Factors to Consider While Buying Commercial Properties in Melbourne
Commercial real estate is arguably one of the best investments. There are a lot of questions that an investor goes through while investing. And the question that sits atop of this checklist is, do you need to purchase this commercial property?
Whether you are buying a commercial real estate in a suburb like Moorabbinor a major city like Melbourne, the answer to this question needs you to analyze various aspects of the property and your assets.
Despite being a challenge, investment in commercial properties can be rewarding and yield higher returns. But the risks are also equally higher. Though risks can never be ruled out completely, what an investor can do is consider some crucial elements before investing in a commercial property.
Here are some to start with:
Selection of Location
The location will make a massive difference in the long term. Having a commercial property in a place with easy access to infrastructure makes it easier to run business. And more importantly, it keeps adding value to the property with time.
The right place is essential for a better return on investment. Some of the things that you need to consider while selection location for commercial are:
- Traffic flow – the amount of vehicular traffic and foot traffic
- Visibility – whether your property is visible from Main Street?
- Position in the suburb
- Easy access to public transport and other infrastructure
- Businesses around that support leases
Decide the Right Type
When you are buying a property as a form of investment, rather than use, you should have clear understanding about the form of returns. Depending on property types, the form of returns also differ.
Broadly speaking, these can be categorized into depreciation benefits and rental returns. Some properties offer depreciation benefits which can be used to offset taxable income. And some offer rental returns thatare purchased for cash returns.
You need to be clear on whether you want depreciation benefit or rental returns. It narrows down your options and this will make your search for a property much easier.