Important Commercial Real Estate Investment Precautions

real estate investment photo
Photo by MarkMoz12

Investments in commercial real estate are the upcoming and highly lucrative area in the business industry. To have a commercial property of your own adds financial security to your life and to other business losses. Many big industrial giants engaged in several other businesses ensure to invest in commercial real estate as it pays too high with fewer investments. Owners can opt to offer as commercial space for lease or sell the property with high price. Both options provide financial security that can cover the loss in business or satisfy personal demands.

People looking to have own commercial real estate need to take care several things before buying or obtaining commercial space for lease. Here are the points that describe the precaution need to ensure before purchasing or obtaining lease:

Investment plans
People need to consider the seriousness involved in purchasing and selling the property, or investing for its developments. There are offers always made available by the big giants to invest in their property development. The returns are too high that just need a said amount to invest. On the other hand, purchasing a land and then modifying it to acquire high profits by selling, need better financial support. So, understand and recheck the financial support you can rely on during investing or developing a commercial real estate.

Compliant issues and legal documentations
Commercial property always involves several clauses that need advises from knowledgeable attorneys or legal advisors. Land acquisition, development complaints, construction safeties & causalities, infrastructure requirements such as space planners, budgeting and management, data and phone installers, furniture retailers, movers & packers, parking, construction certification, etc are several issues need to mention with solution in the agreement. All above-mentioned things get increase or decrease depending upon the possession, it depends whether you need commercial property for ownership or lease.

Contacting a competent commercial real estate brokerage
Investment, development and lease can only be lucrative unless you have contacted a genuine and research oriented business real estate agency for the business. The commercial property brokers will encourage you to opt for short term and long term investments as per your budgetary requirements. You want to be owner, want to share your contribution in developments plans for best returns or need office space for rent, every solution provided will satisfy your need with hassle-free investments.

These major three things need to be ensured before involving into commercial real estate investments. Contacting a wise commercial real estate agent will double the expectation by eliminating all hassles from the deal.

You Must Read If You Are Looking Into Purchasing Real Estate

real estate photo
Photo by miamism

Buying real estate can be stressful and a life changing event. However, the stress you get when purchasing a house can be lessened though knowledge. By reading the following tips, you can be ahead of the game and make buying a home a positive experience.

Real estate agents need to get a hold of their former clients during anniversaries and holidays of their date of purchase. When they hear from you, they will be reminded of how much you helped them when they were purchasing their home. End your message by reminding them you work on a referral basis, and ask them if they would be willing to refer you to their friends.ds.

Prioritize what you want before negotiating a final price for real estate. Identify all the issues on the table and set your expectations for each of them. Your convictions and expectations will be useful for prioritizing each goal. However, it is likely that you will not get every one of your expectations fulfilled. Remember this and stay flexible on the less important issues.

If you want to buy a spot for a business, ensure that it is located in a good area with reasonable stability and opportunities for growth. Open your company in a nice neighborhood to ensure you get more customers to your store. Ask your real estate agent where an ideal location to open a business is.

Doing your research beforehand is vital when you get into the rental property business. Even for rental property, you should look at some important features before purchasing. The first key feature is sustainability. Will the property come to you in good condition and how much maintenance will be needed to keep it up? The next key factor is location. This especially goes for rental properties. A good investment should be in a safe neighborhood with access to different stores, schools and job opportunities. Also, make sure to take into consideration the average income in the neighborhood. An area with higher income is preferable to those with a lower, average income. You should also keep in mind that concerns about location are not as high a priority for high rent areas. Locational issues do become more of a factor in areas with a lower rent.

Have a pre-qualification letter from a reputable lender before beginning your home search. It would be a shame to find the one home you’ve been looking for and then discover that you can’t get a large enough loan to cover it. Securing a loan can also take a really long time, you don’t want to have to deal with that at the very last minute!

If you’re interested in investing in real estate, it’s best to consult with a professional real estate agent. Agents and brokers may have access to specialized directories and listing search tools that make your search for the perfect property much easier. Tools that they have in their arsenal include special software programs that sort and search the listings on MLS. When searching through MLS alone, these tools can help you find some great deals that could’ve been missed.

