Office with View

Lease vs Buy: Which is the Smarter Choice for commercial office space

Your company is growing and it’s time to move into a bigger, or maybe even a different space to meet the daily needs of your workers. The biggest question on company leader’s minds, “should we rent or buy commercial office space?” The answer, of course, depends on many factors — here is a guide to help you decide which path to explore further:

Why you might consider leasing

You’re not ready for a long-term investment. You haven’t found the perfect property to invest in for the long haul, or maybe you’re not ready to make a long-term commitment. It’s also a time and emotional investment —Owning real estate is a distinct, non-core business that will require your time, knowledge, and resources. Not having to worry about this frees you up to grow your business.

Tax benefits. Come tax time, you can deduct your lease payments and other rental expenses.

There’s no down payment. Investing in an office space, you have the benefit of a lower upfront capital investment. When you invest in an office space, you’ll need to factor in a large down payment, anywhere from 10 to 30 percent. When you rent, you’ll only need to pay a deposit that’s usually equal to one month’s rent, or first and last month’s rent.

Keeps your cash free. When you rent a commercial office space, this will free up more cash in the short term for you to invest back into your business or use for working capital.

No fuss maintenance. Depending on your rental terms, your property owner will likely be responsible for building maintenance and repairs. You’ll likely be responsible for keeping your office space clean and kept. Note, this could also be a deterrent depending on how quickly and efficiently the owner responds to any of your concerns.

A nicer space than you might have access to. It may be too costly to purchase an office facility in a high-end area, but with renting, you could have access to that high-end property you have your eye on for less money than if you purchased.

Flexibility. Leasing offers a variety of flexible options. You’ll have the option to choose a lease term that fits your company’s needs, the flexibility to grow or contract for both the short and long term, and the flexibility for an easy departure at the end of your rental period if you choose not to renew.

Why you might consider purchasing

Building equity and your brand. When you purchase a commercial space, you’ll be able to build equity. The longer you stay, your cost of ownership goes down on an actual cash basis. You can eventually use this equity as collateral if you decide to expand your business. Should it ever come time for you to sell, you could also make a nice profit. This may also create favorable perceptions in your market as your company is viewed as a stable player.

Increased cash flow. You can take advantage of low borrowing costs if you’ll be the owner-occupant. If the commercial space is large enough, you can rent out extra office space for supplementary monthly income.

Tax benefits. You can deduct interest payments on your taxes. Unlike a lease, you won’t be able to deduct your entire monthly payment, but you can deduct your mortgage interest expense.

Avoiding rent hikes. If you lease, your rent is likely to increase at renewal time particularly in high-demand neighborhoods, whereas if you purchase, your month-to-month fees will eventually decrease over time.

Design your own amenities. With a lease, you may be limited, or even restricted to the amenities you can offer your employees. With ownership, you’ll have greater control over the space and be able to scale and grow as your business expands.

You’re in charge of maintenance. While this could also be considered a point against purchasing, if you’re responsible for maintenance and repairs, you’re in control of how quickly you can make the repairs and get to control the vendors you use instead of being limited to previously approved vendors with a property management company.

Predictability. With a lease, the building ownership could change hands at any time. With a change of ownership comes unpredictability in many things like rental fees, amenities, and terms if you were renting. If you take out a fixed loan, your costs will remain steady and your monthly payments will never increase during the finance period.
small living space

5 Ways to Maximize Your Living Space

Since the real estate bubble burst, people all over the country have started doing more with fewer houses. Here are a few simple tips for getting the most out of your humble abode.

Use walls and ceilings.

Optimize your floor space by getting as many things as possible off of it. Hang your bicycle from the wall or ceiling. Install shelves for books and other items over doorways and, if possible, in walls themselves. Use the space above your kitchen cabinets for unused appliances, empty boxes, and china sets. Take advantage of corners, which are underused and provide a lot of storage space if used properly.

Brighten things up.

The more light you let into a room, the more spacious it will appear. If you have access to natural light, take advantage of it with sheer window curtains. If not, be sure each room is well-lit with lamps, chandeliers, and sconces. When it comes to painting, darker shades tend to impose on space. Instead, opt for lighter, softer shades, using bright colors sparingly as accents.

Use multi-function furniture.

Instead of that big wooden coffee table and bold, angular couch, opt instead for chests, sleeper sofas, ottomans and benches with interior storage space, etc. Use collapsible or nested end tables that can be folded or tucked away when necessary. Stick with vertical bookcases and push larger furniture pieces against the wall to avoid breaking up open space.

Take advantage of the outdoors.

