All the growing businesses are facing this question of buying vs leasing office spaces. There are many pros and cons to this question. Small business owners will have to carefully weigh the pros and cons of buying vs leasing an office for sale singapore.
For making the decision easier below are some of the key facts for buying vs leasing office spaces.
Pros of Buying Office Spaces
Fixed Costs: You will get clear fixed costs when you mortgage the long term locking.
Tax Deductions: Tax deductions are provided to the commercial space when it is owned and runs. This could be in the form of property taxes, mortgage interest, or any other items.
Additional Income: When you are owning the office then it can offer various advantages like you can rent out the extra office space and this would be your extra source of income.
Retirement Savings: When you are owning the commercial space then it would be appreciated with time and you can sell it out and get the funds for your retirement.
Cons of Buying Office Spaces
Lack of flexibility: Growing business would experience many unexpected needs in the future. When the business is growing continuously then your owned office space sometimes becomes inadequate and you are forced to sell the property.
Upfront Costs: When you are buying the commercial space then initially the cost is more upfront. There are appraisal, property maintenance costs, larger down payments, and various other property improvement costs.
Pros of Leasing Office Space
Prime Property: You will get the property in prime locations. You will also get the space option required for your business. When your business is into a restaurant or retail which is dependent on the location then the leasing option is more affordable.
Free up working capital: The money is not tied up in real estate. You would be able to respond to various opportunities in the market. The ability of borrowing funds is not limited to buying office space.
More Time: There are various headaches with ownership. When you are leasing an office then you can solely focus on running your business.