Property Investment Archives - GB Construction Australia

Commercial Buyers Agent vs Residential Buyers Agent: Top 3 Key Differences

May 22, 2023June 20, 2023 Tahlia Marin

If you’re entering the real estate market, you’ve probably been considering hiring a buyers agent. However, before you start hiring agents to represent you, it’s important to understand the different types of agents in Australia and how they can help you.

In this article, we’ll get into the differences between a commercial property buyers agent and a residential agent. These are two of the most common buyers agents that offer services to investors.

Below, we discuss the responsibilities and roles of each agent. That way, you know exactly which type of agent to hire for your next property purchase.

What Is a Commercial Buyers Agent?

As the name suggests, commercial property buyers agents are trained to help clients buy commercial property. Commercial property in Australia is part of a completely different property market. This means that a successful purchase largely depends on your know-how and a general understanding of the local commercial real estate market.

Commercial property is a type of real estate that isn’t for living. So, it could be office spaces, commercial buildings, and similar structures. These properties are primarily for generating income, which is what sets them apart from residential properties. Since they are income generators, commercial properties have a wider set of rules and regulations. learn some of the best skills required by buyer Agents at https://gbconstructioninc.com/skills-to-possess-as-a-melbourne-buyers-agent/

If you aren’t experienced in the world of commercial property, it will be hard to find a suitable property. There are very small details with commercial and industrial properties that you should always consider before making your property investment. That said, it takes a lot of time and knowledge to understand the intricacies of the commercial property market.

A commercial buyer’s agent is trained to help you with a commercial property investment. Their unique skills and experience make them more than qualified to help you with commercial property transactions.

When you hire a commercial buyers agent, you can expect a partner throughout the entire buying process. When you pay for their services, your agent will go through the entire commercial real estate market in your area. From there, they will look for the right commercial property for your needs.

Before searching for property, commercial buyers agents typically ask the client about their needs and preferences. That way, they can tailor their search to what the client needs for their property portfolio.

From there, they will advise the client on the ideal commercial property based on various factors, from current market trends to personal preferences. A good agent stays with you throughout the entire process of purchasing commercial property, which is why they are well worth the investment.

What Is a Residential Property Buyers Agent?

Residential properties are a completely different market from commercial properties. This is why there are also buyer agents that specialise in helping their clients find residential properties. So, if you’re looking for your first home or even an investment property to rent out to tenants, these are the agents you’ll need by your side.

The residential buyers agent service looks very similar to commercial property agents. These agents scour the entire property market and advise clients. The only significant difference in these services is that residential agents search for different types of property.

Key Differences Between Commercial Property & Residential Property Agents

There are many differences between a commercial buyer’s agent and a residential one. Aside from the types of property, they look at, their contracts and costs also vary. Before hiring a residential or commercial buyers agent for yourself, it’s imperative to understand these differences.

In this section, we dive deeper into the key differences between these types of buyers agents. This will make it much easier to determine what type of agent you need before entering the market, giving you an edge over the competition.

Target Markets

One difference between residential- and commercial buyers agents is their target markets. Commercial property buyers are very different from residential property buyers. While some people may purchase residential property to rent it out as an investment, this is a very different market from the typical commercial property buyer.

Typically, people interested in commercial properties are experienced investors looking to expand their portfolios. These people need a different type of advice and approach to their property search.

Property Types

Commercial property types are very different from residential properties. As mentioned earlier, a typical commercial property is used to generate income. When you buy commercial property, you typically convert it into a commercial space like an office, store, or similar establishment.

On the flip side, residential real estate is any structure or property where people live. Even if you don’t live in the property, as long as it was designed to be lived in, like an apartment, semi-detached home, or full-detached home.

Costs

Finding a suitable commercial property for a client isn’t easy. On top of that, commercial investors usually require comprehensive services and a lot of property advice. Before you invest in commercial property, you need to do a lot of research and data gathering. It usually takes a bit more time to find a commercial property because there are so many factors to consider, and it’s easy to get overwhelmed.

So, when you hire an agent to help with your commercial property investment, expect higher costs than your typical residential agent. While both buyers agents help you find the right property at the best price, most commercial property buyers agents charge higher fees than residential ones. Learn more property facts by clicking here

However, you can rest assured that whatever you pay for your commercial property buyer agents, will be worth it. Not only do they make investing in commercial property much easier, but they help guide you towards the best property for you!

Conclusion

Commercial and residential property buyers agents are very different from each other. Both agents will help you find off-market properties, negotiate with sellers, and help you enter the market. However, the property types they focus on are very different. So, before hiring an agent, make sure to understand these differences to make it easier to hire the right one for you.

Your guide to property investment in Australia

November 22, 2022February 9, 2023 Tahlia Marin

If you want to begin making real estate investments or are already a landlord and want to maximize your returns, this guide will share the risks, benefits, and tips to make the most of your real estate investment.

