Archive for the ‘Home Rentals’ Category
Lease or Buy a commercial
One of the biggest costs when starting a business, usually the purchase or lease the space to operate. The decision to buy or lease the premises for a business depends on several factors, but definitely the biggest factor is the capital or financing available.
Before taking this decision we take calculated what the total investment in business, whether on stage where they bought the place, like the one just to rent. Then, we calculate the projection of future revenues and expenses, and, accordingly, consider whether we would be able to pay monthly debt as a result of local purchase, or if we would only be able to pay rents.
Usual in the case of a single employer, or a small business, is that local purchase is out of reach.
If we choose to apply for a loan to purchase a facility, unless we have a good line of credit, it is usual that the bank ask us to put at least 25% of the total required.
However, the monthly payment of rent is usually one of the biggest costs in a business, so that the ideal would be to buy local.
If we can get adequate funding for it, would have the advantage of owning a tangible asset which could take a long term investment, pudiéndola sell at any time, for example, if the business does not work. In addition we would have the advantage of having greater control over the premises, for example, to do all the renovations you want.
If however, if we are not in the ability to get financing to buy a local, the other alternative is to rent one, then only we would focus on getting the funding to remodel and equip.
The rent space allows us to substantially reduce investment, and if the business fails, will also reduce losses. In other words, we can minimize investment and risk.
Although the disadvantages of renting a room as mentioned, involve having to pay constant and permanently high amount of income, besides the possibility of having to answer for the entire period the duration of the lease, in the case we decide to close the deal before.
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