Owning Your Business Premises Proves Its Worth In Uncertain Times

For years, there’s been a big debate on whether or not you should own your business premises. This can be an office, retail outlet, warehouse; wherever you do business. The common tendency is to rent these places as it seems cheaper in the short-term. Raising funds to buy a place of work can be hard for a lot of small businesses. However, it could present some long-term benefits for your company. 

We’re not going to weigh up the pros and cons of owning your business premises in this article. That debate has raged on before, so you can find similar articles online. Instead, we’re looking at how owning your premises may have proved its worth during uncertain times. 2020 is a challenging year for SMEs –  but could owning your workplace put you in a more advantageous position? Obviously, if you rent, you can’t turn back time and change your approach. Still, you can take this as a lesson to learn for the future. 

Without further ado, let’s see how owning your business premises will help during difficult times:

No money goes to waste

During uncertain periods, you will waste a lot of money on rent. Think back to earlier in the year when you had to close your place of work. Unless you operated an essential business, you had to work from home. Here, you paid rent for absolutely no reason at all. The landlords still had to collect money because they needed to earn it somehow. But, you pay rent and see absolutely nothing in return. Sure, it might be decreased because you don’t use any energy, but you’re paying for an unoccupied building. 

By contrast, you don’t waste any money when you own the building. In perfect scenarios, you will buy the building and pay it all off. If this applies to you, there are zero costs coming out of your bank when nobody is in the building. Of course, most businesses will still be paying off their mortgage on the property. The amount you pay each month will depend on your mortgage calculation, and it could be higher than some people’s rent. The difference is that this money isn’t going to waste. You’re paying towards your mortgage, taking one step closer to repaying the loan. Instead of the money going into someone else’s pocket, it goes towards covering the entire cost of the property.

Does this make sense? By not owning the property, you pay rent that benefits someone else. If you own it, the money you pay will benefit you by helping you pay off your mortgage loan. 

Nothing to worry about

Secondly, we can say that owning your business property gives you nothing to worry about. During uncertain times, businesses aren’t the only things affected by a dip in the economy. Landlords will be in a similar position, if not worse. Therefore, you have no idea what will happen to your tenancy. What if the building owner is going through financial turmoil due to the uncertain times? They might struggle to make as much money as they used to, leading to some difficult decisions. In turn, this makes them sell some of their assets – including your building. 

Consequently, you might have to vacate the building and find a new place to work. They could sell it to someone else who doesn’t want to use the building for the same purpose. Or, the new landlord may charge a higher rate than the old one. You don’t know what could happen, so there’s an air of uncertainty hanging around. For all you know, your business could be thrown out onto the street!

If you own your premises, you have nothing to worry about from this perspective. As the owner, you are in control of what happens. There’s no fear of being evicted or the building being sold. If you do fall on tough financial times, you have a building to sell! The bottom line is that you are in control of your own fate. By renting, you leave your life in the hands of others. All it takes is for your landlord to fall on harsh times, and you could be left with no business location. 

To summarize, owning your business premises can help you feel more secure in uncertain times. As mentioned in the beginning, this won’t change anything if you’ve been renting throughout 2020. You can’t alter the past, but you can shape a brighter future. Now you know the benefits of owning a building, it might tempt you to take the next step. 

 

 

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