Protect Your Investment Property

 

There are many reasons why people invest in properties. You may be managing rentals in your retirement or making a career of being an investor. Owning an investment property or multiple properties should be treated like any other business.

Here are Three Important Ways to Protect Your Investment Property

Set Up an LLC for Investment Properties

There are still risks even when you do your due diligence before and after investing in a commercial property. It’s wise to make sure you are protected legally, especially when wearing the official title of landlord. How can you protect yourself from losing all your investment properties and your primary residence if sued? Set up a Limited Liability Company and transfer ownership of all investment properties to the LLC. Some investors set up one LLC for all properties or separate LLCs for each property. Another option is to consider liability insurance.

Avoid Property Negligence

Not taking care of an investment property, when you know maintenance needs to be done, can lead to a lawsuit. Sometimes property owners claim to lack the time or funds for structure repairs, updating locks, and the security system. A priority for property owners is keeping building occupants safe. Be honest about your time upfront and hire a property manager if you cannot take care of this yourself. Know what the expected repairs are before purchasing a property. Set a maintenance schedule to take care of painting, landscaping, routine building inspection and more. These steps will reduce the likelihood of negligence accusations.

Is Your Property Underinsured?

The amount your property is insured for should match the property value, which you learned from the property appraisal when you first purchased. One mistake owners sometimes make is assuming the insurance is adequate years after the initial purchase. This is also true with what the insurance covers. Do you know if all types of hurricane damage are covered? What about flooding? Know these details upfront and encourage your renters to purchase renter’s insurance.

At Ullian Realty our brokers are knowledgeable of all the important details commercial property owners need to stay on top of to successfully protect investment properties. Our brokers have a combined experience of over 50 years working with property investors in Brevard, FL. Call us today to learn more.

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Investment Property Due Diligence

Purchasing an investment property can help create a secure financial future, but you need to do your due diligence first. Just like any other large purchase, you want to make sure you are making a wise choice that fits into your lifestyle, before taking the leap. Here are areas of due diligence, from the experts at Ullian Realty, so you don’t have buyer’s remorse!

Due Diligence: Building

• Are there any issues with the foundation, walls, roof, electrical, plumbing, doors or repairs that will require a major investment to bring up to code?
• Are there cosmetic improvements needed to modify the building for your planned uses?
• Is there ample parking and shipping receiving?
• How many tenants can it accommodate?
• Environmental report

Due Diligence: Building Surroundings

• Is there open land surrounding the building that could accommodate future development?
• What other businesses are close to the potential investment?
• Would you share a parking lot with other businesses?

Due Diligence: Legal

• What are the local zoning ordinances?
• Would certain laws need to change in order bring your business plan to reality?
• Are there any litigation claims against the building?
• Are there currently multiple owners or a sole owner?

Due Diligence: Financials

• What is the appraised value of the property?
• Is the price of the investment property within your budget, or would you need outside investors?
• What are the average monthly utility expenses?
• Is the building set-up for WiFi and cable to offer cutting edge technology to businesses interested in renting?
• What are the most recent tax bills?
• Are there any tax credits available to cover the cost of making the building more energy efficient?

There are certainly other questions to ask, and research to complete, in order to do your due diligence when contemplating your next commercial investment property. Ask your commercial broker for guidance, and talk to other investors who have purchased similar properties.

At Ullian Realty our team has developed a thorough process to ensure you do your due diligence with every property you consider. With over 50 years of combined professional experience, our team is available to help you find the right investment property in Brevard County, FL. Contact us today to schedule an appointment.

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