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Commercial property investing as an alternative to residential

Commercial property investing as an alternative to residential National Propertyscouts


The pluses and minuses

It was reported recently that commercial property returns are at an all-time high of (circa) 15.9% - the highest return since 2007. So, is now a good time to be jumping from residential investment into commercial? If you are interested in the thoughts of a ‘lay person’ who has been involved in both, keep on reading. Commercial has its benefits. Generally, once you have a good tenant in place it’s a lot more ‘hands off’ than residential. Commercial tenants generally take care of most of the ‘outgoings costs’ incurred by the landlord and the biggie at the moment – commercial isn’t incumbered by the Residential Tenancies Act (RTA) and commercial landlords don’t seem to attract the ire of the present Government in the way residential landlords do. They are some of the bonuses of commercial ownership, but it’s not all roses. Generally, a commercial property will cost you a lot more than a residential property, so depending on the size of your wallet you may end up with all of your eggs in the one basket. Commercial tenants can be a lot harder to find than a residential tenant so downtime between tenancies can be long and generally banks will only offer a loan term equal to the lease in place. If you are thinking of commercial investment, then a way of dipping your toe in the water might be the likes of a share in a commercial property. Mackersy Property is a well-respected company which puts commercial investments together for shareholders - https://www.mackersyproperty.co.nz

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