Investment in stock market though gives you a very high return, but it continues to be extremely volatile. On the other hand, the less risky assets that are there are low on risk but have very low returns. As a result, investing in commercial property continues to be one of the most lucrative investments. It continues to be less risky but is able to give returns in the long run.
Some of the major benefits of commercial property investment are given below:-
- The most important benefit of commercial Real Estate investment is that it gives a regular income option with the leases that it provides. These leases are normally much more than stock yields.
- The commercial real estate investment, have a much better values as compared to any other forms of investment says Steve Liefschultz Minnesota. The value of the commercial property can go up, due to internal factors, which include proactive management which include cost effective improvement to the property which improves the desirability of the asset. There are certain external factors as well which increase the property value like supply and demand imbalances.
- Commercial real estate investment helps in placing debt on the asset which is much more than the original equity. This helps you in buying more assets with less money, thereby increasing the equity as the loans are paid out.
- When an investor invests in the commercial property, he takes loan from a bank. Then he earns more money by leasing that property. Thus he is able to clear off his debt and at the same time make some amount of profit.
- Investing in commercial real estate provides a superior hedge against inflation. While inflation directly affects all other forms of investment, but it does not affect the commercial real estate at all. The value of the Commercial real estate stands in direct proportion with the inflation. With inflation the value of the real estate also increases.
- The Commercial Real Estate has a security advantage over all other forms of investment. If the investor chooses the asset wisely, then he never has to worry about tenants. Even if one tenant leaves he will be able to get another tenant if the property location is chosen wisely. It is for this reason that the Commercial Real estate does not fluctuate in the same way as any other forms of investment.
- There is a lot of tax related benefits that you have, if you invest in Commercial real estate. Mortgage interest and depreciation deduction can shield a very large portion of the income stream.
If you require any help regarding commercial real estate investment you can directly be in touch with Steve Liefschultz Minnesota. He is a very reputed Minnesota –based banking professional and a real estate expert. He is the chairman and CEO of Equity Bank. Equity Bank is a self-governed financial enterprise which has been in the banking and the real estate industry of Minnesota for quite some time.
If you have any questions related to residential and commercial real estate loans and investments, you can get in touch with Steve Liefschultz. He is highly popular for his amazing competence in financial advisory.