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Commercial property has long been listed on the positive side of a businessperson’s portfolio. Whether you choose warehouses, industrial complexes, mixed use buildings, or zoned lands, there can be a thrill to know you have managed to purchase some investment property. Here are four reasons you should continue to invest in commercial real estate.
Appreciation Value
For as long as humans have kept books, commercial real estate has been found to be a great investment because its appreciation value far exceeds most other types of investments. Steven Taylor landlord looks at the long-term value of the properties he purchases. That means you take the purchase numbers and balance them against the city’s supply and demand ratio to find how fast the property value is expected to appreciate.
Tax Benefits
Commercial real estate owners have a tax advantage over other property owners if they have properly structured their loans. These deductions can include interest expenses and depreciation that can help defer taxes. Keeping records on all upkeep and maintenance is essential, so contact a CPA for more information.
Income Stream
The biggest benefit of owning commercial properties is that the mortgages on the property are covered by the secured leases of the tenants. When you have assets that pay for themselves and sometimes even generate an additional income stream, it can be a huge boost to your portfolio. Most people that own this type of property pass ownership down through family lines where it continues to produce a positive income stream for the children.
Inflation Protection
As stock markets rise and fall, inflation seems to follow. For a commercial real estate owner, inflation can mean that higher wages and an increase in the broader economy allow for increases in rents or other charges on commercial space. This, in turn, provides more income for the property owner that is considered to be a hedge against inflation.
Commercial real estate investments can be a great boost to anyone’s portfolio. Consider investing in a commercial property near you today.
