|April 17, 2019||BAD DECISIONS MADE BY SUCCESSFUL BUSINESS OWNERS||no comments|
YES AFTER CONSULTING WITH 4 LARGE COMMERCIAL OUTFITS IN QUEENS, NY IT IS OFFICIAL.
SUCCESSFUL BUINESS OWNERS WHO MAKE ABOUT A HALF MILLION A YEAR ALWAYS TEND TO MAKE THE WRONG DECISIONS WHEN IT COMES TO REAL ESTATE. HERE IS AN EXAMPLE.
An owner of a business who happens to be successful, making very good money, and pays currently $5,000-$8,000 in rent to a Landlord looks for a Commercial piece of Property to purchase and occupy. Ergo having the down payment, getting a mortgage, not having to pay ridiculous rents anymore because they are now the owner of a building and what is called a USER. Terrific write offs, great appreciation on the building and if there are other rents within the building they also collect rents and can increase the rents or rental income in the future.
For over 50 years buyers who are users(to occupy a premise) statistically pays a small premium above the typical investor to insure getting their offer accepted. In todays market investors look to purchase at 13 x's yearly income to 14 x's income depending on location/condition. On the other hand 'USERS' have paid an average of 14.5 x's yearly income and in some cases 15 x's income just to get that building, in that location which may never come up again.
But 90% make the wrong decisions according to 4 very experienced Brokers who watch the deals just go south because of small amounts of money.
So remember even if you know a successful business owner, and he or she makes a half million per year, it doesn't mean they know everything. And people are people and no matter if you make $60,000 per year or $1 million per year, people chronically make mistakes.
For over 50 years to date, Literally 10's of thousands make Real Estate mistakes by not going up and spending an additional $100 to $300 dollars in a mortgage payment per month.
As Google founder says sometimes you just have to go for it. When you're not speaking of another Million dollars, and just small amounts, that should not deter you from buying. It's peanuts really. Amounts under $100,000 today when you are speaking about a $2 million dollar property or a $7 million dollars property purchase is the difference between success and failure.
Brokers and owners and buyers who experience this scenario are always shaking their heads when it comes down to this.
THERE ARE NO DO OVERS IN REAL ESTATE
And lastly, Brokers always hear the property is too much money. Not nothing new. But however, if you are a tenant be sure to understand in the future that when your rent goes up, you're going to wish you had bought a property.