Steps to Take If You Want to Own A CRE Property
If you are ready to consider investing in commercial real estate in Oklahoma, you will want to take the necessary steps to become familiar with the commercial real estate business. The CRE market has greater risks but also greater rewards when you understand everything you need.
Buying Commercial Property Tips
Buying commercial property is not like purchasing residential real estate.
Do Your Homework
Take the time to learn the vocabulary and terminology of the commercial real estate business.
Here are some of the basics:
Capitalization Rate (Cap Rate) – Property income / property value
Loan-To-Value (LTV) – Borrowed amount / appraised property value
Ad Valorem – Tax based on the assessed value.
Vacancy Rate – The percentage of vacant properties vacant in a specific time period. Of course, this list is not at all complete, but it is a good starting point.
Consider Your Situation
Determining what you want from your property is one of the most important buying commercial property tips:
Type of property – Office, industrial, retail, etc.
Location – City center, suburb, etc.
Down payment and financing options
Self-management and representation choices
Once you know what you are ready to do, you can choose your property.
Visit and Research
Begin visiting potential properties that meet your criteria. Of course, cost, condition, and location are factors, but you will also need to pay attention to zoning and use. There is no point purchasing a property if you cannot use it the way you want.
Additionally, pay attention to the property values, possible rent, and any changes in the area. If you are purchasing a property in an area that has the potential to grow and develop, you can increase your revenue. Of course, this requires an understanding of the market.
Even with careful research, accept the help of a commercial real estate expert who knows how to buy commercial properties. A full-service brokerage firm will have the knowledge necessary to guide you through the process. Should you have any questions about how to invest in commercial real estate in Oklahoma, please contact us. Our team is here to help you discover your ideal property.