Commercial
Guide

Naturally, choosing to purchase commercial property does have its fair share of benefits. To
give an example, you will not be particularly affected by rental increases. This allows you a
more precise degree of control with regard to your outgoing payments. You will also
undoubtedly enjoy a superior degree of flexibility with regards to designing the internal look and feel of the building. You may configure it for your own use.
Purchasing commercial property also has financial benefits. For example, you may find it is possible to sublet a portion of the property, which will help to decrease the payments you have to make with regards to a mortgage and increase your passive income streams.

Considering that repayments on a mortgage would be similar in terms of the total to what it might cost you to rent a commercial property, you will benefit from some degree of capital appreciation in the event that the value of the property increases.

Ultimately, there are things to consider if you’re going to own commercial property. As an example, the market value of the property can drop, interest rates can increase, which means that the property could become a very expensive endeavour.

It’s definitely important to consider both the good points and bad points of buying into
commercial property. But, if you decide that it is still for you, then there’s a couple of different
things that you need to think about, and some criteria to consider.

You have to make sure that you think about the location if you’re going to invest in commercial
property. It is so very important to get it right. Location can mean a lot when searching for the

right property so you’ve got to make sure that you pick an appropriate property for your
situation.

To give a good example, people who are looking to get involved with retail purchases should consider a property that has easy access and reasonable transport links. A proximity to
suppliers and the general public should also be considered for best results. This is especially
important if you are dealing with a trade that relies solely on footfall in order to flourish. So, for a more prominent example, if you were dealing with a brand-new shopping facility located on the outskirts of the area, then your more traditional High Street shop could suffer, because you’re not getting as much traffic.

With that being said, a lot of technology companies can find massive benefits from low-cost properties. Especially if these properties are in remote locations, it is possible for a remote management system to be implemented, so long as staff can get to the premises easily.

It’s important to consider transportation networks and hubs, especially if you have a business that is involved in the production and sale of goods. Alternatively, online retail has the same sort of basic requirements.

Thankfully, you do have finance options when it comes to purchasing a commercial property.
Typically, you will require a mortgage of some description, so you need to make sure that you
compare all of the different deals that are on offer, because you will want to find the best interest rates and the most comprehensive assistance package in setting everything up.

It is expected that you will have to put down a deposit which is anywhere from 20% to 50%, and most lenders will not accept anything less. In order to successfully get the mortgage, you will probably have to provide evidence of your business accounts, as well as cash flow projections in order to properly evidence you can afford the mortgage.

Generally, mortgages of this description have a fixed year term of anywhere from 3 to 25 years,
but the average is about 15. It’s up to you to take a look at all the different options and make sure that you can afford the mortgage, as if you don’t keep up with your scheduled payments, your property may be repossessed.

So, the final costs of your commercial property will vary according to your situation. The
premises becomes yours legally once you have signed your contract and put down a deposit.
However, there are a couple of extra final charges that you will need to think about.

A fairly prominent example in this regard would be stamp duty. You also may have to pay VAT on the property, as well as the cost of setting up and installing electricity tariffs, Internet, security systems, building insurance, maintenance costs, there’s a lot of different things to consider.

To summarise, purchasing or investing in commercial property can be an expensive endeavour, but it’s also a good way to diversify your income streams, open up the range of operations that your business can undertake, and generally grow the enterprise that you have started. Investing
is generally considered to be what separates the smaller businesses from the larger ones, as it is a definite risk. However, if you get it right, it will pay off in a large way.