Questions to Ask, When Buying a Commercial Real Estate Property

Upon seeing a sign of “For Sale” on a commercial property, the first thought that comes to the mind of potential buyers is that it may be the property of their dreams. They stop to examine the property and to have an idea that whether it is the one they are looking for or not. They sign a check for it in the case they like it; otherwise, they go ahead in the search for another property.

Commercial-Real-Estate-Deals

If you are thinking that the process is so simple, then you are wrong. It is not all that is done before buying a commercial real estate property. There are a number of facts that you need to consider for making sure that you are going to take a wise decision by investing in that property. And for that, you need to take the help of a commercial real estate agent. So, if you are having a real estate property in your buying list, then here are the few questions that you should ask before purchasing it.

  • Is the location good? 

Location is the first thing that you need to consider before buying any real estate property. And the rules for buying a commercial real estate are slightly different. A location that looks best to the house buyers may not be fit for the commercial investment. So, you need to consider and ask that whether the property location is good for attracting high occupancy or not.

In addition to location, you should also consider that whether the property is having any access or visibility along traffic corridors. Employment and the strength of the local economy should also be considered.

  • Ask about the property zoning code

Get it verified by your real estate agent that whether the zoning code of the property allows you to use it or not. Though you can get seek re-zoning, but all properties do not become eligible for that.

  • Is there any tenant?

If there is a tenant, then review the rent rolls, credit files, payment histories for current tenants and determine the associated risk. Also, have a look at current leases to know the tenant and landlord obligations.

  • Is there any big issue with the property?

The property may be demanding expensive repairs, may have some obligations or there may be some legal liabilities for new owner. So, like house buyers, do your due diligence to find if there is anything like this. You can take the help of your commercial real estate agent to get the answer of all these questions.

>>Also read these 10 Steps for a Hot Commercial Real Estate Deal <<

  • Are there any operating expenses related to the property?

Before making an investment, check all the financial documents to ensure accuracy in the accounting and income projections. As these records leave an important impact on the value of the property, the seller would be required to keep them available upon request.

Once you have ensured all these facts, you can expect a seamless transition of your ownership.

What is the Difference Between a house buyer agent, a broker and a realtor?

A common mistake that most of the people do while talking about the real estate industry is using the terms- real estate agent, realtor and broker, interchangeably. No doubt that all of them work in the same industry, but there is a difference between the services that each of them provides. Don’t think that “any” real estate professional will be able to solve your real estate issues. Instead, try to know the difference between these three titles related to real estate market and then, find that who will suit for your particular needs. Through this article, we are going to tell you the main difference among the real estate broker, agent and realtor.

  • Real estate agent

real estate agent

Also known as real estate associate, a real estate agent is a professional who has passed all the required exams along with the state level real estate licensing exam. He is required to pass the state level exam for the state he wishes to work in. Being an agent is the starting point for real estate professionals. There are some restrictions for real estate agents for what they can do and what not. For an instance, a real estate agent cannot start his own firm or work independently; he must be working under a broker.

  • Real estate broker

Real estate broker

A broker comes on the higher level as compared to that of an agent in the real estate professionals’ hierarchy. He has completed the advanced education and has gone through additional training, which let him get the detailed knowledge of the real estate law. When it comes to responsibilities, then brokers are given more responsibilities and power than the agents because of their enhanced capabilities. Though brokers are allowed to start their own brokerage firm, but it is not compulsory. A broker can also choose to work for a real estate company as it will help him to enhance his expertise and skills. As broker has more knowledge about the industry trends, you can consider hiring him to buy or sell my house fast.

  • Realtor

Realtor

A realtor is also a real estate agent but he needs to get the membership of National Association of Realtors (NAR) or Canadian Real Estate Association (CREA). He needs to maintain the standard and subscribe to the code of ethics for becoming a member of NAR or CREA. Every realtor is a agent, but every agent is not a realtor.

As all of them have different duties to perform, so, house buyers and house sellers should be well aware that who they are dealing with while buying/selling a house. However, it will be more beneficial to hire a real estate company for buying or selling your house or any other property. As team work is preferred in the companies, you will get the guidance from the agents, brokers as well as realtors. And in the case you are hiring an individual real estate professional, then make sure that he is licensed to provide the services you are looking for.