Do you know that you can create wealth in commercial real estate while reducing the risks even in troubled economies? So what do you need in order to be successful investing in apartments, self-storage and other commercial real estate assets?
Commercial Real Estate is anything 5 units and up so if you are 4-plex and many people probably have bought a 4-plex or don’t have any fears about buying a 4-plex that is residential. Cash Flow Mortgages are where the lender will let you take a percentage of the income and make the payment. Commercial foreclosures give the business owners and the real estate investors a chance to find properties priced below market value. Now, take note that 68% of every gas station, hotel, retail mall, restaurant, every commercial kind of a building are going to need to have their debt refinanced and most of them are down under water and are going to be headed to foreclosure. This is quite an opportunity for you.
The way the value of an apartment complex is determined is partially based on the income of the property, the more income the property takes in the more it is going to be worth. The value of a commercial property is based on the income it produces and because you can to some extent control the income, you can control the value of your property regardless of the market. Don’t you have to have a lot of money, a lot of cash in the bank to get into commercial real estate? The answer is, not necessarily. There are solutions to that problem. Many commercial loans are assumable. Many will allow a seller carry back. There are cash flow mortgages that some lenders will do. Apart from that there are lease option, tax credits and there are FHA financing.
There are also a number of things you can do once you found an amazing opportunity to purchase performing apartments and other commercial properties. You can buy performing properties in foreclosure and flip them, keep them, option them, rehab them, or you can also rent them. The best thing is that you can make enough money just by doing one deal. You don’t have to go and buy million dollar properties or 200 units, just buy 20 units, 1 building. Depending on what you buy, is how to identify which market to buy. Remember that whether it’s a residential or commercial deal, you can start small. Just do a deal.