Don’t pay high premiums on homes just because of a nice view. Even though you may love the view, when you resell the house there is no guarantee that prospective buyers will value it as highly as you do. So, you should purchase a home if you like the view, but don’t pay too much.

When thinking about moving, take some time to explore the area around your potential purchase on the world wide web. There are several sites online that give statistics for even the smallest city. Before buying a home, research the unemployment, population and salary margins.

Buying insurance for your home should be your very first step, before actually moving anything into the house. If you put off buying insurance, you’ll be sorry if there is an unpredictable act of nature that causes irreparable harm.

This advice will be a perfect way to get started in the home buying process. By following them, you can make sure you don’t commit common mistakes. Enjoy the shopping experiences, and your new house!

Why Real Estate Investment Includes Risk Analysis

real estate photoThe bottom line about any real estate investment analysis is that it is a risk analysis. If risk was not an issue with investing, and all the results of any given investment were known with certainty, than creating an analysis for any type of real estate investment would simply be a matter of arithmetic. But the truth about real estate investing is that many factors come into play (i.e., the economy, tenant trends, etc.) that make it impossible to ever know with absolute certainty enough about a typical property to remove every element of the unknown.

Since the ability to accept varying levels of risk will differ from investor to investor, many simply avoid real estate altogether and opt to put their money only in relatively risk-free investments such as government Treasury bills. But the price for this lower level of insecurity, of course, is a lower rate of return. Why, because a relationship always exists between risk and rate of return. Therefore, when investors are attracted to the certainty, they in effect force down the rate of return they are willing to accept as a tradeoff for their unwillingness to accept uncertainty.

Okay, so what about the risk takers? What can investors who prefer to collect the higher rates of return associated with real estate investment do to deal with (and perhaps minimize) the ambiguity? Investors must exploit tools that can potentially measure this risk. One method is by applying what is known as a “probability distribution” to prospective real estate investment opportunities.

For example, rather than using just one set of rents to ascertain potential cash flows and returns for a rental property, the investor should consider several rent scenarios that reflect an estimated probability of their occurrence.

In my real estate investment software, for instance, a form is provided that allows users to apply three different rent scenarios to a rental property. This way, rather than just having to accept whatever rents are presented by the seller, the investor can analyze the cash flows and returns based upon a range of rent probabilities (i.e., most likely, somewhat likely, and not likely but “wow, wouldn’t it be great”).

The logic is straightforward. Say, for example, that you’re doing an analysis on a ten-unit apartment complex made up of ten two-bedroom, one-bath units each reportedly with the potential of renting for $700 per month. My own experience warns me that “potential” rents may (or may not) be likely, so I always prefer to run my own rent scenarios. In this case, then, you would use our Rent Scenarios form and assign three rent probabilities based upon your own measurement of risk, and instantly you are the results so you can analyze what impact each rent might have on cash flows, rates of return, and profitability. The outcome if monthly rents are more likely at $650, for instance, could affect your willingness to chance buying the property.

This is only one of a variety of mathematical and statistical approaches to risk analysis that will help you address the uncertainties of real estate investment. But you get the idea. The best way to deal with uncertainty is to measure it. And the probability distribution we illustrated for rents is a good first step.

You can see a screenshot of our Rent Scenarios form at http://www.proapod.com/Tour/basic/screenshot_4.htm

Are You Really A Real Estate Investor

By accident, I believe that our industry does us all a disservice. How? By calling us real estate investors.
How many of you call yourselves real estate investors? Lots. How many of you feel a little queasy when you introduce yourself as a real estate investor? (No need to confess you just need to recognize that feeling).

Do you want to know why you may be feeling queasy? I’ll tell you. It’s because of the incongruent language we are using on ourselves. Let me prove it while helping bust the number one fear of real estate “investors”.

What do you think of when you hear the word investor?
I bet it’s “cash” or “credit”. Right? Maybe something that you feel that you don’t have. So if your business card declares you a real estate investor and you don’t have any cash, do you feel funny, or out of integrity, or incongruent? Maybe a little?

