Small business
Searching for your first commercial property can be an exciting, yet daunting and potentially risky task. Whether you’re looking for the ideal investment property, or a base to run your business from, there’s a lot of factors you need to first consider.
Here, we’ll look at some of the most important things to keep in mind before you buy your first commercial property.
Location and finances
Two of the most important considerations you’ll need to make include the property location and the financial implications.
Location is important because it determines just how lucrative the property will be. First and foremost, you need to ensure your customers and clients will be able to easily reach you. However, it’s important to do as much in-depth research into the area as possible. For example, what is the cost of living in the area? Does it have a high unemployment record? Does it appeal to your target market? If you get the location wrong, you could end up losing the majority, if not all, of your investment.
Just as important, is figuring out the financial costs of buying and running the property. Will the building be subject to VAT and what level of stamp duty will you need to pay? Then there’s the cost of insurance and tax to worry about. You’ll also have to potentially find up to 25% of the deposit to buy. Ensuring you have a good understanding of all of the costs involved is what will determine your success.
Renting or buying – which is right for you?
Owning your own commercial property may be the most attractive option, but that doesn’t mean it’s the right one for your business. There are a lot of drawbacks that come from actually owning a building, rather than renting one.
For example, if you plan to expand and alter your business direction, you could soon find the premises you bought no longer fit your requirements. You won’t have the same level of flexibility as you would if you were to rent a property through a company like GVA Grimley Limited.
So, if you’re happy with the way your business is now and you have no plans to expand anytime soon, buying could be the better option. However, it is worth looking into the pros and cons of renting too before you make a decision.
Overall, before buying a commercial property you should always do as much research as possible. Consider your needs and the amount of space you’re likely to need. It’s also sensible to weigh up the pros and cons of both renting and buying in order to establish which is right for you.
