No matter how much we save and invest, rising inflation rates constantly threaten to wipe out our investment gains! Savvy investors know that owning commercial real estate is one of the best ways to preserve their long-term wealth, and it offers significantly more upside than other types of investments. But there are never any “sure things” in real estate, and it’s essential to understand the pros and cons of every property before making an offer. That’s where we come in!
Ferstl Valuation Services has proudly offered trusted property appraisals in Little Rock since 1967, and J.T. Ferstl, MAI, is an Arkansas-licensed attorney with decades of experience as an expert witness in eminent domain cases and other property disputes. We also offer real estate consulting services to help you decide whether the property you’re considering is the right fit for your portfolio. There’s a lot at stake any time you buy or sell a property, and sometimes the best deals are the ones you walk away from! Here are a few things to consider before proceeding with any real estate transaction:
What’s the property’s fair market value? Property values are influenced by numerous factors, including location, amenities, and the recent sale prices of comparable properties. An independent appraisal is a good way to evaluate any potential investment, particularly if it’s been several years since it was last appraised.
What are your investment objectives? Many investors have strong ties to their local communities and purchase properties with the intention of owning them for the long term. There are also numerous aggressive investors who seek out bargain-priced properties they hope to resell quickly for a profit. Both strategies are valid, but renovations often cost more than you expect, and it frequently takes time to find a well-qualified buyer when you list the property for sale.
How much cash do you have on hand? One of the greatest benefits of owning commercial real estate is receiving monthly income from tenants, but you’ll also be responsible for servicing the mortgage when you have vacancies. You should also maintain enough cash reserves to pay for unexpected repairs, which typically come up at the most inconvenient times.
To learn more about Little Rock real estate consulting services or to schedule an independent property appraisal, contact us online or at 501-375-1439.
