“Should I sell my business?” one might wonder after several years of business operations not achieving the goal for the company—or worse, not churning out any profits. It is a viable choice to sell the business because you might just incur further losses if you do not. As we all know, it is very hard to survive when you are swimming in tons of debts. However, do not be so quick on selling your business. You might still turn this thing around.
If your business has a good office space, you might consider converting it into a long-term rental property. Remember that your property still has a value and you might want to capitalize on it, especially if the office is located near commercial and essential establishments. It is also a plus if it is very accessible.
Making your business real estate a long-term rental property in Australia can provide you with a stable and consistent revenue stream without even working every day. It is like having a regular pension even before retiring. However, there are many things you need to remember to make this new venture successful.
Here are some of the things you should take into account when opting to have a long-term rental property in Australia.
Setting the Rental Rate For the Long-Term Rental Property
When pricing the rental rate, you have to consider the following:
- size of the property
- functions of the property
- location of the real estate
These are the primary factors you need to consider so you can come up with a reasonable rental rate. At the same time, you also put in mind the market value of the nearby properties in your location. Make sure that it is competitive enough to attract tenants.
It is also wise to make a comparative market analysis to give you further insight on how to compute the rental rate. After doing so, you can also compute how much will be your earnings after a particular period. You might also adjust the rental rate according to your financial goals, if possible.
Picking the Suitable Tenants for Your Long-Term Rental Property
Having the right tenants in your real estate can give you a fortune. Remember that they are a source of income, so you might want someone who meets payment deadlines consistently. You would not want a bad tenant who caused damage on the rental property because it will cost you as well.
You would also not want a tenant who does not intend to stay for a long time. The period you spent looking for another tenant means loss of rental income as well.
To get to know the tenant prior to the signing of the rental contract, you can do the following:
- conduct a personal interview
- do background checks
- look into credit score review
- ask for landlord referrals, if necessary
Evaluating the Rental Property Expenses
Among the things you should really watch out for is your expenses, like in any business. You would not want to be incurring more expenses than you are earning money—that just means you are not generating profits at all. Here are some real estate investing tips to help you save some money:
- Study the rental property tax deductions so you can apply them in your business.
- Always keep up with the maintenance of the long-term rental property.
- Perform regular checkups of the property to avoid serious damages.
- If you have extra money, do some enhancements in the property to maximize the rental rate.
Buying and Selling Business
If you need to learn more about business takeover in Australia, reach out to Easy Buy Sell Business. We are a business for sales platform ready to help you and your needs. Contact us today.