Why Guide Aren’t As Bad As You Think
Many people think of residential housing once they hear of real estate investments. There are a number of residential houses such as manor homes and holiday units. But, commercial investments can earn you good money as well. Such properties need not be isolated factories in industrial estates. They could be state of the art offices and someone does not need special skills to know their value. However, the major challenge lies in knowing how to make commercial properties a worthy venture that suits you. Luckily, they can be managed the same way as residential properties. The right step to take is to identify the ideal tenants that support the growth of your investment.
You need to ensure that everything is on the right track. Managing commercial properties for rent is the same as managing residential ones. You must consider the clientele you want your properties to attract, its location and condition. For example, customers that like rural properties might not be attracted to town houses. Even though the two options come with their merits, you must be very sure of the tenants you want to attract and the revenue you intend to generate.
Obviously, rentals that are close to a city are more costly because they are proximal to other facilities. What is more, commercial properties with parking facilities will cost more than rural properties without car parking. Also, the property must be in great condition when moving in as there is no need for repairs. Similarly, any repair costs that are incurred might not be your responsibility depending on the terms of the agreement you sign.
You must also understand the difference between a rental and a lease. Both are commercial agreements that you can access. A rental does is not specific about the period of occupancy and the agreement can be altered by the tenant and landlord after 30 days. In contrast, a lease contains the period that the tenant is expected to dwell in a property. Both agreements give the landlord the sole custody of maintaining the property. But, the tenant is responsible for payment of taxes and insurance, as well as, doing maintenance if he signs a triple net lease. That is similar to allocating to the tenant the duties of a landlord for a given period. This is beneficial to many landlords but, it might not work if the tenant neglects building maintenance.
Additionally, commercial properties have higher returns than residential ones. Also, buyers would rather invest in affordable commercial real estate than residential properties. Likewise, the rent of commercial offices and structures is also higher.