As business owners, we all prefer owning our own premises as opposed to renting commercial property. Although owning your premises looks very good on your balance sheet it may not always be the smart move. Here are five things you didn’t know about renting property in the UK.
Renting can be better than owning
In some cases, it may make much more financial sense to rent your business premises instead of purchasing it. Renting property doesn’t tie up as much capital as purchasing property does. In the early stages of your business, it may make more sense to use the capital for the expansion of your business. Rental agreements also offer more flexibility in terms of the location of your business, if you need to relocate for any reason whatsoever it is easier to do so from rented premises. Because of this many companies are looking for commercial property to rent.
Less red tape
Owning property in the UK comes with a lot of responsibilities and hidden costs. As a tenant you are only obliged to fulfill the terms of your lease agreement, it is up to the owner of the property to ensure that all other obligations are met. Renting property can save you a lot of time, money and frustration when it comes to maintenance and compliance with building codes.
Finding the right rental property can be a challenge
Looking for commercial property to rent can be a challenge! It is often a great idea to find a good estate agent to help you find the right property for your needs. You can negotiate with the landlord if you need any specific changes to the property. Your search for the perfect rental property will start with understanding your needs, looking for a property is much easier if you know exactly what to look for.
There are different lease types
Not all leases are created equal. There are several different types of leasing agreements that can be entered into. It is very important to consult your solicitor before entering into any lease agreement. While most lease agreements are rather straightforward some can be very complicated and require a good understanding of the contractual law. To avoid later problem’s, it is a good idea to have your solicitor give any agreement a thorough once-over before signing.
You are not subject to market movements
As a property owner, you are subject to the movements of the property market. Although property tends to be a safe investment there is still some risk associated with investing in property. As a tenant, you have no risk of depreciation of the value of the property. Sudden and unexpected changes can have a devastating effect on finances, protecting yourself against this risk by renting property is one way to manage your finances and keep unexpected costs at bay.
As can be seen from the above it can be advantageous to rent the property instead of buying, this does vary from situation to situation and you should, therefore, consult your solicitor and accountant before making any decision.