Investing in commercial real estate can be a wonderful decision when you are looking for passive income. Done right, you can set yourself up for recurring cash flow and long-term property appreciation among other benefits. However, real estate investment is a big deal – financially speaking.
Before beginning your quest for the ideal commercial property to buy, it’s best that you do your homework. This is known as due diligence. Basically, you need to be fully aware of the following aspects of the property before closing the purchase:
The condition of the building
From ramps and stairs to floors, entry lobbies, roofing and façade walls and fire protection systems, it is important that you establish the property’s structural integrity. A building consultant or inspection specialist can help you audit these to establish any hidden faults that you would otherwise miss.
The property’s location
This is one of the most important considerations when investing in any type of real estate. First, you want to be sure that the property is properly zoned. Next, you want to be sure that the property is readily accessible and that it is close to essential amenities like public transport.
The property’s title
A property title basically details all the information you need to know about the property in question. As a buyer, you want to be sure that the land the commercial property you are interested in is sitting on has no liens, easements or incumbrances. Additionally, you should ensure that you are buying the property from its rightful owner. This is where a title search comes in.
A real estate transaction involves several layers that you must navigate before closing the deal. Performing substantive due diligence can save you from unpleasant surprises that can put your investment at risk.