Is it better to buy or rent the office space?
One of the key things to a successful business is a suitable office space. After all, the office is the “face” of the company. If it is clean, cozy, tidy and located in a convenient transport interchange and a good building, clients and employees will be pleased to be there. Accordingly, your profit from this will only grow. At the beginning of their own business or after several years of successful promotion, many businessmen ask themselves which is better: buy an office space or rent it? We shall know the best choice to go with after going through this guide.
Renting an office space
If the business will only operate for a few years
It is worth taking a lease if your business is designed for only a few years; that is, it is not a long-term enterprise. Of course, you can buy an office space in the hope of selling it later at a better price, but keep in mind that this does not always work.
If you want maximum flexibility
You are not tied to location, square footage, or monthly payment longer than the lease term when renting an office space. You can move out of the space anytime you wish.
If you are an aspiring entrepreneur, then renting an office is a good option. After all, you do not yet know for sure if you will succeed in building a business or not? Be realistic and remember that, unfortunately, more than half of startups fail in their first year.
The fact is that office real estate often falls in price, especially if the premises are difficult to modernize and adapt to your needs. After all, the office real estate market is constantly evolving, introducing new design and construction technologies solutions. Thus, if you have purchased class A premises, having paid the appropriate price for it, it may already turn into a class B office in a few years.
In addition, you should realistically calculate your financial capabilities. It is not worth spending most of the startup capital on buying premises – remember that you will also have many other costs when starting your own business.
On the other hand, if you are confident in the success of your business, in the long term, buying an office space will be more profitable than renting it. After all, the rental price, for example, for five years, can exceed the cost of the office itself.
Consider also the state of the real estate market at the moment. If prices have just risen sharply, it would be wiser to wait at least some time with the purchase of your own office. Take into account other factors as well, such as how quickly your business will pay off, what the expected profit will be, and your firm’s overall plans for the foreseeable future.
Is it better to buy office space?
Investing in real estate is a great way to make money, as the value is guaranteed to increase over time. Besides, you will be free to make any improvements you wish to your property.
If you decide to buy an office, you should forget about excessive savings. And if you are already buying, it is better to choose a good room that suits you in all respects, even if it costs more. Consider the location. Buying office space in an area that is developing can be very profitable.
Agents recommend businessmen choose the most optimal one-class B offices. These are already equipped premises that lend themselves to modernization and improvement. That is, you can remake it for your own needs without any problems.
You can also rent or purchase premises in the business center. Thanks to this, you will have everything you need from the very beginning – both the Internet and a ready-made security system, an aesthetic interior, as well as restaurants and even entertainment establishments where you can hold a corporate party with your employees.
Sometimes apartments in residential buildings located on the ground floor are also used as office premises. But renting them can be more expensive than non-residential premises.
We can say that buying an office space is better than renting. But, there are circumstances when renting will be a smart move. For instance, when you’re starting a business, renting might be an ideal option.