Be it a luxury villa plots in Bangalore or villas, investment in residential property always gives peace of mind. On the other hand the commercial real estate investment looks pretty promising, but when you get into the market, you realise the pain associated with such purchase.
IT REQUIRES MORE TIME & COMMITMENTS
A residential property doesn’t bring you a lot of responsibilities. When you buy one, all you need to be sure about is keeping it protected and paying the monthly EMIs on time. But if you are buying a commercial property, there’s a lot to manage there.
You can’t simply remain absent and expect returns on the property. This luxury is limited to residential properties only. No matter how good tenants you get, you will need to deal with multiple things such as public safety, maintenance cost, maintenance issues and lease. In short, you need to maintain a positive environment for your tenants as well because everything they draw to your place will directly and indirectly affect your property.
INFRASTRUCTURE CHANGES DO MORE HARM THAN GOOD
No office space is perfect. You may be having several issues in your office space as well. The tenants you’ll find won’t likely need to set-up their entire business in the way the property is designed. One size doesn’t fit all, so there will be changes in infrastructure. Minor or major, such changes do more harm than good to your property in terms of construction and market value.
FINDING TENANTS IS HARDER THAN YOU EXPECT IT TO BE
While for commercial properties, you will find tenants needing long-term leases of a couple of years, it becomes hard to find the right ones. You may have seen that commercial properties tend to be vacant for long time, and when it happens, you need to cover the cost during this period as well. When you buy a residential property, you don’t need such tenants because residential properties on rent get occupied easily.
VALUATION IS COMPLEX
When you buy a residential property in Bangalore or anywhere around the world, there are some common factors that help you find the actual value of the property. But commercial properties are bit complex when it comes to finding their right value. In market, there are many commercial properties for which valuation is being done on strange and weird factors. Location, exposure and visibility are common factors, but there are people who do not get the actual value for their commercial properties and a huge gap can be found between two commercial properties at the same location. Residential properties are very promising when it comes to valuation.
A RISKY INVESTMENT
Buying residential properties in Bangalore won’t put you in a risky environment. We all know that every single investment is risky, but what matters the most is the level of risk you are taking. The future of your investment in commercial real estate highly depends on the businesses it houses and the market conditions. When you are accommodating a business in your commercial space, you accommodate risk.
There are many good opportunities to buy residential properties in Bangalore. All you need to do is to make sure that you find the right property and stick to your investment plan, instead of jumping into commercial real estate.