Commercial real estate can be a highly profitable industry. However, not every investment turns out well and some people have lost a lot of money in this field.
If you want to increase the chances your investment is profitable then learning from the experience of others can help. Here are two reasons why commercial real estate investments have failed in the past:
1. There were issues with the title
The last thing you need after investing a considerable amount of money in real estate is to find yourself in a dispute over ownership. People can and do try to sell properties that are not fully theirs to sell due to an inheritance dispute, an outstanding lien or confusion over the boundaries.
Sorting such issues out can take a lot of time, leaving you in an uncertain situation where your money is not working for you.
2. Plans for development affect the property
Imagine buying real estate and investing further money in it only to be told that it was all in vain as you need to sell up. This could happen if the government seeks to make a compulsory purchase order to facilitate another development, such as a new road. To make it even worse, the price the government is willing to pay may be much less than what you paid, let alone your total investment. Thorough research can help you determine whether any such projects have been proposed or are likely to be proposed in the future.
These are just some of the reasons why getting legal assistance to carry out thorough checks before committing your money to commercial real estate is wise.
