Getting started in the commercial real estate market is much simpler than it seems. You should know a few things before you get started. This article is packed with useful guidelines and insight that should facilitate a more thorough understanding of the commercial real estate market.
If you’re a buyer or if you’re a seller, it’s important that you negotiate. Make sure that you are heard and that you fight for a fair price for the property.
Buying commercial properties requires plenty of perseverance and calmness. Do not make impulsive decisions. You may soon regret it when the property does not fulfill your goals. It could take you twelve months or longer to get the deal that fits you perfectly.
Real Estate
For those who have an interest in real estate, reference websites that offer information to a investors of all experience levels. You can never know too much when it comes to commercial real estate, so never stop looking for ways to obtain more information!
Purchasing commercial properties is more time-consuming and complex compared to the purchase of a home. Understand, however, that the intensity and duration of the process is necessary to achieve the higher return on your investment.
If you have two commercial properties on your short list, you should buy the larger one, if at all possible. Getting the proper financing is going to the same hassle for a retail building with ten outlets as it would be for a retail property with twenty or even thirty units. Generally, this is much like the principle of buying in bulk; the more units you buy, the lower the price per unit.
Research local prices similar properties have sold for before setting a price for your commercial real estate. Market conditions can vary greatly; therefore, an appraisal may not be the best indicator of true market value.
When having your real estate inspected (as you should), always ask for the qualifications of the inspectors. Pay particular attention to credentials when it comes to pest inspections, since it is not uncommon to encounter people working in pest removal without a license. This can help you avoid headaches after the sale.
Smaller Issues
A letter of intent should be kept simple by focusing on larger issues and leaving smaller issues to negotiate later. This will make negotiations less tense and make gaining agreement on the smaller issues easier to complete.
You need to know the details of emergency maintenance procedures. Speak with the landlord about handling of emergency repairs just so you know who to call in that situation. It is important to keep these contact phone numbers handy and to have a good understanding of how long it will take for them to respond if needed. Use any information you can get from your landlord so contingencies are ready for the times your normal business operations are interrupted so you can safeguard your customer service and your reputation.
When hiring a real estate agent, read the disclosures completely before signing a contract with a realtor. Never neglect the fact that you may be dealing with a “dual agency.” What this means is that your chosen agency has an interest in buying and selling the property. This means the agency works for the tenant and the landlord at the same time. Dual agencies require full disclosure and must be agreed upon by both parties.
Choose a reputable business where they strive for exceptional customer service. If you don’t do this, you could end up with a bad deal and lose more money as time goes on.
To make sure you are working with the right real estate broker, ask what they consider as a success or a failure. Ask them how they measure their results. This will help you assess their working strategies. Only work with them if you feel you are a good match, and have a similar philosophy about the strategies they use.
Commercial Real Estate
As you have seen, it is important to do your research before jumping into investing in commercial real estate. Ideally, this article will have helped you to expand your knowledge base and improve your understanding of commercial real estate.