Are you thinking about investing in commercial real estate? There certainly are a number of very good reasons to look to opportunities for buying commercial real estate. There are also things you can do to make the process easier and less stressful. Douglas E Fleit has the following tips for people who want to make the plunge and start investing in commercial real estate.
- Learn the lingo. All industries have their own terms and general vernacular. This is part of the learning curve when you start working in a new field. You will have to look to experts at commercial real estate companies, cautions Douglas E Fleit, but you will feel less out of your element if you are familiar with some of the terminology that you will hear used often.
- Be open to new opportunities. If you go into the process with a mind that is dead set on buying one kind of real estate or dead against it, you may miss out on some great deals that are in different areas. For example, if you have your heart set on owning an apartment building, you may miss out on a great chance to buy and run an office building. If you are looking at residential buildings, remember that it is just as easy to manage a building with 20 units as it is to manage one with five. The main difference is you will get more back for the work from the larger building.
- Find experts you can trust. Everyone needs some help with their first commercial real estate deals. Get to know, if you do not already, some commercial real estate investors who can help you evaluate deals and explain the lay of the land. They can let you know what they think of a deal you think is excellent. Be prepared to have them give you the reasons that deal you think is the best you will this century is not all that. They can give you valuable insight into the process.
- Patience is your friend. Buying commercial real estate is not like buying a residential property. In the first place, everything takes longer with commercial real estate deals, says Douglas E Fleit. If you go into the process expecting this to take a longer time than you think it should, you will find yourself less irritated by the inevitable delays you will experience. The more patient you are with the process, the better the deal is that you will end up. Do not let impatience lead you to a bad decision that you will regret. Your first commercial real estate deal will take the longest amount of time. If you continue to make more commercial real estate investments, you will find the other deals will take less and less time.
- Consider working with a partner. For the most part, commercial real estate deals are best done when there is more than one person working on the deal. In the first place, if you are new to commercial real estate investing, having a partner with more experience or with more access to funding can be a really great thing. It is also nice to have someone to commiserate with and to help you destress. The bigger the deal, the more you will benefit from having a partner in the process.
- Look at getting financing before you start looking at properties. You need to put down more at first when you are going for a commercial real estate loan. Many lenders require people put down as much as 30%. This is another way a partner can help. If you do not have the cash on hand and/or you need some help with your credit score, they can be a real asset. The first places you should go are to the financial institutions that know you. Also look at local credit unions. They really like being able to help local businesses. If you can secure some funding before you start the process, you will find yourself in a much better situation, says Douglas E Fleit.
Commercial real estate can offer you a lot of opportunities to make money if you work at it.