Would you like to invest your money in a property that is profitable and offers security for investors like you? One tangible asset to consider is a commercial property. It can give you more benefits as compared to a residential property.
Sentinel Property Group shares some advantages of investing in commercial properties.
Commercial properties can provide larger income.
Commercial properties can generate the largest profit any investor can make. They can have a gross rental income between 8 per cent and 12 per cent depending on the location. The earning potential is much higher than residential properties which can amount to only up to 4 per cent.
They require a small capital.
Commercial properties are low-priced so you need only a small deposit and capital. On the other hand, a residential property is pricey so you need to save more before you acquire one.
They provide longer leases.
Commercial properties offer longer leases that can range between three and 10 years. Tenants can even stay longer if they have invested in customising the premises. Furthermore, tenants pay for water, body corporate, and property expenses; whereas in residential properties, the landlords pay for them.
They offer professional relationships.
The lessor and the lessee maintain a business-to-business customer relationship. Their dealings and transactions are courteous and professional.
They have limited hours of operation.
Most businesses do not operate at night. For that, you as the landlord need not worry about receiving midnight calls from a tenant complaining about repairs or any untoward incident that may happen in the middle of the night.
They offer more objective price evaluations.
The price of a commercial property is easier to evaluate. You just need to base it on the current owner’s income statement. You can expect to buy the property at a price where you can earn the area’s capitalisation rate to ensure the return of your investment.
Before committing to an investment, you should plan and think carefully. As an investor, profit and security should be your foremost concern. Lastly, make sure that you deal with legitimate firms to protect your interest.