Investing in the commercial real estate market can be a double-edged sword. When done correctly, it has the power to generate massive profits. However, an unwise move could cost you a great deal of money. The trick is to choose wisely, know what property is marketable, and have the means to get the money for the transaction. This article will help you get the most from your real estate investment.
Take digital pictures of the place. Be sure that the pictures show any current problems with or damage to the home.
Location, location, location is important to consider. Think over the community a property is located in. Compare this neighborhood to the growth of other similar areas. You want to make sure that in 5 or 10 years down the road, the area is still a descent and growing area.
If you are trying to choose between two desirable commercial purchases, the larger one may be the better choice. Financing may be no more difficult for the large apartment building than the small one. Also, purchasing more units is like buying in bulk. The more you buy, the cheaper each unit will be.
You should thoroughly look into the brokers that you are considering, and determine their level of expertise and experience when dealing with commercial real estate. Look for brokers who specialize in the type of commercial property that you’re purchasing or selling. Allow the broker to acknowledge your wish for an exclusive agreement between the two of you.
List your real estate at a realistic price. Different variables can have an impact of the value of a lot.
Do your best to have your properties occupied at all times. If you have units that are unoccupied, you will not only lose money due to lack of rent, but also the upkeep of the space. If you have several properties open, you should ask yourself why, and attempt to correct the issues that may be driving out your tenants.
Make sure that the commercial property has access to all utilities needed. The utilities you will need for your business go beyond electricity; you will also need water, sewer and gas, as well.
If you put the commercial property up for sale, have it inspected. You can fix any problems right away so you have the best available property.
Take tours of any properties that you’re considering. Look into having a professional contractor accompany you as you take a look at the properties you’ve been thinking about purchasing. Once that is done, you can submit your proposal and begin negotiations. Don’t decide on anything without careful consideration.
Start drafting letters of intent by focusing on the more central issues. Once you have agreement on those, broaden the negotiations to include any smaller issues that remain. This approach lowers the overall tension level and actually makes it easier to reach agreement on the details at the end.
Clearly, investing in commercial real estate will not bring you money for nothing. It takes a lot of time and effort–not to mention a sizable down payment–to succeed in the commercial real estate market. Even if you do all that, you might still end up losing money.