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Will You Add? - Should You Invest in Residential or Commercial Properties?
As the population ages, with baby boomers reaching old age at the rate of 11,000 each day, the need to save money and get discount long term health care in Nevada has never been greater.According to government figures, just over half of all Nevada residents who lived past the age of 65 will need some form of long term health care at some point in their life. Depending on how long such care is needed, and how extensive the required care is, the cost for such care can be devastating for the average person.Many Nevadans erroneously believe that all of their long term health care needs will be taken care of by the state or federal government once they reach the magical age of 65. This is not really true.The federal Medicare program has almost no provision for long term health care support, and while Nevada’s state-run Medicaid program does have a provision for limited long
3. Better Tenants: tenants for commercial properties are financially stronger. They may be Walmart or Home Depot with billions of dollars in the bank. They are less likely to nickel and dime with you. In addition, they also guarantee the lease with their assets. If for some unforeseen reasons they have to vacate the property, they continue to pay the rent or find another tenant to sublease it. They are also motivated keep your property in good condition to attract their customers to their stores. While majority of residential tenants are goo
In a previous life I was a Navy Pilot. Great life, great people to be around. People who were all doing great things around the world flying off great big aircraft carriers. In an environment that complex and dangerous, you need to have teams of people working as one, or bad things begin to happen in large quantities.The people onboard aircraft carriers are divided into two groups, those that make the ship float and those that make the planes fly. Those that make the ship float are known as "ship's company", and those that make the planes fly are with "the airwing". During one tour of duty, I was assigned to the "airwing staff". The airwing staff coordinated the activities of the ten aircraft squadrons deployed aboard the aircraft carrier. It was while working for our Airwing Commander, Captain Jerry Norris, that I would unknowingly learn what has to become my most valued rule as an en
As the interest rates have gone up gradually in the last 12-24 months while the rents in the Bay Area remain very much flat, the negative cash flow gap is widening. The risk for investing in residential properties is increasing. The same old formula of investing may not work anymore. In the best case, investors may still make money but not as much in term of percentage since the value of real estate is pretty high already. In the worst case, investors may lose money as residential real estate may remain flat or even decline in value. Is there a solution for real estate investors in Northern CA? Of course, these investors can use the same old formula in a new area that has potential for appreciation. So the key is to find this new area. They just have to talk to someone who knows this new area. It could be Bakersfield or Sacramento or Fresno. Alternatively, investors can put money in commercial properties: retail strips, shopping centers, medical office buildings. Let’s just explore this paradigm shift to see if it makes investment sense.
1. Income: commercial properties generate 50 to 200% more rental income compared to residential properties in the Bay Area. In addition, there is no rent control for commercial properties. So landlords can charge your tenants as much as the market permits.
2. Leases: in general commercial real estate leases are more favorable to landlord compared to residential leases. Besides the base rent, tenants also have to pay landlord for property taxes, insurance and all maintenance expenses. These leases are called Triple Net or NNN leases. Because of this type of lease, commercial properties are better maintained than residential properties. Besides, the NNN leases also take away a lot of risks from the landlord as maintenance costs are unpredictable. On the other hand, landlords tend to defer maintenance on residential properties to reduce the cost. Consequently, the deferred maintenance will have negative impact on the value of the properties.
3. Better Tenants: tenants for commercial properties are financially stronger. They may be Walmart or Home Depot with billions of dollars in the bank. They are less likely to nickel and dime with you. In addition, they also guarantee the lease with their assets. If for some unforeseen reasons they have to vacate the property, they continue to pay the rent or find another tenant to sublease it. They are also motivated keep your property in good condition to attract their customers to their stores. While majority of residential tenants are good
Selling your products online is the best way to earn more these days. If you hit it as jackpot, you would just be sitting in the comfort of your own home while you just watch your money grow every minute. But just as other business, there are costs that you must first consider when you decided to do business online.Here are the basic costs to build your online business.1. Cost to host the web or the cost for shopping cart software. Actually there are free services that you can choose from but there are also some that cost more. You can spend from about $70 per month or even more. But of course, there are important things that you need to consider like:• For the software for your shopping cart, check on how many credit card processors are involved and the shipping services, if there is any. Choose that would give you ease of use as well as ease of updating information. •
1. Income: commercial properties generate 50 to 200% more rental income compared to residential properties in the Bay Area. In addition, there is no rent control for commercial properties. So landlords can charge your tenants as much as the market permits.
2. Leases: in general commercial real estate leases are more favorable to landlord compared to residential leases. Besides the base rent, tenants also have to pay landlord for property taxes, insurance and all maintenance expenses. These leases are called Triple Net or NNN leases. Because of this type of lease, commercial properties are better maintained than residential properties. Besides, the NNN leases also take away a lot of risks from the landlord as maintenance costs are unpredictable. On the other hand, landlords tend to defer maintenance on residential properties to reduce the cost. Consequently, the deferred maintenance will have negative impact on the value of the properties.
3. Better Tenants: tenants for commercial properties are financially stronger. They may be Walmart or Home Depot with billions of dollars in the bank. They are less likely to nickel and dime with you. In addition, they also guarantee the lease with their assets. If for some unforeseen reasons they have to vacate the property, they continue to pay the rent or find another tenant to sublease it. They are also motivated keep your property in good condition to attract their customers to their stores. While majority of residential tenants are goo
Daniel Woolsey is being sentenced for felony in California. He was caught selling pirated copies of Autodesk's AutoCAD(R) software. Additional counts for selling other pirated software, including Adobe PhotoShop, were dropped as part of a plea bargain agreement. "This case should be a wake up call to copyright violators that they can face serious consequences. Autodesk will continue to work closely with law enforcement agencies . . . to protect our valuable intellectual property . . . ." said Sandy Boulton, director of Piracy Prevention at Autodesk.Why should photographers care about this? Because we don't want our intellectual property - copyrights/trademarks/trade secrets - stolen from us. When we share that music file with a friend or copy Photoshop from a colleague, we are perpetuating the problem, even if it is on a small scale. Is it ok to steal a pack of gum but not a car?
