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Start a Business

Buying vs Renting: What is the best option for your business premises?

Have you just set up a business and need somewhere as a base? Perhaps your lease has ended on
your old premises and you’re trying to determine whether you should buy or rent your next place.
Whatever your reason for finding a new building for your business it can be a difficult task. Your
budget will play a large part in deciding which option is viable, so being in control of your finances
before making a choice is a good idea. The truth is, there is no right or wrong answer as it’s all about
what’s right for your business. So, if you need some help deciding which option is best for you, look
no further.


If you buy a property in an upcoming area, then there is potential for appreciation in value. When you come to upsize, downsize, or sell up in the future your building may be worth more than you paid for, giving you more capital for your next purchase.

If you buy a premise that is on the larger side, you could sublet parts of the building to gain more revenue. If there is a demand for workspace around your chosen area, you will be able to charge competitive prices and be picky about your tenants.

If your business requires specialist equipment or heavy machinery, they can often be difficult and expensive to move. So, owning your premises means you are in control of when you move, rather
than a landlord having the final say.


One of the main advantages of renting is a lack of responsibility. If something happens to your
building that is out of your control, it is your landlord’s responsibility to fix it. Whereas owning a
property would mean you have to find the cash to solve the problem.

Renting gives you more control over your cash flow. Mortgage payments can often be affected by interest rate rises whereas rent tends to stay consistent. Also, with other payments such as utility bills, having a fixed monthly/yearly payment is beneficial.

When buying a premises, you need a lot of capital, to begin with. Also, you might have to take out a commercial mortgage which could affect your ability to borrow capital for other projects.

Buying a property means you are tying up capital that could get used in other areas of your business
development. Renting frees up capital to allow you to continuously grow your business, buy new
equipment or hire more staff. So, if your business is in a period of growth, rentals might be your best


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