If you’re reading this article, then you’re already well aware of the fact that commercial property has the potential to give you far better returns on your investment than residential real estate. With commercial property managers offering surprisingly good rates and an abundant market full of good deals just waiting to be found, there has never been a better time to start developing a commercial property portfolio.
The tricky part is figuring out how to go about this. While there are plenty of good deals, there’s also an abundance of duds; and one false move could see you in a whole lot of financial trouble. With this in mind, we’ve created a five-step blueprint, comprised of secrets from the pros, to help you make the best moves, right from the start.
4 Secrets to Managing Your Commercial Property Investment:
1. Plan Before You Act:
It is vital to have a plan in place before pursuing any commercial real estate deals. You need to know how much you can afford to pay and over what period of time before you shop around for mortgages. Once you have some figures laid out, a good commercial mortgage calculator will help you drill down to more precise levels of detail. On the flip side, you need to also have an idea of how much money you expect to make on the property, and how.
2. Learn How to Find the Best Deals:
With a solid plan for your costs and earnings in place, you’re ready to start vetting potential deals. To do this, you can employ a multi-pronged approach, taking advantage of the internet, classified ads, and “bird dogs” who have the connections to hunt you down the best properties (for a referral fee). While classified ads may seem old-school, this very fact means you can often find highly motivated sellers willing to let their property go at below market value.
3. Know What to Look for When Inspecting a Property:
Once you’re on site and inspecting the property, it is essential to keep a mindset that says “I’m ready to walk away from this” if something’s not right. Getting too attached to a property and the future you’re envisioning for it can result in you overlooking vital faults that could end up costing you dearly. Remember, there will always be another good deal. With this mindset firmly in place, be on the lookout for damage and anything else that will require repairs and carefully assess the property and the deal for risks.
4. Hire a Professional:
Let’s face it, if managing commercial property investment was a simple task, you wouldn’t be here reading this article. While you may wish to take control of your investments yourself, it is likely that your time could be better spent on high-value tasks within the scope of your current skill set. Rather than learning the complex ins and outs of the trade, it may be worth enlisting the expert assistance of a commercial property manager. Likewise, it is vital to ensure you have professional legal counsel for any deals you’re planning to go ahead on to be sure you’re not missing something in the fine print that could come back to bite you down the track.
While the world of property investment is a complex one, your ventures into it don’t have to be. In fact, if you plan ahead, know what you’re looking for, keep a cool head when inspecting properties and enlist the services of industry experts, you can sidestep the potential pitfalls and focus solely on the profits.
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