Rent or buy business premises – which is best for you?
Most businesses starting out will choose to rent business premises as it gives greater flexibility and avoids tying you down at a time when many things are uncertain and unpredictable.
Renting commercial property has a number of advantages to offer – mostly around greater flexibility and lower responsibility:
- It avoids tying up capital, money which can then be used to invest in the business
- In addition to rent the up-front costs are often relatively low. A refundable deposit may be required under the terms of the lease
- Relocating when you out grow the premises is easier
- Costs can be more manageable as you can enter into a short or long term contract and are not exposed to interest rate rises and the financial shock of a fall in commercial property values
- Depending on the terms of the lease you may have less responsibility for the building, certainly maintenance to the exterior of the premises might not be included by the landlord
Renting offers many benefits but maybe buying will suit your needs better? When you buy a property you are in control:
- You have the freedom to use and alter it as you wish – subject to planning regulations or any conditions imposed by the bank.
- If you have spare cash to invest there is the opportunity to profit from the building when you sell it, if it gains in value
- You can move when you wish as you are not tied to a fixed term contract
- A fixed-rate mortgage may make forecasting costs more predictable
- Letting the property in the future can provide another income stream
For most businesses the decision comes down to their individual circumstances:
- The budget and funds they have available
- Their requirement for flexibility – short / long term commitment
- The level of responsibility / control they are comfortable with
Identify your needs and then work out what the best fit is for your business and ambitions over the next few years.
Moving premises, much like moving home, is a serious undertaking so it pays to take time to get the right decision for you!
More details on the Stour Valley Estates business parks and our other commercial properties to let can be found on this website, or by phoning our Property Manager Katie Dove on 01304 849210.