Debunking Myths about Investing in Commercial Properties

Buying commercial investments is something that people always warn potential investors about. They'll say "Well, unless you have a lot of money, it's better to invest in residential real estate." But this is one common misconception about commercial real estate. You don't have to have a lot of money to invest; you just need to be smart about it and to invest in the right sector.

So, what are the other myths about commercial real estate?

The number one myth is that buying commercial investments and being successful in them cannot be done by ordinary people. Why not? First, they say that it takes a lot of money. Second, they say that it takes a business genius to pull it off. And third, well, they just say you're simply not qualified to do it.

But, why not? I say all it takes is someone who's determined and lots and lots of research and you'll do fine. I was just an average employee when I stumbled upon self-storage investment, which is one of the more stable sectors of commercial real estate, and I can say that I did good. Of course, I was very determined and I also did a lot of research before I ventured into it. And guess, what, banks love self-storage and so I bought my first facility with very little cash. This is a prime example of how commercial real estate is definitely for ordinary people.

The second myth about commercial real estate is that when it comes to real estate investment, it's better to invest in residential real estate-especially when you're a newbie. First, they'll say that the capital is a lot lower. Then, they'll say, well, the economy is bad now so now's the time to invest in residential real estate as houses are selling at a loss. And third, they'll say that well, even if the value goes down, at least you have a house.

Why is this thinking wrong and definitely a misconception? First off, banks are very cautious when handing out loans and they hate residential short sales. So, first, you'll have trouble getting capital. Second, the market is currently saturated with residential brokers and it'll take much effort for you to land a sale that's worth your money. And third, this is what the owners of houses that are selling at a loss were thinking when they bought their house-but when they need it the most, they cannot even get a return of their investment, losing hundreds of thousands of dollars in the process.

The third myth is that the best sector in commercial real estate is apartment complexes or multi-family homes. Believe me, this is definitely a myth because I've been there. It's affected by a lot of factors that you really don't have any control over. For instance, my friend was already a millionaire with more than 20 apartment complexes when 9/11 hit and he almost went bankrupt. It's a very volatile market with a whopping 58% bank loan failure rate. This is why you'll have a lot of trouble asking banks for loans when you state that you're buying an apartment complex.

So, what's the best sector then. Based on experience and lots of research, office space investment is the best and safest bet during this time of economic recession. Banks love it because it has the lowest bank loan failure rate at only 8%! What's more is that it's unaffected by the recession because whether the economy is good or bad, people need a place to operate their business! This is because us Indians are pack rats by nature.

Looking for an opportunity to buy office space in Noida?

With so many misconceptions out there to throw light on, it is important that as an investor you search for an amazing project before you dive into the commercial space investing. And for limiting your hard work, we have the same kind of project for you – Anthurium. A business park of its kind is available for investment in sector-73, Noida. With Artificial intelligence (AI) ready office spaces, mechanical car parking, yoga rejuvenation center, gymnasium, shopping center, sky lounge roof top restaurant and quick connectivity from all the major transport systems, the project is nothing less than a dream project for its investors.

For more information on what, how and when to invest with Anthurium’s office space in Noida for your business needs.

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Created on Sep 27th 2019 04:43. Viewed 393 times.

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