Keep your lawn trimmed and your flowerbeds neat to avoid feeling crowded out by overgrown landscaping. Expand patios and hardscapes and install a grill to extend your kitchen and dining areas. Relieve the congestion in your garage with a tool shed or sheltered area for recreation equipment.
Discussion in an office

Does the brokerage matter when selling your house?

Anyone who’s bought or sold a house before is already aware that the right agent can make a big difference in your experience. But what about the brokerage where the agent is affiliated — does the brokerage involved in your home transaction really affect you as a consumer?

Brokerages can provide different services for buyers and sellers. If you’re selling a house, here are some of the things you can (and should) expect from many brokerages.

Marketing

One of the most important things that a brokerage does for sellers involves marketing their listing, letting qualified buyers know it’s available and providing the information those buyers crave in sleek and lovely presentations. Spend some time looking up homes in your neighborhood on Zillow and take a look at some of the photos and listing descriptions. You’ll probably be able to tell pretty quickly which real estate agents invest in staging and photos, and which ones try to skate by with smartphone snaps. Some of that has to do with the individual agent, but some brokerages have standards and parameters around what needs to be done to promote listings.

Education for you

Most people don’t sell a house every day — or every year, or twice a decade — so there’s a lot you might not know or remember about the process, and it’s part of your agent’s job to help educate you about the gaps. The agent’s brokerage can play a part in this, too, by providing resources and potentially even classes to help get you up to speed. You might not think you need to learn anything about selling a house, but at the very least, it’s helpful to get an idea of what the market is doing so that you aren’t surprised at the price agents to suggest when you start interviewing them.

Education for agents

The licensing requirements for real estate agents vary in every state, but each state requires some basic education in addition to continuing education as the years’ pass. Those are baseline requirements that might not cover everything an agent realistically needs to know to do business in your market, from legal restrictions to negotiation best practices. Some brokerages prioritize education for their agents more than others, providing seminars, webinars, reading materials, regular meetings, and other resources to make sure their agents know what’s new and what’s critical.

A network of buyers

One of the biggest reasons why a seller would want to use a real estate agent in the first place is because agents can help expose your home listing to a broad section of buyers who are qualified to buy your house and interested in your specific dwelling. This is why listing your home as a for-sale-by-owner can be risky — you don’t have access to the agent and brokerage networks of buyers. Some brokerages offer “coming soon” programs, where registered and qualified buyers can learn about homes that match their criteria. Others are part of independent or franchise networks that stretch across the country, so you can even reach buyers moving to your area.

A network of mortgage and title pros

Just like real estate agents, you’ll find a wide variety of mortgage and title professionals who specialize in different things. If you want a jumbo loan, or you’re purchasing rural property, or a condo or you don’t have a full down payment — all of those are situations where you might want to consider using a specialized mortgage broker who can give you a full range of options. Similarly, there might be idiosyncrasies with your home loan or liens on your house that require a qualified title professional to parse. You probably don’t know how to find these people, but your real estate broker will, and they’ll also know which mortgage and title operatives are responsive and helpful, and which ones sometimes take a shade too long to respond to your needs.

Processes and procedures for the transaction

Home sale transactions are complicated beasts, legally and financially and even emotionally. Some brokerages have streamlined processes outlined that their agents are supposed to follow to make the transaction easier for everyone, while other brokerages don’t oversee the transaction quite as much. Some brokerages also have administrative staff to help their agents with some of the transaction details, which can make a big difference to you as a seller because you might have a designated point person in the office to help keep you updated on your sale.

Help packing up and moving in

Not every real estate brokerage is a concierge brokerage that will help you dot all the I’s and cross all the t’s, but if that’s something you think you might need, then there are brokerages who will offer help with absolutely everything to do with your move. If you’re staying in town, they’ll arrange for movers to come to pack your things and transport them to your new home. Some brokerages also contract with a handyperson they book to come over to your new place and make any small fixes or adjustments that you’ve noticed a week or two after you move in. Others will provide help setting up your utilities and changing your address. As you probably know, when you’re in the middle of moving and selling your house, every little bit of help can make a big difference in your experience.

Neighborhood events

Brokerages at their best are community resources, and real estate brokers are people who know everybody. Some brokerages offer community events every now and then, such as summer barbecues or Fourth of July fireworks, harvest festivals in the fall, holiday celebrations, Easter egg hunts — the list goes on. If you’ve worked with brokerages established in certain neighborhoods, these events can be an excellent way for you to meet your fellow residents and mingle a little bit.

Ongoing information

When it’s 9 p.m. and you need an emergency plumber, or your electricity goes out on Christmas Day, do you know who to call? If you don’t have a contractor on hand already, talk to your real estate broker about people they recommend. They’ll know people who can paint your house, pave your driveway, fix your water heater, or install a fence, and they’ve probably also heard all of the stories around town about every contractor, so you can save yourself some time and headaches by just starting with your brokerage first.

