| There are numerous ways to invest in real estate. | | | | then commercial property. People always need a |
| You can rent, flip, or fix. There are condos, homes, | | | | place to live. Businesses, however, come and go |
| apartments, land, and buildings to invest in. The | | | | dependent on the market. |
| options are limitless. | | | | 2)Financing residential property tends to be easier |
| There is, however, a great divide some investors | | | | then purchasing commercial property. |
| have a hard time deciding on, residential versus | | | | 3)If needed, you could actually live in one of your |
| commercial investing. | | | | rental properties. |
| Residential property is perhaps most commonly what | | | | 4)Residential property is usually less expensive then |
| comes to mind when thinking of real estate investing. | | | | commercial. |
| In general, residential property is a living space. This | | | | 5)Residential property can require your immediate |
| can include apartments, duplexes, homes, and | | | | attention when problems arise. Problems can come at |
| condominiums. | | | | any hour on any day unlike the traditional 9 to 5 |
| Commercial property, on the other hand, plays home | | | | business that rents commercial property. |
| to businesses in the form of office space, retail | | | | 6)As a residential landlord, you usually have to |
| space and other industrial type tenants. | | | | perform a lot of hands-on management. |
| When considering which type of investing is best for | | | | 7)If you have a single residential piece of property |
| you, there are a few questions to ask. Most of us | | | | and you lose a tenant, you just lost all your income |
| have experience in residential dwellings. After all, we | | | | for that particular property until you can replace the |
| grew up in homes. | | | | tenant. This can cause cash flow problems. |
| You have a set of expectations for your residential | | | | Commercial property also has is pluses and minuses. |
| rental property. You know how you anticipate it to | | | | 1)A nice thing about commercial property is the |
| be cared for and what assumptions you want to see | | | | leases tend to be considerably longer then that of |
| in your tenants. Commercial property is a little | | | | residential property. Where a residential tenant might |
| different. We haven't all necessarily rented or owned | | | | sign a year lease agreement, commercial tenants |
| commercial property. | | | | usually stick around for five or so years. |
| What is unique about commercial property is the | | | | 2)Unlike residential, commercial property requires less |
| landlord often hands the property over to the tenant | | | | management. Depending on your personality, this |
| and has very little to do with it after that point. You | | | | may or may not be desirable to you. |
| basically have to trust in your tenant. Plus, unless you | | | | 3)Commercial investing isn't as beginner friendly as |
| have business experience, you probably aren't familiar | | | | residential. Start-up costs can far exceed that of |
| with the guidelines and assumptions of commercial | | | | simply purchasing a home. Even worse, if can be |
| property leasing. | | | | harder for beginner investors to secure a loan for |
| With all of that said, let's look at what benefits and | | | | commercial property. |
| disadvantages come with investing in residential | | | | 4)Finding a tenant for you commercial property can |
| property. | | | | be a lot harder then securing one for your residential |
| 1)In general, it is easier to rent residential property | | | | property. |