Commercial vs Residential Properties

Rental properties can make for very promising investments. However, one rental property isn't necessarily the same as another rental property, which is why you need to be clear about the differences between commercial properties and residential properties.

Investing in Commercial Properties

Commercial properties are aimed at businesses. They tend to have higher rates of return. Something that is particularly true because commercial properties tend to have an easier time increasing in value as well. On top of this, commercial clients are likelier to respect your rules, so there is an increased chance of your relationship with them being problem-free.

Investing in Rental Properties

Rental properties are aimed at consumers. They have a much lower cost of entry, so more people can invest in rental properties than in commercial properties. Furthermore, there is a bigger pool of buyers as well as renters for these properties because everyone needs housing. In bad economic times, this means that rental properties can be more resilient. This doesn't mean that you will be able to find tenants and keep tenants with no issues whatsoever. Just that it won't be as bad as doing the same for commercial properties, which can get hit hard because businesses are some of the first to feel the effects.

What Do You Want?

Neither commercial properties nor residential properties are clearly better than the other. Instead, you need to think about a couple of things. One would be what you want to get out of investing in rental properties. The other would be what you are capable of investing in based on your resources. This knowledge should make it much easier for you to figure out which option is better-suited for you.