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Steps to Take Before Buying Commercial Real Estate

 Posted on December 00,0000 in Commercial Real Estate

Naperville real estate investment lawyersStepping into real estate investment and development industry can be a smart choice. It can It is also an extremely risky industry, full of esoteric laws and complexities. There are regulatory hurdles and fewer lenders than there used to be. Thankfully, there are some ways to mitigate against these risks. The following explains how.

Look at Long-Term and Short-Term Issues

Although real estate investment can (and often does) offer a long-term payout and tax deductions for things like utilities, insurance, and other related expenses, there are also some short-term financial drawbacks that you must consider. For example, it is important to understand that you will have less liquidity once your money is invested in real estate. There are also costs associated with investing, like inspection fees, purchasing taxes, and more.

Further, the market can dictate just how much you earn in any given month or year. Rent prices may go up, but they can also fall. Recessions can result in job losses, and that can cause you to lose tenants. Most investors also understand subsequent investments are the key to making it big – so you will need a plan, not just for this purchase, but also the next one, and all the subsequent ones after that. It needs to be one you can realistically implement, even during a down period.

Shop for the Right Property and the Right Lender

Jumping into an investment property or signing with a lender too quickly can result in serious consequences, including a substantial loss of funds. For example, you might take lending terms that are less than optimal, or you might purchase a property that is a prime location but too costly. Alternatively, you might buy a property that has an enticing price but is unlikely to be rented or resold.

So, how do you avoid making such mistakes? You start by shopping around for the right property and right lender; weigh the pros and cons, take the time to understand your market, and get more than one opinion. Then you practice due diligence before closing out the contract. Lastly, do not pursue a real estate deal on your own; instead, contact an experienced real estate investment lawyer for assistance.

Contact Our Naperville Real Estate Attorneys

At Lindell & Tessitore, P.C., we work to ease the real estate investment process. Skilled and experienced, we can provide you with the knowledge and confidence you need to make sound decisions for your portfolio. Learn more about how our Naperville real estate lawyers can assist you. Call 630-778-3818 and schedule your personalized consultation today.

Source:

https://www.unionbank.com/Images/8912239_Article10_vF.PDF

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