Working with commercial property buying is not as difficult as you may think. However, you need certain pieces of knowledge prior to starting towards any property. Continue reading to gain the information you need so you can move forward with a fully formed strategy which will lead to success.
Before you invest heavily in a piece of property, investigate the economics of the neighborhood such as unemployment rates, income levels and local businesses. A home that is in a great area, like next to good schools and parks, and has jobs available, will have a higher value than surrounding properties.
Whether buying or selling, negotiate. Make it clear that you wish to be heard and refuse to accept an unfair price.
Take digital photographs of the unit. Make sure your pictures clearly show any damage or defects, including carpet stains, holes in the walls or discoloration of plumbing and counter tops.
The location of the property is the most important factor to consider when investing in commercial real estate. Pay attention to the property’s surrounding neighborhood. Look at the growth of areas that are similar. Make sure that the area will still be nice and growing in several years.
If you are looking to lease or rent, the issue of pest control is a critical one to address. It is even more important to look into the building’s pest control policies if you are looking to rent or lease in a region where building pests are common.
Commercial property dealings are exponentially more complicated and time intensive than buying a residential home is. Keep in mind though that the arduous nature of this process is just a stepping stone to better dividends yielded from the hours and money you invest.
Location, location, location is important to consider. Think about the type of neighborhood the property is in. Compare the growth of the property’s neighborhood to similar neighborhoods around the country. The area you buy in needs to have potential over the next 5 to 10 years.
Before buying a commercial property, research its net operating income to make sure you don’t lose money. In order to succeed, you should focus on keeping your figures in the positive.
Make sure that the broker you decide to work with has experience in 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.
Prior to listing your commercial property for sale, have it checked out by an inspector with at least five years of experience. Have any issue that the inspector finds repaired right away.
Get the credentials of any person who will be doing an inspection on a property you are trying to buy. This is even more important for those who deal in pest removal, as many of them work without accreditation. Seeking out professionals with proper accreditation will be worth it in the long run.
If you are viewing more than one property, you may wish to create a checklist for each site. Accept the proposal responses during the first round, but before going further, notify all the property owners involved. You should feel free to let owners know that this isn’t the only property you’re looking at. This may help you snag a better deal, ultimately.
If you intend on putting your commercial property on the rental market, find a simple, but solidly constructed building. Because it is apparent that these types of structures have been kept in good condition, it greatly increases the chances that tenants will be quick to rent the space. This type of property will also make maintenance much easier on both you and your tenant.
You should always know how to get in touch with emergency maintenance. Talk to the building’s landlord about the person who currently handles emergency repairs. Know what the phone numbers are, and know what the response time is for them. Use the information from your landlord to prepare an emergency plan to protect your reputation and customer service for the times when your normal business flow is disrupted.
Commercial Real Estate
In commercial real estate, there are different kind of brokers. Full service brokers work with both landlords and tenants and there are agents representing tenants only. You may be helped much more with a broker who just works with the tenant, as that person most likely has more experience in handling tenants successfully.
As previously indicated, a successful commercial real estate deal requires a lot of upfront information. Hopefully, this article equipped you with some knowledge to help you succeed as a commercial real estate investor.
When hiring a real estate agent, read the disclosures completely before signing a contract with a realtor. One thing you should specifically watch out for is dual agency. In this situation, the agent will represent the buyer and seller. In other words, the agent is representing both you and your landlord in the same transaction. If there is a dual agency, everyone should be honest about it and find an agreement.