Debunking Common Commercial Real Estate Myths
Commercial Real Estate is an adventure that can be very rewarding and profitable while also being extremely challenging. Commercial properties are much larger, complicated purchases than housing properties, so sometimes there can be a couple of misconceptions about the process. Let’s take a look at some common myths about commercial real estate.
Firstly, a lot of people might assume engaging in commercial real estate is way too expensive. There is a tendency to believe that the bigger and more complex a property is, the more the cost of buying and maintenance increases. This is not always the case. Many banks and finance lenders are willing to support your commercial real estate investment, especially since commercial real estate brings in more money than residential real estate. Additionally, people sometimes believe that commercial real estate takes up too much time because it is a bigger space. The truth is that you can outsource much of the maintenance and renovation work to contractors, and finding tenants can be delegated to listing agents.
It’s easy to think that investing in commercial real estate is extremely risky and not worth it. The risk for commercial properties is dependent on a variety of factors. As stated in an article on fortune builders: the more volatile a property is, the higher the risk is. Office properties are more volatile and risky, whereas triple net lease properties are less risky. One might also believe that it is difficult to find a good deal on commercial real estate. The key is to do adequate research before purchasing any property. Carefully analyze all the details about the location and market, and make sure you’re buying in your focus area. It is also common to buy when the market is low as the property is expected to appreciate.
Lastly, do not assume that just because a property is for sale, that means something must be wrong with it. People sell commercial properties for various reasons, and investors should avoid looking for flaws that aren’t actually there. Along with proper research, make sure you join with a team that has adequate knowledge of the market and CRE investing so you can have reliable guides before making any decisions.