On the other hand, what do you think of when you hear the word entrepreneur? The answers to this question usually range from “opportunist” to “opportunities” to “ideas” to “deals”, etc.

The definition of an entrepreneur is someone who uses the time, talent and treasure of other people to realize their idea or vision. Read that again because this a subtle but important point about your real estate success.

The number one limiting belief of real estate “investors” is “I cannot do this business because I have little cash and/or bad credit.” And if your subconscious holds this belief, guess how hard you are going to work to find deals. Guess how many deals your are likely to do. That’s right, you will do ZERO.

Good news! This limiting belief is easily busted.
You are not a real estate investor. You are a real estate entrepreneur.

What’s the difference? Well, entrepreneurs bring the deals to the money. Investors bring the money to the deals.

By DEFINITION, entrepreneurs are not expected to use their own cash. They are expected to raise cash for their deals and projects. That’s what we do. We find the one thing that is much more valuable than the cash which is the deals.

Money is easy. Finding the deals is the part that requires a little work. But most real estate “investors” get hung up in marketing or making an offer because they don’t have the cash sitting in their checking account. They freeze.

You need to declare yourself a “Real Estate Entrepreneur.” That’s what I do. At this stage of my life, it’s more fun being the entrepreneur and putting deals together. It’s my form of creativity. It’s my art. Being the investor and putting up the cash is OK but it’s kind of like being the guy that furnished the paint to Michelangelo. Nobody remembers the paint supply guy.

I urge you to adopt 2 new affirmation(s):
I am a real estate entrepreneur.
I am leveraging the time, talent and treasure of others.

Real Estate Investment Tips Young Investors Can Follow

Real estate investment is not really one of the major priorities of young career persons. Many of these professionals choose to rent an apartment or a condominium unit and then save some part of their paycheck for a car investment. But investing in a house is really one of the best financial management strategies that young people can get into especially if they have a smooth-sailing career and they have quite high income. This kind of investment can also help them learn the value of making responsible monetary decisions. It is best to start investing in a house at a young age. If you want to start learning the real estate industry, here are some tips to help you achieve success in investing.

Always save money Every time that you receive your paycheck, make sure that you allot some amount for your savings to help you be financially independent later in your life. If you start to save at a young age, the amount you will accumulate can be a big addition for the down payment you will give for the house. This will allow you to pay lesser monthly fees for the mortgage.

Keep a good credit history It will be easy for banks and lending companies to grant your home loan approval if you have a good record on your credit accounts. Paying your bills on time and every due date are some ways to maintain a positive track for your credits.

Define your budget Calculate all the money you have including your savings and estimate how much of it you want to allocate for the house. One major payment you have to consider is the down payment. Furthermore, you should also allocate some funds for the renovations, repairs, maintenance and mortgage fees you have to pay.

Research You have to learn the basics of real estate industry before you get into it. There are several helpful resources from the internet you can read that contain useful and basic information about investment and real estate. Being equipped with the basic knowledge will make it easier for you to talk with real estate agents and professional. It will help you avoid getting into a bad real estate investment.

List your conditions Create a detailed list of the qualities you are looking for in a house. Also include in that list the needs and wants you have for your house. This will make it easier for you to locate the house that best satisfies all those written in the list. You should also create a list of your reasons why you want to invest in a real estate property to give you focus and motivation to pursue this endeavor.

Look for a good realtor A realtor can be very helpful for you to get the best deal so try to hire one that is dependable, trustworthy, and unselfish and will loyally work exclusively for your own interests and advantages.

Be open-minded Ask opinions from other people that matter to you and have an open mind in all the insights and comments they will give you about the property. Opinions of your friends and family who have bought a house already can be helpful to you when making your own decision.

How To Make Real Estate Decisions That Work

You can make a lot of money through commercial real estate investments. However, you have to be patient. Take the time to research each property you’re considering as well as studying general commercial real estate principles. A lot of people just like yourself become successful at real estate investing by keeping informed and applying the tips in the following article. Stick to the advice presented below to help you succeed in the world of commercial real estate.

