5 Reasons You Should Buy Your Commercial Property
When your business needs a new facility, you face the dilemma of whether to buy your own space or lease a suitable property. While leasing offers several nice benefits like smaller upfront costs and minimal site maintenance, there are at least five very compelling reasons that buying your own facility could make more sense for your company. Buying your own property:
- Saves You Money Over Time
- Buying a property will require more money at the outset. A down payment of between 25 percent and 30 percent is standard for a commercial property mortgage and there will be associated lender fees. Yet if you plan to stay at your facility for many years, you could actually be able to save money over time. You can often pay less in mortgage payments than you would in monthly rent and your business would have a tangible asset to show for all that money at the end
- Rewards You With Equity
- When you buy any property value appreciation that occurs belongs to you instead of to a landlord. Down the road, you may be able to take out commercial property equity loans or lines of credit based on any increased value. And of course, if you decide to sell, you will make a profit that will help you move on.
- Generates Tax Savings
- With a commercial property mortgage, any interest you pay on the loan is tax deductible. You can also deduct from your taxes the cost of any repairs or maintenance for the facility.
- Gives You Complete Control
- If you really need a customized space, buying is the only way to go. With your own space you are free to renovate or make additions however you want, without asking for a landlord’s permission.
- Guarantees A Good Location
- If location is an important factor for your business, buying a property in a good spot guarantees you can stay. There is no need to worry that the landlord might cancel your lease or raise your rent too high to stay. Plus you can have a permanent address to give customers, a place where you can gain name recognition or the foot traffic you need.
Of course there are situations when leasing makes more sense, but before you automatically take that route, see if buy a commercial property doesn’t pencil out better for your business.