Commercial property is a great way to invest your money in the US. This broad term refers to any property that you lease or rent out in order to make money. Commercial property includes duplexes, triplexes, fourplexes and any other multi-family property or apartment buildings. These types of investments not only pay for themselves, they offer a great return on investment (ROI). Here are three reasons to invest in commercial property in the US.
1) Rental Income
Commercial property provides you with immediate income in the form of rental payments. If you’re buying rental property that already has tenants, you are also purchasing the leases and rental agreements that are attached to it. That means that you can begin collecting these rents on the next rental due date after your escrow closes. If this is your goal, you need to be sure to do your homework. Find out exactly what they occupancy rate of the property is before purchasing the property. Buying apartment complexes with full occupancy rates bring in the most immediate cash.
2) Passive Income
Passive income is money you’re earning even when you’re not putting in work. Commercial property offers passive, long-term income. This income may not begin immediately, though. As the new owner, you may have to do some upgrades or renovations to the property at first. This will not only please your current tenants, it will allow you to charge higher rents to new tenants renting your units. Once this is complete, all you have to do is put a strict approval process in place. This will ensure that you rent your units to qualified, reliable tenants. Soon, all you’ll be doing is waiting for your rental payments to come in from your tenants.
3) High ROI
Between the low home prices and record-low mortgage interest rates in the US, buying commercial property is much cheaper than it was in 2006. But, real estate experts will tell you that no matter how many housing bubbles burst over the years, rents in the US continued to rise. That’s one reason why many who invested in commercial property didn’t feel the sting of the housing crisis as badly as single-family property homeowners. Today, you can buy commercial property in the US at a very affordable price. One year from now, even if the value of the property doesn’t increase much, you can still increase the rental rates of your units. And, for new tenants moving tenants who move in next year, those rates can be even higher than what your current tenants are paying. Now, that’s a great return on your investment. If you’re thinking about buying a home, buying commercial property may be a more lucrative investment for you.
There are a number of great ways to invest from blog marketing to real estate. Commercial real estate is one great way to earn extra income offline.