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Is it a dangerous time to invest in commercial property?

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  • 21-11-2011 6:34pm
    #1
    drunkmonkey
    Registered Users Posts: 28,199 ✭✭✭✭


    Just looking for some opinions from people in business, Currently renting a premises and a premises has come to the market that I think I can get a commercial mortgage on but i'm wondering what way the values in commercial premises is going to go (retail).
    Is the market low, overpriced? Are prices going to keep falling as jobs and taxes go up. Basically is it the wrong time to invest, should I just sit out and see what happens.

    A commercial mortgage will cost me less than what i'm currently paying in rent but i'll have the mortgage for 15yrs and have no idea how long the business will stay going but this new premises is in a prime location and I wouldn't be overly worried about finding a tenant to rent it to if I moved out.


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    #2
    antoinolachtnai
    Registered Users Posts: 9,800 ✭✭✭antoinolachtnai


    You need to fully understand the tax implications. You can expense rent, but you can't expense your capital repayments. Also, you need to consider capital gains issues if you sell this property later at a profit. Time for a visit to the accountant.

    I presume you have no problem in relation to your current lease. You will also have to have a pretty chunky deposit.

    A good deal is always a good deal. It really depends what price you can get it for. Remember, you are in a strong position here, because you are both buyer and tenant. You have something to do with the premises right away, unlike most prospective investors who have to worry about finding a tenant.


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    #3
    TheCostumeShop.ie: Ronan
    Company Representative Posts: 1,740 ✭✭✭TheCostumeShop.ie: Ronan


    Sounds like a good deal if you can reduce your companies rent. You might want to consider buying the property in your own name and renting it to the business if the business is not 100% stable and could engulf the asset if it failed. Also great tax benefits this way so that is how I personally would structure it.

    I do think the market is bottomed out but only if the seller isn't stuck in the past hoping for last years rates which many are.


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