Try to choose wisely when considering purchasing a property, and thinking about how to fund it. This article is packed full of tips that will help you to navigate the commercial real estate market.
Real Estate
Purchasing commercial real estate is a much more lengthy and complicated process than that of buying a home. Keep in mind, though, that the complexity is required to ensure that your real estate investment gives you a high return.
Whether you are buying or selling, don’t shy away from negotiation. Let people know what you want and make sure you are asking for a realistic price.
Find out more about net operating income. In order to be successful, the resulting number must be positive.
Research local prices similar properties have sold for before setting a price for your commercial real estate. Many different factors can influence the real worth of your property.
If you are purchasing commercial real estate for rental purposes, look for structures that are uncomplicated and sturdily built. Tenants will be attracted to these spots because they are maintained well. Not are the buildings more sturdy, there will be less maintenance issues for the owner and the tenant.
Bring your digital camera along, and use it. Include all the defects in the photo, such as carpet stains, or holes in the walls.
Check into having an inspector look through your property before you put that property back on the market. Have any issue that the inspector finds repaired right away.
Know that there are many different kinds of brokers when it comes to commercial real estate. You have a full service broker who works on behalf of both the tenant and landlord, then you have brokers who only work with tenants. Consider hiring a tenant-only broker as he’ll have the most experience in dealing with situations such as yours.
Dual Agency
Pest control is something you should look into when renting or leasing a property. In some areas, in particular in areas with known populations of pests, this is a very important concern.
Read the fine print about your real estate agent. Understand the meaning of dual agency. Your real estate agency will represent each side of the transaction. This means the agency works for the tenant and the landlord at the same time. Dual agency is something that should always get disclosure, and both parties involved should be in agreement with it.
You should meet with a tax adviser before you buy anything. A tax adviser can tell you what your tax liabilities are on the purchase and future income from it. By taking your adviser’s advice, you may be able to find a location where the taxes are less.
Find out specifically how a real estate broker negotiates prior to choosing them. Ask how they were trained and how much experience they have. Look for a broker who cares both about ethics and helping you succeed. Ideally, he or she should be capable of helping you get good deals without resorting to immoral or illegal activity. Ask for a portfolio, featuring both sales that were closed and sales that fell through.
Take some time to visit websites that are devoted to commercial real estate. These sites have lots of information for both new investors and seasoned professionals. Excessive knowledge isn’t a problem you have to worry about, so it always proves smart to learn all you can.
Again, commercial real estate investment isn’t a get-rich-quick scheme. You will need to put in enough time, work, and have a lot of money to invest to be successful. Even when you do everything right, it does not always work out in the end.