Most sellers don’t think about their real estate brokerage in terms of a resource, but the best agents affiliate with the best brokerages for a reason. If you aren’t sure whether it will make a difference if you list with one brokerage over another, do a little bit of research into what they offer sellers and compare them to ensure you’re choosing the best brokerage (and agent) for your home sale.
person carrying packages

How To Move On A Budget

As anybody who has ever bought a house before knows, real estate is quite expensive! Many buyers, although elated that they’re about to be homeowners (either for the first time or in new digs), also realize that they need to budget carefully for their move so they don’t get overextended during their new-home honeymoon.

What do you need to know in order to be able to move on a budget — and get it all done without losing your mind? Here are things to consider.

Assess your time vs. money situation

The economics of moving your household are pretty simple: If you have the time to do it all yourself, then you won’t have to spend any money. Or, if you have enough money to pay for other people to move you, then you won’t have to spend any of your own time.

So the first thing to think about is how valuable your time is and how valuable your money is right now. This will likely be different depending on your life stage, what you do for a living, and how much time you have available to you for your move. If you’re a first-time homebuyer in your 20s with no kids, then it might make sense to do more of the moving yourself; if you’re a move-up buyer in your 40s with a big household, then you might want to think about using your time to make enough money to pay movers.

Don’t eliminate options without doing some research

One insidious thing about trying to budget for a move is that it’s not always apparent which option is actually more expensive. By the time you pack up your entire house, spend your money on a truck, and fill it up with gas as you drive — are you really saving that much over a flat-fee moving service? Possibly, but quite probably not.

Look into all your different options and consider all of the different expenses and components that go into them. This is probably going to take some research; a full-service moving company is obviously going to do more for you than a flat-fee company, but how much, exactly, are those differences worth? Would it make the most sense to pack your stuff up yourself and hire movers to haul it to your new place?

While you’re exploring your options, make sure you’re checking review sites like Yelp so that you know what kind of quality you can expect from any moving services you might hire. Evaluate how much hiring a truck and paying for gas and mileage could cost you. And think about alternate options, like a PODS (portable on-demand storage) module that you can fill up with your belongings for a truck to haul away.

Platforms like TaskRabbit can also be good ways to facilitate a move if you don’t want to go with a full-service or flat-fee mover. Maybe instead you can hire a couple of people on TaskRabbit to help you shlep boxes.

Time your move as best you can

You’ve probably heard the saying “timing is everything,” and that is also true when moving. You could save a significant amount of money by timing your move to coincide with low-demand times of the month or of the year.

Summertime, for example, is a pretty expensive time of year to move. Lots of other households are trying to take advantage of both the weather and the break from school to make changes in their lives, and if you can wait until the fall or winter to move, then you’ll probably get some better rates from any moving companies you talk to.

Moving companies also tend to get booked up toward the end of the month, when many leases expire, so if you can time your move at any other time of the month, that can also be helpful. Weekly timing also can affect your budget; weekend moves are almost always going to be more expensive than moving on a weekday. And even the time of day matters, when you factor in a rush-hour — if you rented a truck and you’re stuck in traffic with it, you could incur a late fee, so try to avoid moving during peak traffic hours.

Get rid of as much as you can

Minimalism might be having a bit of a moment right now, but even if you’re a packrat, you have to acknowledge the wisdom in the concept that you won’t have to pay to move things that you don’t own anymore. When you’ve determined how much time and money you can spend on your move, and you’ve figured out when you’ll be moving, it’s time to start narrowing down what to move as much as you possibly can.

Start with any big items that don’t appeal to you as much as they used to, or that won’t fit in your new place, or that you don’t need anymore. There are all kinds of ways to get rid of things today, including Craigslist and Facebook Marketplace; take pictures of your items and advertise them online.

You can always donate anything that nobody buys, but you just might make enough money off of your virtual garage sale to help pay for movers … especially once you’ve reduced what they have to move.

Don’t pay for boxes

When you’re moving on a budget, boxes are one of the very last things you should pay for — there are so many ways to get free boxes to move your things, and they can really add up if you’re buying them new from the truck-rental place.

Where can you find cheap or free boxes? Try your workplace, first and foremost. If you work in an office, there are probably boxes for printer paper that work well for moving. Restaurants get food delivered regularly, and that food arrives inboxes. Grocery stores and liquor stores also often have repositories of boxes, and if all those fail, you can always beg your friends on social media for any boxes they have handy to spare.

