Residential or commercial property investment?

A commercial property investment would be my choice. I believe there would be less drama to deal with. Your maintenance would probably be expensive but your tenants are confident enough to make their business successful which means a steady source of income. I can't really think of any cons. The small commercial business park would be very tempting to me.

 

If given the opportunity to invest, I would invest in a commercial property. This makes sure that your asset brings money in to your bank account. A residential investments requires you to keep it maintained, but not earning you some money to cover it.

 

If I were considering doing either - I would most definitely go for commercial letting.

As even though investing in commercial property requires a greater financial outlay than that of residential property - because commercial property leases - unlike residential property leases - are generally for a much longer time period and are more often than not secured by a bank guarantee - which when combined with the fact that most commercial property leases hold the tenant responsible for maintenance and repairs and not the landlord - means that these costs won't be eating up your profits and therefore - providing you are wise and choose the right area - you are much more likely to see a return on your investment.

 

if I already owned my own residential property and money weren't an object, I'd definitely invest in commercial property. I'd ideally like it in some sort of decent, sought after area such as a CBD. Clients who can afford to operate out of those types of areas are usually the ones with money, plus they wouldn't want to tarnish their reputation by defaulting on payments LOL

 

Commercial property is more likely to make an investor more money than residential property but if you can afford it then it's always better to diversify your investments. Invest in both commercial and residential property.

But I'd prefer owning REITs any time.

 

Since I am not expecting much from my retirement, I am aiming to build a residential apartment or a house that I would rent out for a steady income. A commercial rental is more complicated since permits are required and taxes needed to be settled while renting out a residential house would save me from those hassles. Besides, a commercial structure is prone to deterioration more than the residential.

 

But wouldn't you still have to pay taxes on the rental income you earn? But there are lots of tax deductions you can make which would cut down the tax you'd have to pay:

- you can deduct the cost of repairs from your taxable income [from the rental property].
- deduct the money you spend when you drive to your rental property.

And plenty more . . .

For a landlord who doesn't make much from their rental property I suppose they'll pay $0 in taxes.

 

I'm sure there are taxes to pay but rentals here are levied little taxes only particularly if the landlord is retired and has no other means of income. Some landlords I know are doctoring their taxes by not declaring the real amount of the rental. I just hope that my plan to build an apartment is the correct move because if it turns out bad, huh, I don't know how we would survive without a decent income.

 

I think you would be more likely to make a large profit with commercial property but the output is obviously going to be more in the beginning. I think you would have less turnover with commercial customers as well as a higher profit margin. I think looking for people who are expert in these matters could help you make a tidy profit on a commercial venture.

 

I would invest in a multi-unit apartment and live in one of the units. I would have a company manage the rentals so that the other residents would not know I was the owner to keep them from knocking on my door for problem solving.

 

I favor residential property because in my opinion commercial properties usually have not much room to grow since they are already developed and possibly already overpriced. There is something to be gained in the short term from investing in commercial properties but I think for the long term it is much better to invest in residential ones, though it's still a bit risky since you don't know which areas will develop into good locations in the far future but it is still a very worthy investment I think.

 

I'd opt for business rather than residential investment. Business investment property is expensive, but I feel business investment is more stable with less problems. We have an investment property in CA Valley that we are trying to sell for over 20 years. You see sometimes investments can be slow in returning your investment. The weather hasn't cooperated with our selling time too. We have hope to sell our land still, so research your investment thoroughly and make sure you can stand financially every turn your investment goes.

 

If you intend to start small, then rental homes would be a good investment. It really depends on your available capital or the amount of money you're willing to invest from the outset. Also, whichever venture you're most confident in, you must make your investment there. For instance, if you're more confident investing in residential homes, then I see no reason why you should go for commercial properties, which, by the way, requires more capital and risks. Rental homes are particularly easy to supervise and put up. If your family has a bunch of idle lands, you can just develop them and put up a series of apartments. Well, you can opt to be more creative about it. For instance, why not build a condominium with commercial spaces in designated floors? That's the trend these days - hybrid developments that combine residential and commercial property investments.