Before making a property investment decision

Property investment can be a proven and low-risk way to build wealth, but it does carry some risk. Before making a property investment purchase, carefully weigh the benefits and risks to determine whether it is a viable investment for you. You can do a self-assessment by consulting professionals and educating yourself to determine how much risk you’re willing to take on, and you can look clearly at the risks, so you know what lies ahead.

Examine the risk

Investment property is generally considered less risky than other options such as stocks, but you must still assess the risk of the investment. You should do a cashflow analysis with an accountant, property advisor, or financial planner’s assistance when determining the risk level. It’s critical to consider all the expenses associated with owning an investment property so you know exactly how much you can afford.

How expert advice can improve your chances of success

Talking to a professional about your real estate investment goals is a good idea. Consult with accountants, property experts, conveyancers, buyer’s agents, local real estate agents, financial planners, and mortgage brokers to determine whether the property will be a good investment.

An accountant can assist you in assessing your cashflow and managing the paperwork associated with the property purchase. In contrast, a mortgage broker can compare different home loans to ensure that you get a competitive deal that meets your borrowing and investment objectives. Before you sign on the dotted line, a solicitor can assist you in interpreting and preparing legal documents.

To get guidance on buying an investment property and the best kinds of properties to fit your financial goals, think about chatting with a buyers agent sydney or property expert.

Conducting research

Immerse yourself as much as possible in information and research. You can use tools like the Australian Bureau of Statistics (ABS), CoreLogic Data, Residex, and many more websites that offer data and insights on the real estate market that can act as the basis of your preliminary search.

Create a property purchase strategy and write down all the important decisions you’ll need to make throughout the process, from determining your investment strategy to obtaining financing, signing paperwork, and screening potential tenants.

What is your property investment strategy?

After consulting with an accountant and a financial planner, you should know how you intend to profit from the investment.

The following are the most common property investment strategies:

Purchase and hold: Buy the property, then wait for its value to rise before selling. Rent income can cover mortgage payments until the property is sold.

Add value by renovating: Purchase the property, renovate it to increase its value, and then resell it for a profit.

Capital appreciation: Some investors attempt to zero in on a property and location that will rapidly increase in value in the current market. These investors may use interest-only investment loans to reduce non-deductible costs and then sell the property after a few years.

Finding the ideal property

The most important step is probably finding the right property. You must find a property that fits your property investment strategy, is appealing to renters, and will hold its value over time. You must also ensure that you are paying a fair price for the property and that it is structurally sound.

You must make decisions on the following issues:

Property type: Will you buy a condo, a detached house, or a townhouse?

New or seasoned: Some investors prefer to buy brand new buildings, while others see more value in existing homes:

Suburb: The suburb and location you choose significantly impact your investment. Look at suburb-level data and get out on the streets to see for yourself.

Rental return and capital growth

Regardless of your strategy, you must purchase a property with capital growth potential and one you can rent out. In short, you must run the numbers to determine whether the investment makes financial sense. You must also ensure that the return on your property is comparable to the return on investment in another asset class, such as stocks.

Capital growth

Capital growth is the increase in the value of a property over time and is why most people invest in real estate. The property market works in cycles, with periods of growth, stagnation, and decline, all of which have occurred in the Australian property market. Given this, it is clear that investing in real estate should be done for the long term rather than for a quick return.

How much money can you anticipate making over the long term? This is determined by the size and type of property, the location, and the local growth drivers. A land-locked suburb with no more land and a growing population will have high demand and low supply, putting pressure on property prices.

Rental income

Examine the average rental price for similar properties in the area and consider whether the rent you receive will be sufficient to cover property maintenance costs while still allowing you to profit.

The yield of a property is an important figure that is calculated by dividing the rent received over a year by the price paid for the property, which is then multiplied by 100 to get a percentage.

Remember that when you invest in real estate, you are leveraging your deposit. You could begin with $50,000, but your 5.2% return is calculated on $500,000, not $50,000, which is likely to be the same amount you would invest in stocks.

Obtaining a mortgage for an investment property

Are you ready to begin and apply for an investment loan?

You must establish the proper borrowing structure at the start of your investment journey. To maximize your tax and financial benefits, get the right loan in the right amount and name.

Make sure that you do the following:

Determine your borrowing capacity: Before comparing different home loans, you must first determine your borrowing capacity.

Compare mortgages: Look for a suitable investment mortgage with a low interest rate. Keep an eye out for exorbitant fees as well.

Get pre-approval for a home loan: Check with a lender to see if they offer pre-approval for a home loan, preferably with a credit. Before you begin looking at different properties and investments, you must first determine your budget.

Final Steps

After you’ve found a property to buy and begun the home loan application process, you must complete the following steps:

Prepare mortgage paperwork: To finalize the mortgage documents, contact your lender.

Hire a quantity surveyor: A quantity surveyor can assist you in maximizing the tax deduction from the property.

Landlord responsibilities: If you want to rent your investment property, learn about your landlord’s rights and obligations and how to advertise appropriately. A conveyancer should also check the property’s boundaries if the investment is larger than an apartment.