It’s an interesting time in our economy right now, and figuring out where to invest can be challenging. Commercial Real Estate, however, is a great place to put your money.
Here are the top five reasons for this:
- Income potential: Investing in commercial real estate gives you a chance at an excellent return on your investment. The money you’ll make off of commercial properties far exceeds that of homes, given the sizes, higher rent or lease rates, and variables like location that renters are willing to pay more for.
- Low turnover. If you invest in homes or apartments, you’re likely to be constantly searching for tenants. Businesses, however, are under longer lease agreements, and since their location is often part of their brand, many people stay put so they’ll keep their customer base. This means a much more secure income stream.
- Tax benefits. There are a variety of tax benefits that come with owning commercial real estate, including the possibility for deductions due to interest and depreciation.
- Lower loss risks. While you may lose tenants here and there, the odds of losing all of your tenants at once are low to non-existent. This means you can always count on some income.
- Diversifying your stock portfolio. A diverse portfolio is ideal no matter what. Commercial Real Estate also has a low correlation to the stock market. This means that even as the markets soar and dip, commercial real estate is not as likely to be affected.