If you’re currently renting your factory or commercial premises, recent property market indicators suggest that now is an ideal time to consider purchasing your own.
Interest rates are at their lowest levels in almost 50 years making repayments easier, while there are some real bargains around for well located industrial units, factories and commercial premises, says financial advisor, Finlease.
According to Colliers International research analyst, Mathew Tiller, “Yields on industrial property have increased and interest rates have fallen. This means that the spread between the cost of purchasing a property and the return on investment has increased.”
In the Sydney Industrial Market Indicators Report Summer 2009 published by Colliers International, Sydney industrial property recorded a return of 11.1 per cent for the year to June 2008. So if you’re paying rent, your landlord is making good profits at your expense, says Finlease.
Rents in certain sectors grew with areas like South Sydney, for instance, recording rental growth of 4 per cent, meaning landlords are still profiting despite the financial uncertainty we are experiencing.
Finlease property investment specialist, Jackie Mitchell, said: “Right now there are opportunities to be found in industrial property and commercial premises, yet at the same time credit markets have tightened up considerably. This means you may need some resources on your side to present a compelling case to financiers in order to secure the funds.”
Once you own your factory, workshop or industrial unit, you’re more in control of your business destiny and won’t be at the mercy of your landlord, Finlease says.
The money you’re currently spending in rent could be paying off an appreciating asset and building a nice secure nest egg for you when you eventually retire, the company says.