Purchasing commercial property as an investment is a huge decision to make and there are a number of things any potential investor must look out for and be aware of.
It may seem like simple advice and in some cases common sense, but Dr Dennis Coote, founder of the Hampshire & Home Counties Property Networking Club, has fired a strong warning to potential commercial property developers’, regarding the dangers of investing in unfinished commercial property builds. Coote declared: ‘There have been some awful stories about developers taking deposits and large sums of cash and then going bankrupt. It’s happened a lot.’
Many investors are drawn to investing into unfinished commercial property projects, by the fact they can own property for a relatively low sum of money, with the potential of large returns on a small investment. Of course though, this doesn’t come without its own dangers.
Dr Dennis Coote, suggests potential investors should only exchange contracts on investment property once it has been finished in its entirety and a thorough inspection has been carried out.
Investing abroad is somewhere that the option for investing in unfinished projects is common. Investing in commercial property abroad has always been seen as a cheap option, although risks involved in this can sometimes be very high and there are so many horror stories to be found on this subject that a book could be written.
However, Dr Dennis Coote, believes there are opportunities for investing in property abroad, citing the Spanish property market as being vivacious. He said, ‘In Spain things are looking very bright…Prices are not going up very fast, but there’s a very lively atmosphere. I don’t see any evidence of people being hard up here, honestly. It’s very much a vibrant market.’
Although this may be seen in some quarters as very obvious advice, it must be taken into consideration, especially in the current economic environment. If you are going to invest into unfinished commercial property, make sure you thoroughly research the history of the construction company in charge of the build.
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