Real Estate investment continues to be a time sensitive topic. Commercial real estate, specifically barely survived amidst the pandemic. Commercial property is any property constructed to make money. This past year, businesses were forced to close or are currently hanging on by a thread. However hotels, offices and retail stores are said to be on the come up!
The COVID19 vaccine has just begun being distributed and is ultimately the key to the resurrection of commercial real estate.
According to Sarah Paynter reporting for YahooFiance, “‘As monumental as 2020 has been, 2021 could be even more influential, as the critical decisions and investment leaders make now could bear fruit over the next 12 months,”
Investors are predicting that even more businesses will continue to close and go bankrupt before the market starts looking better. But knowing the way the market works is KEY. So let’s talk about why commercial real estate specifically is something every investor should consider looking into…
Commercial real estate truly pertains to the saying, “the higher the risk, the higher the reward.” CRE works with higher prices than any other form of real estate. This means that the investor’s potential return is also higher. In addition to the potential return, commercial real estate also means saving money on your property taxes. When it comes to moving on from one venture and onto another, 1031 exchange provides aid to owners financially by allowing them to avoid capital gains taxes. This method is probably not the easiest because you would need to transfer the profit to another asset or area of interest.
A lot of people get stuck solely on residential real estate investments. But especially today, CRE is what investors should be focusing on. The competition is so much higher in residential real estate right now!
“The dollar volume for commercial real estate in the U.S. was 57% lower year over year in the third quarter of 2020. So it should be easier to find a commercial property right now — especially compared to other assets on the market,” reports Aly J. Yale with Million Acres.
To add to all the benefits, when working in the world of commercial real estate, you have a lot more help with upkeep. A lot of investors chose to work with the ‘triple net leases.’ This style of leasing allows investors and owners to take a step back and have the tenants deal with certain expenses themselves.
© 2020 Ben Soifer. All rights reserved