Make sure you have enough cash flow available for you from family, friends and any professional lenders accessible to you. Contracts should be devised that either provide you with a fixed rate of interest on the loan repayment, or provide them with a percentage of what you make from the property.ty.

Once you have signed a new lease for a property, your next priority should be your rent strategy. The effectiveness of your strategy will have a significant impact on the success of your new investment. Know how to plan for the rent you wish to charge before talking to a prospective tenant. This can help you keep targets and set a benchmark for your investment.

You need to do this so that all terms match the pro forma, and also the rent roll. If you do not look over these key terms, you could find a term that was not considered in the rent roll, which could cause a change in the pro forma.

Keep your commercial property occupied to pay the bills between tenants. Remember that if you have empty units, you have to take care of them. Maintenance costs on empty units can add up. If you have several properties open, you should ask yourself why, and attempt to correct the issues that may be driving out your tenants.

In order to learn more about the commercial real estate market, find a website that caters to investors of different skill levels. Having a great base of knowledge will give you the tools to complete every part of the buying process with confidence, leading to solid decision making.

It is critical when you are in the market for real estate that you know how to discern between a good deal and a not-so-good deal. People who deal in real estate on a professional level can spot a great deal immediately. They have their exit strategy already planned out, and therefore, they know when to quit a deal and when to stick it out. They have the experience to show them when repairs are necessary, how to correctly calculate their risk and which types of properties will help them to meet their financial goals.

When you are buying or selling commercial real estate, always negotiate. Let people know what you want and make sure you are asking for a realistic price.

If you follow the advice you have learned in this article, you will be well on your way to a great start. If you use the tips provided in this article, you will see why so many people are successful at commercial real estate, and you can start to reap the rewards.

Month Property Options Coaching Program Real Estate University

What is Property Options?
An Option is a legal instrument by which a choice is granted to acquire a given property.
Simply meaning, an Option is a document that gives me the choice to buy, on my conditions, or not to buy at all. If I choose to purchase, the Seller is absolutely committed at the original strike price.

Short Options
The greatest advantage you have with Short Options is the ability to create cash in a very Short window of time. Short Options are typically somewhere between the day of signing, through to 6 months. The remarkable thing about doing a Short Option is the fact that it no longer requires the process of doing a full Development Approval. It involves locating sites with development potential and on selling them to a developer.

The success of short options lies in identifying potential, but you will need to be very specific with information, research, comparables, building costs and all the other intricate parts of assembling deals. In fact, if you are able to identify intrinsic value, it allows you to be able to assemble a Short Option.

They are a lucrative part of Options and offer the kind of cash flow that most people seek in the shortest possible timeframe.

Long Options
As the name states, Long Options work on a longer time frame. They necessitate us engaging consultants and seeing the Developmental Approval process through to completion. We then on sell our Option to a developer or builder; we are giving them a turn-key solution very attractive. Of course our greater effort is rewarded with greater profit. There lies the advantage of the Long Option.

Mark Rolton Australia’s Number 1 expert has made millions of dollars using Property Options. To get the best real estate buying advice and to find out more about and how to make massive profits from Long and Short Options, join Mark in his 12-Month Property Options Coaching Program.

12-Month Property Options Coaching Program.

The Complete Property Options A-Z System.
You get Mark’s complete system in home-study format so you can start immediately implementing all the property option strategies that will accelerate and fast-track you to financial freedom fast.

The Critical Legally Binding Option Documentation.
Normally you would have to spend thousands of dollars to get this options contract; however as part of my course, I will give you the exact document I use to secure multi-million dollar deals.

The Paint-By-Numbers Options Feasibility Software.
Figuring out if a deal is red-hot or not, you’ll get the exact software I use that tells me instantly how much I stand to make from the property I’m currently researching.

3-Day LIVE Advanced Property Options Bootcamp (This is 3 seminars in 1)
Ill take you to the next level and show you all of the creative ways you can use options to either make a quick $100,000 or a multi-million dollar deal. This advanced bootcamp is broken up into 3 sections; Money Maker, Portfolio Builder and Property Options Peak-Performer.