Use what you have for packing materials

Bubble wrap, like boxes, is one of those moving expenses that feels especially painful; it’s disposable and literally only used to get your belongings safely from one place to another. One easy way to save money is to use the fabrics in your house — sheets, towels, blankets, coats, sweaters, and so on — to wrap breakables like your dishes or vases.

This does work well, and your items will arrive intact at the other end; however, you may find yourself with quite a bit of laundry to do as you unpack from your journey. You’ve been warned!

Consider USPS Media Mail

You wouldn’t think that mailing yourself your belongings would be a very cost-effective way to move, but that’s probably because you’re not familiar with USPS Media Mail. This is a service that allows you to mail certain educational-material items, such as books and movies, at a very reasonable rate. (Unfortunately, comic books do not count.) The Media Mail rates are based on weight, but once you do the math, you might discover that mailing the bulk of your books and movies will allow you to rent a smaller vehicle and save a lot of money.

Do what it takes to get your deposit back

If you’re renting, then you probably put down a security deposit on your place. What are the odds that you’ll get it back? This can be an easy way for landlords to earn money; people are tired after packing up all their things, and one of the very last things you want to do is scour the house you’re going to leave.

But don’t get lazy and hand over that hard-earned security deposit to your landlord. It’s already been sitting in their bank account, accruing interest that’s not yours — now it’s time to get that money back and make it work for you instead.

Write it off if you can

You might have heard that you can write off a move for work on your taxes. This was true until 2017 when the tax law changed; now, the IRS no longer lets taxpayers write off moves for employment on their federal return — but some states, such as California, still allow residents to write off a move. Look into your local state laws or check with an accountant to see if you could get some kind of break for your move.
Yes/No Checklist

Annual Home Maintenance Checklist

If you’ve been a homeowner before, you know that just like your vehicle needs regular maintenance like
oil changes to run well—so does your home. It can be easy to ignore or put these things off, but a well-
maintained home will save you money from costly repairs in the long run, and make your home easier to

sell when the time comes.

While this list is comprehensive, it’s not a complete list of all the things your home needs.

Monthly

  •  Change HVAC or furnace filters. If your family is small and pet-free, simply inspect the filter and replace it every 2-3 months.
  •  Clean range hood filters. Mix a degreaser with hot water, let it soak, then rinse it off.
  •  Check water softener. Check the salt level, add some if needed, and read the display to make sure no error codes are displayed. You’ll usually only add salt a few times a year.

Biannually

  • Deep clean. Roll up your sleeves and deep clean appliances, windows, lighting, and every crevice and corner. Keeping a clean home and not letting dirt build-up will help keep it polished.
  • Test the pressure relief valve on the water heater. This prevents corrosion—protecting leaks and helping it run efficiently.
  • Replace batteries in smoke/carbon dioxide detectors. Make it a habit to change batteries every time you set the clocks for daylight savings time.
  • Vacuum refrigerator coils. The fridge can account for up to 15 percent of your home’s total power—keep it running efficiently.

Annually Organized by Season

Spring – There’s a reason it’s called “Spring Cleaning”

  • Service central air. Do this before it gets hot and you can often get this done at a discounted rate with enough time to spare before it gets sweltering hot.
  • Check gutters and drainage. When April showers start coming down, will the water flow away from your house? Keep gutters clear so the water can flow where it’s supposed to.
  • Test sump pump. You don’t want to wait until you need it to find out it’s not working!
  • Check grout in the bathroom and kitchen. Fix the grout where needed—This will extend the life of tiled surfaces and keep them looking new.
  • Check windows and screens. Clean window wells of fall and winter debris.

Summer – Shift your focus to the outdoors and enjoy the sunshine

  • Clean ducts, sweep the chimney and get heating systems ready. You’ll be turning these on at the first hint of crisp fall weather, so do this now.
  • Check and clean the clothes dryer vent. While running, check the exhaust for the smell of fresh laundry. If the exhaust is marginal, check for blockages. Also, vacuum the lint from the dryer hose.
  • Clean garage. The garage is easy to ignore, get out there while the weather is nice, and check garage door sensors are working while you’re in there.

Fall – prepare for winter during this in-between season

  • Winterize A/C systems. Store window units, and if you have central air, cover the outside unit with a tarp and fasten with bungee cords.
  • Flush and store hoses. Drain the water so it doesn’t freeze.

Winter – cozy up and stay warm

  • Break Icicles. As pretty as they look, don’t let them grow—they could fall unexpectedly and hurt someone and can get can cause damage from their weight. When they melt, they can cause water damage to the foundation.
  • Remove showerheads and clean deposits. This will keep your water pressure strong and keep them lasting long.
  • Check the foundation for cracks. Use caulk or silicone to repair any small cracks before the Spring thaw.
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