Leasing or Buying? What is better for you?

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Investing in properties would certainly need financial planning as it accounts for a major share of your capital. One may either choose to buy an office space or get it on lease. Leasing an office area could be beneficial in many ways. Leasing offers you low initial commitment, flexible decision making, and there is also an ease of maintenance. Leasing a property can yield great benefits. Following are the reason why one should look forward to renting an office space.

 

  • Low Initial Cost

 

If you lease a property, there are very low initial commitments without down payment. You just need to deal with the deposit and that’s all. After paying the deposit, you are left with a nominal amount which includes rent and other nominal charges like maintenance, electricity, water, etc. periodically. There is no load of paying a heavy sum at a time and that way your finances are parked and there are no disruptions or you have to do cost-cutting in other plans. The impact of leasing an office is much less on your pockets than buying them. So, for setting up businesses it is always recommended to start with leasing a property.

 

  • Less Responsibility

 

There are a lot of costs involved in repairs and maintenance. If you buy a shop then you need to take care of its maintenance and repairs, but if you lease it, it becomes the landlord’s responsibility to take care of all such stuff. So this is also an additional advantage wherein you are free from investing any extra time or penny for such things. And in some cases owners would remodel the property to suit your requirements. So in such situations it is good that you can get the property customized without paying anything in extra.

 

  • The Choice of Locations

 

When you are willing to buy a property your major concern would be the area in which it is located. Now a property’s cost also depends on the area in which it is located. The area and its accessibility to people, markets and the developments in that region, etc., all stand to be the reasons for the price hike of a property which you intend to buy. Now, if you lease a showroom or shop you have this option of renting it anywhere in the city so that you can have better customers and you have a profitable business. There is no one-time money flushing out of your pocket, rents would be comparatively higher but there would be a periodical flow of money. So leasing shops and showrooms in good areas is much feasible than buying the property itself.

 

  • Leaving the Property is Easy

 

After you have outgrown in the space and you feel that there is a possibility to a better market, it would be very easy doing that. Had you have bought the property, you would have been forced to stay in the same location because nobody would like to struggle to look for a good tenant with required rent for their property and shift themselves to some other area and pay the rent there when the EMIs and bills are buzzing around every month. On the other hand, if you have taken the shop on rent, you may shift anywhere easily and can start things afresh in the new market.

 

 

Referring to all these points it is evident that buying a shop or showroom may not be a good idea over leasing it, especially if you are in the early stages of your business. There is a one-time investment of a huge sum of money which is heavy on your financial planning and would form the major part of your capital investments. Buying a property would put various restrictions on you, the location, the other investments.

 

So it is highly recommended that you start a business in a rented showroom and then may be later when you find the area convenient enough you may plan to buy it. It would be easy to lease a property anytime than buying it and would help you save money and time for yourself.

 

At Brickfolio, we understand the tremendous promise of commercial real estate. We consistently strive to make real estate transactions profitable for our clients.

To know more about us and our offerings, reach out to us today!

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