Is It Time to Go from Renter to Owner? 3 Reasons to Say “Yes!”
Most small business owners lease their office space or commercial property, not realizing the benefits of commercial property ownership.
In fact, ownership might be the best choice for your business. Here’s why:
Ownership Is a Revenue Stream
The problem with considering only the costs of ownership is you miss out on the income opportunities it presents. For example, returns on commercial properties are often 6% to 12% of the purchase price. Not only that, but you’re locked into a fixed mortgage, allowing you to anticipate your monthly expenditures without worrying about annual rent increases. Because of that, owners often yield positive leverage from renting out their extra space. Trade in your rent check for an extra paycheck? Yes, please.
Get More Tax Benefits
The tax benefits on commercial property are numerous. Property owners can deduct their property’s mortgage interest in full. Energy efficient upgrades provide more tax savings in addition to energy savings. Certified historic structures in need of renovation are eligible for a 20% tax credit. And when the time comes to sell the building, owners may do so at a large capital gain and defer tax payment–so long as they use the proceeds to buy another property. Keep buying property and you could go your whole life without ever paying capital gains tax. Not a bad deal.
Long-Term Ownership Pays Off
Property appreciates in value, giving you the opportunity to gain from increased value. And if you expand, you already have collateral.
Taking full advantage of your physical space helps your business stand out, so renovate, redesign and decorate as you please. Upgrade it to attract high value tenants and be sure to get a photographer to help enhance your digital storefront.
You have a vision for your business. Buy property that will get you there. We’ll be sure you get the best deal, hassle-free.