When you are sick, do you go straight to Google and try and cure your ills without calling your doctor? I truly believe many people do and mostly for the reason of not wanting to visit the doctor or spend the money to REALLY see what their ailment is.
Shortcuts along with thinking you are smarter than the doctor or save yourself a buck can harm you in the long run. The same thing holds true in commercial real estate investment property.
There are no shortcuts or quick Google search answers!
If you are not a long-term investor with vast experience of ownership and knowing ALL the ups and downs and traps that make a commercial real estate investment SUCCEED, utilize a commercial real estate consultant that specializes in the field that you are trying to enter.
Most are paid by the sellers not by you so you gain knowledge and said real estate broker is paid at closing by the seller when you move forward on the right investment. There are many various factors that influence the final outcome of the investment property or income property and it is NOT just the cap rate that is asked for the property. The cap rate can be too low or high and has nothing to do with the true factors that justify a fair price to pay.
Don’t Buy Commercial Real Estate Investment Property Until You Read This…
What if your tenant is paying a low rent based on the same property type in the neighborhood and a much higher rent is justified in the future? What is so important about the present cap rate based on a inappropriate rent, none! What if a change in the ingress and egress of the street will occur two years from the day you purchase your commercial real estate investment property, a pending disaster is likely to occur?
What sales of the current tenant have anything to do with your decisions? Do you really know what good sales are for that tenant in the first place? Since commercial real estate brokers are usually paid by the seller and have years of experience on the topics, don’t try to purchase on your own without a professional protecting your back.
Make sure your professional real estate broker is not just trying to sell you their own listings but give you a wide variety of choices and options to increase and protect your investment dollars. The best way to determine if your broker is protecting you verses their own fees is to see if they offer a variety of options in achieving your end goals and some DON’T include them getting a fee.
It is similar to asking if a persons X spouse is your past husband or wife a ethical person and if they say yes that is great sign for your future relationship whether a triple or double net property or a 1031 trade don’t try on your own if you are not up to date on all the various options and conditions of the market place without professional help.