Real estate has developed into one of the most profitable business. Real estate consists of buying, selling, renting and developing land for residential or commercial purposes. Investing in commercial property comprises of wide range of activities which includes buying, renovating and selling the property so that its selling price is higher than when the properties were bought.
Buying and selling commercial property in Arlington Virginia can bring huge financial profits and rewards if done appropriately. A person can buy a commercial property, add more value to existing property by improving its exterior and interior looks and then sell the house for a profitable amount. For a person interested in buying and selling a commercial property he/she must know some of the real estate terms such as
- Loan to value (Ltv) ratio: This ratio tells the amount of money asked from the lender against the total price you are willing to purchase the property
- Capitalization Rate: The total income of the commercial property divided by the total price of the property
- Vacancy rate: The percentage of properties that are available or vacant of a given area in a period.
The most important question before buying or selling a property is whether the business transaction will be viable and bring financial profits or not. The numerous steps in while buying a commercial property are
- Selecting the best property based on the location and its market value
- Making right assessments about what sort commercial use will be best suited
- Making a detailed report about the property, its advantages, and disadvantages
- Obtaining the property that will result in monetary profit
There are two things a person can do when he has acquired a commercial property, first; sell the newly obtained property to be used as office or retail store and second; keep the property as an investment and rent out the property space for commercial aspects.
For buying and selling commercial property in Arlington Virginia, a person must contact and employ the services of real estate professional and a qualified lawyer. A person must know all the financing options available to him/her if they want to purchase a commercial property. A person will be required to present his financial history to show that he/she will be able to repay the loan amount and do not default on the loan. One major factor that is part of every loan is the percentage of interest rate applicable to the loan amount. A person with good financial history has more chance of getting a mortgage with low-interest rate whereas a bad credit score or debt ratio will force the borrower to pay increased interest rates. Before agreeing to the buying or selling agreement, it is advised to thoroughly review the document to know about the details and obligations you have. A lawyer will also be present who can deem the agreement legal and correct. When you are selling the commercial property, make sure you have all the relevant documents and receipts of the house.