Investing in commercial property is a noble endeavor. However, there are certain challenges that you will face if you are looking into purchasing property in Australia. Australia is a continent-sized country with incredible natural resources and development projects underway. It’s also one of the world’s wealthiest countries, with a flourishing economy and wise investment incentives for those wishing to purchase commercial real estate. But before you start purchasing property in Australia, you must be aware of the many challenges that lie ahead.
1. Legal Restrictions
It’s not easy for someone to purchase a commercial property in Australia. You will have to be very careful about all the legalities of the situation, ensure that you have all the proper paperwork, and ensure that the seller has done everything by the book. It is essential that you do all of this adequate research into the commercial property you are planning to buy.
Shape negotiations such as zoning, lease terms, and easements can be challenging and often require a lot of time and effort to work out. In Australia, there are a lot of regulations regarding the purchase of real estate property. You need to be aware that these laws may not always favor you. Be sure you know your rights before purchasing any properties in Australia for investment purposes.
2. Location and Space
Location is crucial for any investment property, and commercial properties are no different. You need to check around and see what can be an ideal area where your financial goals can be achieved easily. You need to know the market in which you want to operate as well as its regulations so that you get a property that meets all of your requirements and makes it easy to run a business.
In Australia, commercial properties are not uncommon at all. However, you will find easy access to commercial properties in metropolitan areas and the outskirts of major cities that allow for easy access and great visibility. On the other hand, purchasing a property in remote areas far from developed areas is very difficult. Finding investment opportunities with less than favorable water access or foundations takes a lot of work.
3. Property Prices
Australia’s property prices are prohibitive compared to the rest of the world. However, there are still great deals for those purchasing commercial property that do their research and invest wisely. It’s essential to know that you will get a different kind of return on investment than you would if you purchased a residential property. However, commercial property is still a great area to put your money.
It is vital that you find a region where property prices are growing and one with opportunities for future development.
4. Adapting To the ‘New Normal’ for Office Space
With the current Global financial crisis and associated stock market crash, several companies have been forced to reduce their operating expenses. While they have done this through a reduction in workforce and headcount, they have also looked at reducing their office space.
Several companies that were previously leasing huge office spaces are now moving into far more functional space, often in refurbished warehouses or other industrial buildings. More so, most financial investors in Australia prefer offices for rent in Brisbane to be close to a train station and CBD so that they can commute easily. You need to seriously consider these changes, as the way office space is being used today makes it much less expensive to buy commercial real estate.
Property financing is not easy, especially during the boom of commercial property in Australia. You will find that banks will be quite selective in who they give loans to, and you need to pay a lot of attention to whether your application will be accepted. If you have been slacking on office space rental in Brisbane for rent, your chances of buying a commercial property are slim. You should have a down payment ready before you even begin to consider buying commercial property.
When you are buying commercial property in Australia, it is important that you are aware of the challenges that you may face. These five challenges are the most common, but there may be others in place. Be sure to learn about any potential problems and work around them so that your investment is a success.