2-Months Support and Coaching.
My hand-picked team will help you and guide you through your early steps of investing using my system. They will be available to you via phone and email.

Special Bonus: Let me be your Joint-Venture partner.
If the deal is too big for you to fund, and youve followed my system then I’m more than happy to put up 100% of the money that you require to get the deal over the line. You can literally make hundreds of thousands without outlaying much cash, using me as your joint-venture partner.

EXTRA Special Bonus.
Pay in full today, and you can bring your spouse or partner to the 3-Day Advanced Property Options Bootcamp for free.

Mark Rolton is a brilliant real estate mind and visionary in the property industry. Mark has used his skills to make millions of dollars in real estate and would love to teach you these lucrative strategies at his Real Estate University 3 Day Live Events, in the hope that you will do the same. Join other passionate property investors in an atmosphere of fun and cutting edge learning that will blow your mind. No one else in Australia knows as much as Mark about creating cash flow using Real Estate.

Creating innovative solutions within your property development portfolio will reap profitable rewards securing your financial future within an achievable time frame.

Investment Diversification with Real Estate

This year, investment in the stock market is making many downright jittery. Though overall the stock market does seem to be hovering around the 10,000 mark, many investors are plagued with uncertainty about short and long term investments in the stock market. Will stocks go up or down this week? Is now to time to keep money in the market? Or take money out of the stock market?

As a real estate professional, I always advise people to continue to invest in property. With so many bank owned properties flooding many different markets, real estate investors are actively purchasing homes and investment properties and obtaining some great deals right now.

John Starke, an Investment Advisor and Financial Principle with American Beacon Partners, says that many investors have grown tired of the risk involved in purchasing equities, mutual funds, and other types of investments. Prior to the sharp downturn in the market in 2008, investors goals were to accrue money through appreciation. “Rather than nervously watch their portfolios go up and down, investors want a more stable income,” noted Starke. He sees a rise in interest in Real Estate Investment Trusts (REITs), Tax Free and Corporate Bonds, and even some Corporate CDs. “Many investors are pulling their money from equities and mutual funds and opting for investments that pay a decent, regular return on their money,” said Starke.

In my everyday real estate transactions, I see investors pulling large sums of money from the stock market and putting it into the purchase of homes and properties in Virginia. I have taken the time to ask real estate investors their opinion about stock market investments. Many have decided that the stock market is not for them right now. One investor, J. D., purchased a property in King William County, Virginia that was in foreclosure for $90,000. She will spend approximately $4,000 to prepare the property for the rental market and be able to collect a monthly income of $1,000 from her investment. J.D. told me “I feel the time is right to start investing in real estate again. I stopped four years ago when property prices got out of hand. I intend to do even more real estate investment now.”

Another client, who plans to retire in a few years, is selling one commercial property investment in order to purchase a strip mall in the Western Virginia town where he plans to retire. He will pay the purchase price and invest approximately $40,000 into the strip mall to prepare it for the commercial rental market. He told me, “I am tired of having a business that I have to work at everyday. I want to have an investment that will work for me as I am planning to retire in about two years.” His upcoming shift in lifestyle is motivation for his new commercial property investment. Note that hes not selling one business and putting the money into the market. This may have been the trend for a retiree five years ago but not in the new economy.

Finally, H.G. in Hampton, Virginia made a wise move with money he once had in the stock market. He purchased a condominium for $50,000, invested $2,500 in the property renovations, and is now receiving $850 per month in rental income for the unit. HG said, “I am making more of a return from my property investment than I would in the stock market, and I also receive a tax deduction to boot.”

There are of course risks in real estate investments. A tenant could default on the rental agreement, or a property could remain vacant for months on end. That is why it is imperative that real estate investors hire experienced and knowledgeable property managers to maximize their investment. All of the property investors mentioned in this article are using my property management services for their real estate investments. Other risks include unforeseen maintenance and repair issues. This is why it is important for property investors to put a portion of their profits aside to reinvest in the home, condominium or townhouse they purchase.

Where property investment is concerned, even these risks, when anticipated and well-planned for, are small compared to the uncertainty of stock investments.

