BUILDING - Buy or Rent

Discussion in 'Business Operations' started by scraper69, Apr 23, 2007.

  1. scraper69

    scraper69 LawnSite Senior Member
    from mi
    Posts: 477

    I have an option to buy a building but am leary of jumping into such a commitment right now. The owners want $1000.00/mo for rent and its worth about $100,000. 1400sf. with outside parking. What to do???? If i pass on the inside rent of $1000.00 and dont buy now, someone will come in and rent and then he may want to buy in future. I could (hopefully still get the outside parking areas at a reasonable cost, but how long would that last?? NOTE - I am dealing with family (inlaws) here in this situation, and they are really pushing me up against a wall. I am so confused.... do I look elsewhere? or bite the bullet. (2 trucks 2 trailers and a ton of small tools and winter plows...
  2. Tony Clifton

    Tony Clifton LawnSite Senior Member
    Posts: 865

    In most situations you want to lease, not buy.
    However, for 100,000 you might as well buy.
    The payment should be less than the rent you would be paying.
    How much land is there?
  3. pclawncare

    pclawncare LawnSite Senior Member
    Posts: 991

    Also if it has outside parking you could buy the lot and then rent the out side lot area to someone who is looking for a place to park their trailer or boats or mowers what ever to suppliment your payment to the bank. The other day i herd a seminar on how to become a millionaire from an entrepreneure(spelling). He said the most important thing to do when you can afford it is to buy the underlying property that your business is operated on. HIs point being even if your business fails the property will most likely be worth more in the comming years due to increase construction cost and propertys becoming more scarce. He said often times when he sees beusinesses that sell the property they are operating from brings more money than the business its self.
  4. Mike Fronczak

    Mike Fronczak LawnSite Senior Member
    Posts: 301

    Look at what else is around also (in real estate called comps), for 100K, THATS CHEAP if its zoned properly buy it in a heart beat. If needed rent out part of the lot, building etc.
  5. TSG

    TSG LawnSite Senior Member
    Posts: 444

    A company with realestate is always worth more than one without.
    Buy it personally and lease it back to the corp.
    You can get creative with this one

    TJLANDS LawnSite Bronze Member
    Posts: 1,669

    Buying property is the way to go. This will almost always increase in value.
    Hell, I will buy it and rent it to you.:laugh:
  7. naughty62

    naughty62 LawnSite Senior Member
    from iowa
    Posts: 368

    Acre on the outside of city limits .outbuildings ,old barn , well water,room to scatter equipment around ,room for plantings and arbs,room to build ,room for secondary containment or what ever .Example; 1985 building was sale for 25Gs. rented for $600/mo. . 22 years later a guy could not touch it for less than 75Gs . It is not hard to figure ,with long term goals . Zoning ordinances and suburban enchroachment can be an issue.
  8. scraper69

    scraper69 LawnSite Senior Member
    from mi
    Posts: 477

    Def. on the personally to corp. Unfortunately this Michigan economy sucks right now, so many buildings (most larger) for sale or lease around here.... and dont know if I should bite the bullet or pass on it.... I hate decision making.
  9. mini14

    mini14 LawnSite Member
    Posts: 236

    r u crazy ? buy buy buy

    TJLANDS LawnSite Bronze Member
    Posts: 1,669

    This is the time to buy, before things get hot again...and they will.
    If I am doing the math right at most will cost you 500 a month more.

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