As a responsible and advantageous investor, there is no doubt that you are always looking for new ways to make your money work for you. If you are looking for an investment that can help you now by increasing your cash flow, and further down the line as it vastly improves your equity, you may want to think about purchasing an industrial property.
If you are curious about the advantages of industrial property, then you have come to the right place. After this quick breakdown, there is little doubt that you will be ready to look for an industrial property for sale. Learn more.
Property that is sure to appreciate
When it comes to nearly all types of property, there is very little doubt that your industrial property will appreciate over time. Of course, there are factors that are hard to predict, such as the way in which the perceived value of the location of your property exists, but one thing that remains consistent practically all over the map is that property improves in value. Even in the case of recessions or economic downturns, properties typically bounce back quickly and exceed their previous value.
Interest rates are still historically low, which means that if you have a great credit score (which you will almost certainly need in any event that you want to purchase an industrial property), then you will be able to enjoy incredibly low financing. This means that you can get a significant amount of funding for a fairly low price.
This will make it even easier for you to build considerable equity in your industrial property which will help you save for the future and create a significant nest egg for your eventual retirement. What is even better about purchasing industrial property is that if you want, you can continue to own and run your property with very little work. This means that you can continue to make money off of it even while you are retired.
Major cash flow opportunities
One of the most valuable things about owning an industrial or commercial property is that it can dramatically increase the actual cash flow that you get from your investments. One of the negative aspects of making other types of investments, such as in companies or in the stock market is that you can become fairly cash poor. This means that you do not have the freedom to make other purchases and investments you want to as quickly as possible. This can put you at a serious disadvantage in some aspects of life and can just be downright frustrating.
When it comes to owning an industrial property, you are going to get major influxes of cash every month in the form of rent checks that your tenants are paying. The fantastic thing about rent is that it can increase in accordance with the market value. So if you own property in a highly competitive market, your cash inflow will increase with each passing year.
The steps to purchasing an industrial property
Now that you know some of the top benefits of owning an investment property, it is probably a good idea to quickly break down the several steps that you can put in motion in order to actually own your first investment industrial property.
Whether you have already purchased some kind of property in the past (most likely residential) or not, this is a good way for you to familiarize yourself with the general steps involved in purchasing an industrial property.
Understand why you want to own
One of the first things that you should do is take stock of why you want to own an industrial property. There are no right or wrong answers here, really. If you are looking to improve your liquid cash inflow, great. If you want to build equity and eventually own many different properties, great! If you want to reap the tax benefits of being a property owner, also fantastic.
Just make sure that you know your primary motivations and goals so that it can inform you about which options of properties might be best for you.
Look at your options
The next step is to look at what kinds of properties are available to you. There are many different types of industrial properties that you can look at. The most common include:
- Apartment buildings
- Office buildings
- Retail buildings
- Mixed-use buildings
The next step is to secure the financing for the property that you want to purchase. Remember, just like when you are buying a home or car, it is wise to shop for the loan that works best for you rather than search for the property of your dreams without knowing if it is financially realistic for you or not.
Before you reach out to lenders and banks to see what options you have, make sure to do the leg work necessary to make sure that your finances and credit score are in the best shape possible. Pay down loans if you can to reduce your debt-to-income ratio, as this can dramatically improve the rates that are offered to you.
Get the right team and do the work
There are a number of experts that you can work with in order to make sure that you have the best chance of success throughout the process of finding and purchasing a property. You will want to find a commercial realtor, accountant, commercial real estate attorney, commercial lender or mortgage broker and tax attorney on your side as you find the right property in your market and do the homework necessary to make sure that it is a viable property for a great price.
Close the deal
Once you have found a great property for a great price that will allow you to achieve your goals, it’s now time to make an offer and close the deal. From there, you can get to work to get the industrial property to work for you in the right way.