Shawn Tully, Senior Editor at Large for Fortune magazine, published “2010’s Coming Stock Market Crash: 1987 all Over Again” in May 2010. He states that stocks are still overpriced. He predicts a low return on investment (or a loss) as an inevitable outcome of this scenario. Tully bolsters his opinion with these astute observations: “Here’s how I see the odds. The chances are about one in three that we suffer a huge, wrenching correction in the next year or two similar to the one in 1987. That possibility is so high because stocks are so startlingly expensive. Another high probability event is that markets go on a long sideways grind, with smaller drops along the way. What’s extremely unlikely is that the market rises substantially from current levels and stays there for any extended period.”

Experts within the financial industry may be reluctant to put forth the strong opinion that Tully articulates. Still, there is no denying that investors have undergone a major shift in perspective since the financial crisis of late 2008 culminated in a recession, took hold of the United States and spread to other countries.

People will always need a place to live. With more and more families sadly experiencing foreclosure and dislocation, renting will be their most likely option. More rental properties will be necessary to fulfill housing demands. Investors need to take a serious look at property investment in their areas, and take steps to purchase viable homes even if they are in need of some repair or upgrades.

Visit http://VonCannonRealEstate.com to view potential investment property listings in Virginia in Williamsburg, Hampton, Newport News, Yorktown, Richmond and Northern Neck areas such as Matthews, Northumberland and King and Queen Counties.

The Benefits of Hiring a Real Estate Lawyer for Your Home Purchase

If you are purchasing a new home, there are often mountains of paperwork that needs to be sorted through. These include all the legal papers, titles, and all of the required state and city disclosures. Sometimes, it helps to hire a real estate lawyer so that you can understand them and not just muddle through.

One thing that a real estate lawyer may help with are contracts for property closings. Most home buyers are not aware that an offer can be made based on the approval from an attorney, allowing any necessary papers to be perused by the sellers. His responsibilities are to make sure that the titles are correct, get all the proper documents registered, and make sure that all the owner’s paperwork is legal. He will also work with the financial institution so that your home buying experience can be less stressful.

A real estate lawyer can also run a history report on the property for you so that you can make sure that there are not any long term, short term, or tax liens on it. This could happen more often if you are buying an older home that has had several owners. You can also find out if there are any easements or restrictions on the use of the property that need to be explained to the new owners before any paperwork is signed.

Make sure that you consider only a licensed and experienced real estate lawyer, as there are some those who are not attorneys who claim to do the same work for you for less money. This is possible, and they will likely do a good job, but, only those trained in law can work with the courts for you, and will only operate with the highest level of ethics. They must carry insurance that covers any errors or omissions, just in case damages are discovered later, because those can happen on occasion.

The lawyer that you hire will work with your financial institution to review all the paperwork and adjust the terms if necessary, all for your benefit. This includes taxes and insurance, and making sure the buyer is protected in case problems are found after the bank has transferred the title.

Finally, real estate attorneys have certain duties that make them worth the fees they charge. These include helping with negotiations with the sellers, reviewing the agreements for the purchase, be with you during closing to make sure that it goes smoothly, and making sure that the deed is worded correctly and nothing is omitted. He can also make sure that all the checks and pre-purchase insurance payments are taken care of before the buyer signs the contract.

If you do your homework and find the right real estate attorneys, your home buying experience can run smoothly. This will leave you with the peace of mind that you can enjoy your home for many years to come.

What Are The Most Useful Real Estate Investment Guidelines

Investment real estate is one of the most favourable opportunities of making huge profits. The number of investment opportunities in real estate never slips down and you can always consider it as the best way to invest your hard earned money. However, you should be familiar with real estate investment guidelines to ensure that you are investing at right place, with right people and at right time. These guidelines are of great importance if you are a novice investor in this field. So, here are few guidelines in this direction to make your start.

Proper Research of Real Estate Property

Real Estate Investment Property should be your major concern while understanding the real estate investment guidelines. You should have the flair to evaluate the property on the basis of its market value as well as its future prospects. It doesnt matter whether you choose commercial or Residential Investment Real Estate. What matters the most is the assessment of future benefits of the property. For this, you must also take into account the location of the property and surrounding facilities like schools, hospitals, shopping areas and others.

