Residential or Commercial - Which real estate give you more returns?

Discussion in 'Dubai property' started by Harish, Jul 12, 2018.

  1. Harish

    Harish New Member

    I know that both have some unique features. But unable to decide which is better? Can anyone tell me which is best for good returns
    Last edited: Jul 12, 2018
  2. realdeals

    realdeals Active Member

    Residential property tends to perform better in the long term in my experience simply because the worldwide population is growing and demand for residential property is following. However, there are many different caveats such as the area, type of property, prospects for the region, local economy, etc.
  3. FWL

    FWL Member

    My main concern with commercial property is that very often the property will be set up for a particular business and if that business suffers or moves then you may well have significant renovation costs. Also, with the amount of businesses going online today this means that commercial assets on the high street have significantly reduced in value of late.
  4. Ganesh Dasari

    Ganesh Dasari New Member

    Hi Guys,

    Real estate market for both these categories is different. There are various factors which need to be considered when you are planning to invest in a residential or commercial project. I would suggest to do proper homework before making such a decision or hire a agent who can help to get the data for better decision making.

    Thanks & Regards
    Rahul More
  5. NehaS

    NehaS New Member

    Yes, I agree with Rahul More. You should hire an agent but before hiring him make sure that person is trustworthy and has a very good reputation in the market.
  6. diyhelp

    diyhelp Active Member

    The problem today is that if you are looking at commercial premises, for example a shop, the Internet has made such an impact on online buying that the value of shops will have fallen in many parts of the world. There will obviously be the option to redevelop into flats, etc but this is not always as straightforward as you might think and there are obvious costs.
  7. Sonalia

    Sonalia New Member

    Higher returns and cash flow is arguably the biggest benefit of a commercial real estate investment over a residential one. Residential loans are typically paid off over 30 years while commercial loans are typically paid off over five to 20 years.
  8. realdeals

    realdeals Active Member

    My approach would be to create a backbone of solid rental income - even if the potential capital growth was limited - which would allow you to pay off the mortgage much quicker. Then maybe use excess funds going forward to take a calculated risk on property where the focus is more on capital gains than rental income. You need a solid backbone and a solid income stream for long term success.
  9. Vaidehi Khandare

    Vaidehi Khandare New Member

    Well i would suggest you to go with commercial properties.
  10. FWL

    FWL Member

    It all depends on your long term goals - personally I think in the current market, commerical property carries the higher risk in the UK. There is nowhere near enough private rental accommodation in the UK which has pushed rental yields higher.

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