Why Should Invest in Commercial Properties Instead of Residential Properties

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Why Should Invest in Commercial Properties
Instead of Residential Properties?
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Commercial and residential real estate are very
different from each other and it is important to
learn about them before investing in a property.
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The residential properties are available in a
plenty which can be bought at a below market
price and are easy to manage.
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Investing in a commercial property is regarded
as a tricky business but involves an opportunity
to make a lot of profit.
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Here are just some of the prime reasons why more
property investors are choosing commercial
property instead of residential.

• Better tenants
• Zero furnishing cost
• Increased asset value
• Consistent returns

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Better tenants
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Depending on the location of the property,
normally the tenants are banks, corporate houses
or retail chains.
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Having such tenants is a good deal as there is
never a delay in the rent collection and even
maintenance problems are minimized.
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When you have a quality tenant, it attracts more
such tenants in the vicinity and helps to ensure
best future rental yields.
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Zero furnishing cost
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A major advantage of investing in commercial
properties over residential is that you don't
have to spend money on the furnishing of the
building.
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Generally, the corporate houses or the retail
chains wish to furnish the property as per their
need and requirements.
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The main cause is branding and the businesses
want their outlets should be similar in
appearance at all the places.
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Increased asset value
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In case of excellent value appreciation rates,
commercial real estate investments are always way
above the other types of investments.
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When business flourishes in an area, then the
location witnesses new developments bringing in
more customers for investments.
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The developments not only produce more profit
from the rents but also the owners can earn a
good sum from reselling the property in the
future.
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Consistent returns
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The lease agreements for commercial property is
always signed for long terms like 5 or 10 years
and the owner is assured of consistent returns
unlike residential property.
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The lease agreement also has a clause of annual
increase irrespective of the market conditions
which means a more reliable source of income for
the owner.
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Commercial tenants often take on many of the
costs like insurance and maintenance that
landlords would be traditionally expected to
cover in the residential market.
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