Urban Trendy Entrepreneurial and Smart

Working from Home Can Be a Joy

Acquiring an Workplace Condo: 
A Excellent Option for Many

Financing

Even though getting a workplace apartment can be expensive, it is usually a better option economically than renting an office space and assuming additional overhead. Financing a your principal residence and using it as a home office is a win win because of tax advantages. With the rise in short sales and foreclosures we have seen the return of 203k Loans. These loans allow for financing to be used to cover improvement expenses and settlement expenses.   In an earlier post we have referenced the benefits of these type of loans. Read….

This type of financing makes it possible to receive monies to help with some closing cost as well as get financing to renovate and upgrade the property you are purchasing. Essentially when you set up a home office you get your business to pay you rent and thereby increase your financial position in the positive month after month and year after year.

Monthly Costs

Purchasing really is advantageous in these instances because the per month home mortgage ends up less expensive than the price of renting. As well, if you have a fixed-rate mortgage, your per month mortgage outlay is consistent, whereas with renting there is always the possibility of rental increases over a 6 month or annual basis.

When renting, you are subject to market changes, cost of living increases and the management company passing on their ever increasing cost in maintaining the rental property. All these expenses are passed on to the renter and are deemed as justifiable rental increases. Many rent with the idea that it excuses them from any responsibilities to the home. Always free to call the landlord and/or rental management company. Check the fine print. In many cases the renter is responsible for some plumbing issues, lawn and shrub maintenance and minor mechanical issues that arise.

How can one avoid these SURPRISE FEES?  A fixed-rate mortgage, amortized over thirty years which will be lower than most rents and has numerous tax advantages. What are the advantages?

Tax advantage

Let us enumerate them and then allow you to do some additional research.

1. Mortgage Interest can be deducted. Check with your financial adviser as to the extent to which you can do this, in most instances it is a 100% write off.
2. Maintenance can be deducted. The amount of space that is written off in the home is a match to the amount you can claim in deductions of various fees, such as but not limited to maintenance, lawn care,  electrical usage and the list goes on. Your financial adviser will give you additional details that match your particular portfolio.
3. Renovations  can be deducted. How do the renovations affect your office space, the ability for you to do business and your clienteles greater use of the office are all items that are taken into consideration.
4. Tax Depreciation. Again consult your financial adviser and/or tax accountant.

Long Term Benefits

Luxury Condos allow you to Work Live and Be Happy

Thus far in this post we have discussed the immediate benefits that come with having a mortgage. Not to mention the additional write offs that come with running your business out of your principal place of residence. But there are long term advantages that have not yet been discussed and/or considered. What are they and are these immediate or do they take additional work? The answers are YES and NO. How so you ask?

1. Increase in equity. The market today is stable. Not a word that we have heard frequently in concert with real estate over the last 5 years. However it now exists in our market. Homes are not realizing unrealistic 30% to 50% increases month over month. The increases now make sense, the normal 3% to 5% over 4 to 6 month period. Incremental and steady. Homes that are purchased under market that need work offer a larger potential for gain. Again consider a 203k loan a fantastic choice for today.
2. Your property could ultimately be a better pension/401k/retirement plan than any that are offered by your existing employer. If you are banking on Social Security and under the age of 55, forget about it! Call us today if that is your retirement plan.
3. The opportunity to create a wealth portfolio of rental properties. The pathway to rental properties is start with the first purchase of your principal place of residence. Buy what you can afford and make improvements. As your needs grow move on and make your home a rental. Ask any real estate millionaires, nine times out of ten this is how they began. What are you waiting for?

Get Educated

What type of business are you going to run? Will you have clients coming and going? How much space will you need? Is the area conducive to your conducting this type of business? Will there be local clientele that you can pull from? These are important questions that need to be explored as you begin your journey in finding a home that is suitable to run your business. If you are considering a condo, since that is what is being discussed, it might be best to look at the By Laws that govern the association you would ultimately become a part of. 

So many person say "Give Me an Example of this type of Property". We are exploring Urban Trendy Upscale Condos. Often these attract a community that has a strong appreciation for art. This might a perfect venue for someone looking to run an art studio of gorgeous originals. Many times it may be highly acceptable to the Condo Association because of the audience they seek in potential home buyers and/or renters. Asking if there is a possibility to purchase joint condos with the idea of expansion is a great question and makes perfect sense. The need for versatility when running an in home business is huge and designing according to your needs and specifications a must. But I can't stress how important it is to work with an agent who has this expertise and is not afraid to go the extra mile for their client. Don’t be afraid to ASK and work with a Realtor who understands your needs and respects your wishes. ASK ASK ASK!!!

Buying is the BEST option for entrepreneurs who are dedicated to seeing their businesses be successful and turn profits back into building their business. Want to discuss this option further or better yet see some properties that can allow for an in home business?

Click on Urban Upscale Condos.

*PS these pics in today's post are from a work live condo I am about to list....if your interested in getting in early let me know!

Inviting Bistro Areas--Double As A Client Waiting Area