If you are considering delving into the world of real estate investment, you’re not limited to the world of residential real estate. B Before deciding, it’s a good idea to learn the differences between investing in commercial and residential real estate.
- Valuations are Different b Commercial real estate is quite easily valued on its earnings power. Residential real estate must take into account a whole host of subjective criteria as well sych as location and amenities.
- Cash Flows are Usually Better b Commercial properties are always purchased as an investment. As such, cash flow is a significant consideration, unlike in residential properties where other factors predominate.
- Commercial Offers More Diversification b Most residential properties are single-family b if you lose that tenant you have a significant problem. Commercial properties B do not suffer from that disadvantage.
For more information on this and other South Florida commercial real estate topics, please contact us at the Morris Southeast Group.
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