Benefits of Investing in Commercial Property Lending Services
If you are someone interested or looking to grow your financial status either while at an early age or perhaps already in your later years, you should know that investing in commercial property lending services can give you the benefits you never knew you could reap. Truth be told, unless you knew these benefits, you probably wouldn’t even consider investing or loaning for your investment. It’s best that the facts will be laid out in front of you in order for you to realize the potential of improving your wealth through commercial property investment. Here are some of the best benefits of investing in commercial property lending services that you can experience and the appropriate loans that you can apply for:
1. Return on Investment is higher.
With the right investment property, a greater return on investment can be achieved in investing in commercial real estate as opposed to residential ones. With a 6-12% average ROI in general, commercial properties definitely surpass that of the 1-4% ROI of residential properties. With that in mind, money will not be an issue especially when you engage in property lending services. There’s always a multi-family apartment loan to help you get started. There are services that offer competitive rates on such loans.
2. Asset Value appreciates overtime.
Getting a loan in order to pursue investing in a commercial property will have you reap the benefits of the appreciation of its asset value. And take note, its appreciation goes beyond other investment types. Such properties increase in value enables a cost-effective development which in turn enhances the usability and desirability of the asset, not to mention the imbalances of supply and demand. One can always call on a commercial real estate loan provider in order to achieve that. Due to real estate’s flexibility, you can invest either in multiple places but doing so in one place is definitely cost-saving.
3. Tax Benefits are commendable.
It is best to understand the tax benefits of investing in commercial real estate in order to fully enjoy the greater portion of your income flow. A few and most common of these tax benefits include mortgage interest and depreciation deduction, and the 1031 exchange. Deductions in mortgage interest will be coming from your taxable income. Despite the fact that depreciation sounds more of a negative thing than positive, it will do you well to know that it doesn’t mean having a loss in value but more like a “non-cash” expense. The last tax benefit, which is the 1031 exchange, may perhaps be the biggest and most significant benefit in investing in real estate. When you complete an exchange, the depreciation recapture taxes and capital gains taxes that are due will be deferred. There are few more other tax benefits and it would be wise to consult a tax advisor regarding these. Again, there are many different and efficient types of loan to invest with just the right amount to begin your venture.
4. Long leasing period.
It is a fact widely known that investing in real estate means looking far into the future of reaping harvests. However, one of the benefits of it is that commercial properties have a long leasing period that can even extend to at least 10 more years
So many people have been investing in commercial real estate due to these appealing benefits that they come in package with. All you need to have is the right capital. Even when it comes to investing in residential properties, there’s what we call a residential refinance loan which allows lowering the monthly mortgage payment and increasing the rental income. But then again, investing in commercial properties has been the buzz for the last decade or so. Whatever investment it maybe – be it residential or commercial – there’s always a perfect opportunity to improve your wealth and help you achieve the benefits mentioned.