Investing In Commercial Real Estate vs Private Property – Here’s Why

Property investment is a popular way to ensure that your money works harder for you. However, when most people think of investing in the property market, their minds go straight to the buying, selling, and leasing of private homes.

In fact, they forget all about the commercial real estate, something that the following article will show is a mistake, as there is definitely money to be made in this sector too.

Office buildings are one type of commercial property to invest in.

 

Good Selection

One of the largest advantages of choosing commercial real estate over private property is that there is such a large selection available.

You have industrial buildings, out of town properties, shops, offices, and manufacturing plants, as well as a whole other raft of choices to consider.

Of course, with such a wide selection it does mean that it’s best not to just dive in and buy any old commercial property that comes up! Instead, you will need to do your homework and research the market that you are investing in, as the best way to make long-term investments is to be as knowledgeable as you can be about the market from the start.

 

It’s a Different Market to Deal With

If you are looking at the commercial real estate for sale to buy as an investment, you are likely to have a very different experience than if you go for a private property.

This is because the individual residence markets depend on much more on small scales situation and actions. Something that can mean the tiniest thing can hold up your purchase or sale, and cost you a significant amount of money.

For example, in a private residential sale, a property chain cause a delay. This is when you cannot complete your purchase because the folks that are selling are having problems with the house they want to move to.

However, in the commercial sector, it is much more likely that the building is being sold either because the company has gone into liquidation, or they have been successful and built new premises. Something that means its a lot less likely that your purchase or sales will get held up.

It’s also true that you will be dealing with a totally different sort of buyer and seller in the commercial market. That means it’s much less about making the property appeal to individual tastes and aspirations for the future, and more about demonstrating the functionality and usefulness of the building to a company.

Something that as you get more experience in this sector will become easier and easier, especially if you use a great commercial agent to help you.

 

Higher Values Involved

Another important factor in choosing commercial real estate over private property is that it has the potential to make you a much larger profit in the long run. This is because the commercial sector can deal with higher values than the private sector does.

The reason for this is that there are less commercial buildings than private residences on the market in the first place, meaning that you already have a premium on your investment.

Team this with the fact that particular properties will be desirable to certain markets and you can really make a killing investing in this area. Something that is true whether you choose to buy and then sell the property, or whether you choose to lease it out.

Have you considered investing in a commercial real estate?  Share your thoughts and comments below.

Cheers!