Commercial real estate can be a tempting potential revenue source for property investors. Smart investors stay aware of the fact that commercial real estate is a different game from ordinary residential real estate, though. This article presents some of the specialized concerns real estate investors should keep in mind when they decide to enter the commercial market.
Invest some time in learning about how the real estate market works. Read some books or online resources to find out the best ways to go about investing your money into your future home. This will help you with the lending, selling and purchasing aspect of the real estate market.
Before you rent your new house or apartment be sure you have enough references. Most landlords require at least three references. Check the names, addresses and phone numbers for accuracy. There is nothing worse than a reference whose name is incorrect, the phone line is disconnected or the letter the landlord sends comes back as undeliverable.
In negotiating any real estate deal, whether you are buying or selling, identify the other party’s highest priorities and stay away from them. Everyone has certain issues that they do not want to negotiate. By figuring these priorities out and leaving them alone, you demonstrate respect and attention. The other negotiator will appreciate this and become more flexible on the issues that are less important to them.
Before you begin the process of purchasing a commercial real estate property, make sure you find a commercial broker who can help you with your specific needs. Some commercial brokers are not skilled in all commercial real estate areas, which could prevent you from getting what you are specifically looking for.
Obtain and study information about the number and types of businesses surrounding each commercial property that you are considering, based upon the underlying type of business that will likely occupy the property. A deli or restaurant space might not be your best option if there are dozens of established eateries within a five-mile radius.
Although it is always nice to give people a chance to show their worth, a termite inspection is not the time to be charitable. Make sure that your inspector has many years of experience. Ask to see his past work and make sure he has found termites in at least some of his inspections. There are many inspectors who just give auto-passes constantly.
Put an advertisement in your local paper. These tend to be fairly inexpensive, but are also seen by many prospective clients, buyers, and sellers throughout your local area. Remember, many people (especially older people) do not use the Internet. Use this ad to your advantage by letting people know as many details about the property as you can, and give them an easy way to contact you.
Get sellers interested in you. You want the sellers to be vying for you to buy their property, ensuring that you are getting the greatest deal and the best negotiation out of the deal. If you are a prized buyer, sellers will be seeking you more so than you seeking them.
When looking to sell a commercial property, make sure you look at all your offers. Don’t just take the first one. You want to make as much of a profit as you can. This is a business and you don’t want to sell yourself short. Ask for advice if you feel your need it.
Investing in commercial real estate is more complex than residential home trading, for a very good reason: The potential profits are much greater. The traders who realize these profits are the ones who do their homework. A well-prepared, well-educated commercial real estate investor is less likely to fall prey to the common pitfalls and more likely to get the most out of his or her money.