1. Income: commercial properties generate 50 to 200% more rental income compared to residential properties in the Bay Area. In addition, there is no rent control for commercial properties. So landlords can charge your tenants as much as the market permits.
2. Leases: in general commercial real estate leases are more favorable to landlord compared to residential leases. Besides the base rent, tenants also have to pay landlord for property taxes, insurance and all maintenance expenses. These leases are called Triple Net or NNN leases. Because of this type of lease, commercial properties are better maintained than residential properties. Besides, the NNN leases also take away a lot of risks from the landlord as maintenance costs are unpredictable. On the other hand, landlords tend to defer maintenance on residential properties to reduce the cost. Consequently, the deferred maintenance will have negative impact on the value of the properties.
3. Better Tenants: tenants for commercial properties are financially stronger. They may be Walmart or Home Depot with billions of dollars in the bank. They are less likely to nickel and dime with you. In addition, they also guarantee the lease with their assets. If for some unforeseen reasons they have to vacate the property, they continue to pay the rent or find another tenant to sublease it. They are also motivated keep your property in good condition to attract their customers to their stores. While majority of residential tenants are goo
Recent changes to the tax laws and the required minimum distribution rules have made reviewing beneficiary designations for Individual Retirement Arrangements (IRAs) and qualified retirement plans (e.g. 401(k)) a high priority on the list of retirement and estate planning activities. This is especially true today, when more of individuals than ever have recognized the tremendous life and death tax advantages these retirement savings vehicles offer and have begun to amass considerable wealth within them. Yet many individuals who so conscientiously set aside money for to fund their retirement are very often unthinking and hasty when making and reviewing elections for the ultimate distribution of these accounts. The effect poor elections or the failure to make elections has on future distributions is significant.Perhaps the most important election anyone can make is the designation of
3. Better Tenants: tenants for commercial properties are financially stronger. They may be Walmart or Home Depot with billions of dollars in the bank. They are less likely to nickel and dime with you. In addition, they also guarantee the lease with their assets. If for some unforeseen reasons they have to vacate the property, they continue to pay the rent or find another tenant to sublease it. They are also motivated keep your property in good condition to attract their customers to their stores. While majority of residential tenants are goo
Businesses have begun to realize the importance and the benefits of employee training and development. When employees are trained properly and assessed periodically, a business definitely improves. Training makes the employees up to date on the latest techniques used as well as helps the business achieve customer satisfaction and retention. They are better equipped to deal with problems and reduce outsourcing or calling specialists to deal with certain problems. Proper training is necessary for the growth of the employees as well as the business, hence a needs analysis will be helpful in determining what kind of training best suits your employees as well as in Getting the Most out of Employee Training.Some companies give a lot of importance to the training as well as determining what the result of the training should be such as increase in profits, better performance of employees, redu
3. Better Tenants: tenants for commercial properties are financially stronger. They may be Walmart or Home Depot with billions of dollars in the bank. They are less likely to nickel and dime with you. In addition, they also guarantee the lease with their assets. If for some unforeseen reasons they have to vacate the property, they continue to pay the rent or find another tenant to sublease it. They are also motivated keep your property in good condition to attract their customers to their stores. While majority of residential tenants are good, some think once they pay the rent they have a license to trash your properties and then disappear in thin air with no forwarding address!
4. Long term lease: commercial tenants are less likely to move. They often sign 5-10 year leases. Tenants like Walgreens, and Walmart sometimes sign 20-50 year leases. In contrast, residential leases are short term. They could move out to a new place a mile away to get a $25 rent relief! It’s a fact that the turn over rate for residential tenants is very high compared to commercial tenants. As a landlord, this gives you more unneeded migraine headaches and stress.
5. Management: It’s much easier to manage a 10-tenant shopping center than 10 individual homes in 10 different places. As a matter of fact, if you own 10 residential rentals your tenants most likely have worn you down and we are exhausted. They often move out in the summer just around the time you want to take off for vacation. Yes, it’s a fact that residential properties are very management intensive because of high turn over rate. If you have to hire a property manager, it also costs more in terms of percentage of the rent to manage residential properties. Besides, it probably is a full time job just to manage these 10 property managers!
6. Income Tax Returns: it’s much easier to keep track of records for income tax purposes for a 10-unit shopping center than 10 separate residential rentals in several states. You just need to have one file for the shopping center while you will need 10 folders for 10 residential rentals. The task becomes more challenging as the IRS requires you to keep records for several years. Your out-of-state income tax return is also thinner for a 10-unit shopping center than 10 residential rentals.
7. Tax Write-offs: commercial properties offer the same tax write-offs, 1031 exchange as residential rentals.
8. Credit Scores Impact: most people don’t know that once they have about 10 residential mortgages, their credit scores will start going down. The credit bureau reasons that credit risk is higher the more money you borrow and 9-10 mortgages seem to be the threshold. On the other hand, commercial mortgages have no negative impact on your credit scores as these mortgages are not reported to the 3 credit bureaus.
9. Pride of Ownership: most commercial properties are referred to by name and not by their addresses, for example Lion Plaza, o
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