What Are Commercial Real Estate Properties?

What Are Commercial Real Estate Properties?


If you are thinking about making an investment in real estate, or are just looking for a new primary residence, it is important to make the distinction between commercial and residential real estate. Understanding whether a property in question is commercial or not can have implications in terms of taxes and zoning codes. The best time to ask this question is before you buy, however, if you have a property and are wondering about its classification, there are a few ways to determine into which category it falls.

In the broadest terms, commercial real estate is any property that is purchased to help generate an income. This includes those buildings that will be rented out as office space, or large multi-unit dwellings. For those who are interested in purchasing commercial real estate, the best course of action is to seek out a commercial real estate firm. This way, you will know that your broker understands the pricing and taxes to which commercial real estate is subject.

Residential, or non-commercial real estate, is usually confined to homes, particularly those that are meant as dwelling places. In plain terms, your home and any vacation homes would be considered residential or non-commercial real estate. In many cases, even small apartment buildings, with just a few units, still fall into the category of residential real estate. There are a number of experienced brokers who specialize in residential real estate. In addition, it is possible to find homes that are for sale by owner in this listing.

Because real estate transactions can be tricky from a legal and financial standpoint, it is generally advised that buyers enlist the help of experienced professionals. If you are hoping to buy and renovate a property, either for personal use or commercial interest, share this information with your broker as you begin your search. That way, you can be sure that any changes that you hope to make will be allowable within local zoning codes.
 
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