How Will You Use the Property?

You must also have the capability to decide what use the property will be put in by you to earn maximum advantages. You can use real estate investment guidelines to decide, whether you will keep the property for your future settlement, or you want to sell it when the prices rise in the future. Also, you can give the property on lease for some duration and earn continuous flow of income.

Investing at Right Time

You must learn Real Estate Investment Guidelines to decide what is the right time for investing money in the real estate? The real estate investment market is prone to fluctuations and thus, you should not end up buying a property at a price higher than its expected market price.

Hiring Best Investment Broker

It is required to hire the services of a good real estate investment broker to make successful investments. You can take into account the past performances of the broker and also his reputation in the market. You can evaluate the proficiency of a real estate broker by asking your questions and measuring his knowledge in the field.

All these real estate investment guidelines can help you in the long run to make considerable profits. You can learn and utilize these guidelines to become an expert investor and add value to your bank balance. A visit to websites such as callowayinvestments.com will further educate you on the subject.

Commercial Real Estate An Ideal And Limitless Investment Idea

When it comes to the best investment ideas, the commercial real estate can count for a great idea and especially if you have enough money to invest. The venture normally comes with numerous benefits which every investor will find ideal and worth considering. The commercial real estate idea is ideal in that it goes beyond the residential and single family properties and the demand is always on the rise no matter where the property is situated. With many people looking for office space and apartment buildings, the idea has been found to be lucrative and always rewarding for many investors.

One of the greatest benefits of the commercial real estate idea is that it provides you with a number of options and enhanced range on your ventures not to mention that it also comes with an enhanced possibility of great returns. It is however important to look at this kind of an investment as a major task that will definitely require a huge chunk of money and therefore do your calculations well for the realization of the desired results. There are many benefits that every commercial real estate investor will be able to enjoy and these always make the investment a worth risk to take.

Benefits of commercial real estate investment
One of the most notable benefits of investing in the commercial real estate is in the lucrative rental rates that are associated with the venture. This is especially the case when the building is located in an area where there is high rate of business. It is therefore easy to enjoy huge monthly returns and especially if you are in an area where the construction of such a building in regulated by the law or the land.

Unlike the other types of real estate investments, the commercial real estate normally involves space measurements that are done in square foot and the price for this is normally high. Commercial space all over the world and especially in the up market places is normally rented at a rate of more than $70 USD per square foot. This therefore translates into a huge amount of money at the end of the day.

In many areas, the commercial real estate also benefit the investors in that they come with prolonged lease agreements which allows for continuous occupancy. Unlike their residential counterparts which might not work the same way, the commercial units have an assured cash flow every month for the number of years under which the agreement is made.

Due to the fact that many tenants would want to establish a continuous link with their clients without destabilizing their businesses, the long agreements normally work to the benefit of the investors.

Additionally, commercial real estate is always on demand and especially if they are strategically situated. Hardly will you here of an unoccupied space especially in the busy streets of any given area. The benefits associated with the commercial real estate can be broken down into various categories but there is no doubting that this is one of the best avenues for any serious investor.

What’s A Real Estate Bargain Sale For Commercial, Industrial And Retail Properties

You’ve probably noticed in the news that real-estate markets across the nation are starting to see a little increase in activity and sales prices. That’s fantastic news for the typical seller, but for sellers having distressed property sale prices and surely days-on-market figures may not be looking up much. The truth is it is tough to sell an underutilized or distressed property in any market as traditional purchasers view it as a high risk investment given its condition and the amount of capital that will be necessary to get it into good running condition. So what’s an owner of distressed commercial, industrial or retail property to do? Think about a real estate bargain sale!

What IS a Real Estate Bargain Sale?

