Buying a commercial property can be a great investment. Nevertheless, many people miss out on prime opportunities because they fear the industry is too complex and risky.
The trouble is, most of these fears are based on harmful misconceptions. To set the record straight, we’re about to debunk the five most common commercial real estate myths:
1. You Need to Be an Expert to Invest in Commercial Real Estate
As with all forms of investment, commercial real estate is packed full of inherent complexity. Though it’s unlikely that you’ll ever be able to fully comprehend every aspect of commercial property law and tax implications, the fact is, you don’t need to. What you do need to do is find experts you can trust and ensure you turn to them whenever advice is called for. With the help of a commercial property manager, you’ll be able to clarify your investment goals and create a plan of action. As time goes by, your knowledge will grow naturally and exponentially.
2. Commercial Property is Out of My Price Range
It’s true that non-residential properties can come with mind-blowing price tags. However, that doesn’t mean there aren’t commercial opportunities within your budget. This is particularly the case if you are a part of a partnership or syndicate. Even if you go it alone on a modest budget, MCO has affordable commercial property opportunities for sale at prices that will surprise you. It’s all about having the patience and diligence to keep hunting until you find the right property.
3. Risk Exaggeration
This myth is interesting because we hear extreme opinions in both directions – some people are convinced that commercial property investment is virtually risk-free, while others insist that its risk level is catastrophic. Clearly, both those concepts can’t be true. In fact, neither is accurate. Like any investment, there are uncertainties involved. However, these can be greatly mitigated by doing your due diligence and bringing in experts to take care of anything that’s above your head. If you’re willing to do this and be patient while you hunt for and then arrange the right deal, you’ll increase the likelihood of reaping the rewards with a healthy return on your investment.
4. If It’s Available, It’s Advertised
With so many properties on the market, it’s easy to assume that if something’s available, you’ll be able to find it in the listings. However, this isn’t always the case. Many of the best commercial real estate opportunities never hit the menu. Why? The commercial real estate game is a relatively small and tightly-knit club. Most of the larger property investors and agents maintain close networks such that information disseminates fast. In many cases, a great agent may be able to find a buyer among their industry contacts without the need to advertise. This is why developing a network is of vital importance – fostering good connections within the industry will stand you in good stead for hearing about those opportunities that never get listed. Speak to your agent about any properties they know of that are currently, or may soon become available and you may get the jump on your competitors
5. Managing a Commercial Property Will Take Up All of My Time
If you’ve told someone about your commercial investment dreams, you’ve likely been hit with this myth – “you’ll never have any free time left if you take on a commercial property.” While it’s true that property management is a great deal of work, as the investor, most of it isn’t your responsibility. This is why property managers exist – to handle the legislation, leasing, tenancy issues, maintenance demands, and all the other fine details. All you need to focus on is developing your network, building your knowledge, finding your ideal property, and securing a good deal.
So, what’s the takeaway from all this? If you have a solid network, good communication skills, and an expert or two on your team, there’s no need to fear commercial property investment. Indeed, if you’re well prepared, it could be your ticket to financial freedom.