Is it worth buying commercial property?

When it comes to commercial properties, the question of whether it is better to buy or rent can be a complicated one. There are benefits and drawbacks to both options, and ultimately the decision will depend on your specific circumstances and needs.

Firstly, let's consider the benefits of buying a commercial property. One major advantage is that it can be a good long-term investment. Property prices tend to increase over time, so if you buy a property now, it could appreciate in value over the years, potentially providing a significant return on investment. Additionally, owning a property means you have greater control over its use and can make changes and improvements without needing to get permission from a landlord. You can also benefit from potential tax advantages, such as deducting mortgage interest and depreciation from your taxable income. ‘After a 10 year mortgage you have an asset, after a 10 year lease you have a dilapidations liability’.

On the other hand, renting a commercial property also has its advantages. For one, it can be a more flexible option. Leases typically last for a few years, and when the lease is up, you have the option to renew or move to a different location if your needs change. Renting can also be a good option if you don't have a lot of capital to invest upfront. You'll likely need to pay a security deposit and a few months' rent in advance, but you won't need to worry about coming up with a large down payment or taking on a mortgage.

Ultimately, whether it's better to buy or rent a commercial property will depend on your specific circumstances. If you're looking for a long-term investment and have the capital to invest upfront, buying may be the way to go. If you're just starting out and don't have a lot of capital, renting can be a more affordable option that allows you to focus on growing your business.