A bargain sale real estate transaction is an alternate to traditional selling techniques that allows the seller to pocket cash at closing while getting a substantial tax deductible donation that usually saves them from paying more in taxes on their regular income than they’d receive cash at closing. These kinds of sales are cash, meaning no contingencies to meet and a fast, comparatively painless closing. In a real estate bargain sale transaction the seller is given a bit of cash at closing to cover their assessment and closing costs, additionally they get a non-profit donation deduction which could be used on a quarterly return if they’ve sufficient income, or it could be applied to their tax returns for around 6 years. Real estate bargain sales often bring a higher sales price for the property than traditional buyers would offer due the IRS Rules regarding assessing bargain sale real estate in Publication 561 . So between the fast cash, charitable donation and higher sales price these sales really are a fantastic option for sellers of distressed properties!

IRS Publication 561

As everyone knows in this day and age if it sounds too good to be true it generally is. Sellers pursuing real estate bargain sales do not need to panic about a scam. The Bargain Sale Exchange was created by the government in Section 170 of the IRS Code and predates the 1031 Exchange, making it a long running safe and proven technique of selling distressed or underutilized business, industrial and retail properties. How does the bargain sale offer a greater profit for sellers than a traditional sale in the real estate market? These sales are bound by the IRS Code Section 170 and are more explained in Publication 561 requirements for real estate appraisals. This kind of appraisal allows the appraiser to assess the value by a combination of three methods of valuation: the Replacement Cost Strategy, the Market or Sales Approach as well as the Income Approach. They then take a weighted average from those techniques and may also think about the highest and greatest utilisation of the property when determining its value even if that use differs from its current use. According to IRS Publication 561:

‘Fair market value (FMV) is the price which property would sell for on the open market. It is the price that might be agreed on between a willing purchaser and a willing seller, with neither having to act, and both having reasonable knowledge of the relevant facts.’

Valuing a property in this manner removes the factors of time constraints and carrying costs on the seller’s part. Therefore the property can be appraised for a higher value than it might be in more traditional sales which use only the Market or Sale Approach or the quick bank .

Bargain sales of real estate offer an excellent alternative to more traditional selling methods for owners of underutilized or distressed property. As real estate bargain sales are cash transactions, closing is fast and simple. Under the terms set by the government the seller is entitled to a charitable donation deduction due to the sale and also pays minimum capital gains taxes on the cash obtained at closing. Thus all that cash saved by not paying as much in income taxes from gifting real estate via a bargain sale to charity can be reinvested in your business!

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Preparing a Commercial Real Estate Agreement

If you are considering investing in real estate property for commercial purpose, it is better to consult a legal practitioner from the beginning. Georgia commercial real estate laws are a complex web, and you would need someone who has in-depth knowledge regarding it. Only a real estate attorney can take care of the legal aspect of such a huge investment.

Suppose you have already found the right property in Atlanta and want to buy it. You inspect it on your own and have professionals assess it as well. It fits your requirements and budget perfectly and you want to seal the deal. Next is the task of creating the purchase agreement. Preparing and drafting this requires competent legal guidance.

A legal professional with proper understanding of the state laws and their implications would know exactly what to put in the contract. However, here are a few terms that are essential in all real estate purchase contracts.

Names of the parties involved in the transaction
Exact description of the property and any other assets included in the purchase
Purchase price as well as mode, method and time of payment
Title abstract and insurance related details
Allocation of property taxes and utility bills
Closing date and delivery of possession
Escrow
Zoning and other relevant issues
Warranties
Liability clauses

Apart from these, it is important to include one other detail – what happens in case there is a breach of any agreement term by any of the involved parties. In case of such an incident, it is better to know what you can do to remedy the situation lawfully. Foreseeing problems and preparing solutions can come in handy when the need for it arises.

Creating a concrete and complete purchase contract can help you avoid unnecessary hassles later. It helps you prevent disputes and expensive litigation. However, if there is a legal dispute concerning the interpretation of the terms of the agreement, you may have to avail help from your Atlanta real estate attorney to work on your case.

By now, you must have a clear idea about the importance of legal counsel in dealing with such matters. Most businesses retain in-house attorneys to handle the drafting of such contracts. However, you may have to opt for a specialist in litigation if there is a dispute regarding the terms and conditions of a commercial real estate purchase agreement.

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