Delving into the world of commercial property investment can be very profitable, especially to those who want to expand their financing resources. And then the questions, how pricey can a commercial property get and when is it okay to pay more than what one decided? Well, both questions can be answered with just one fact: land appreciates and buildings depreciate.

To those not in the know, a commercial property with a good land but faulty infrastructure is a concrete example of a viable time to pay more than the budget. However, there are some things that need to be considered first- the location, the position and the area. Location wise, try to check if it’s accessible enough. In the positioning, check if what kind of market it would be more suitable to fit into. And finally, the area. Check the extent of the land property and determine how its size is categorized.  

Putting things in perspective, lands are always going to be there and people will always want to get their hands on them, be it big or small – so long as the land fits their area preference. It will serve its purpose.

Buildings, on the other hand, they fall down. They will always fall apart or can get swiped out or get changed. No matter how sleek its maintenance can be, it may still be subjected to the decision of the owner whether or not they would keep it, renovate it or demolish it.

In retrospect, land will always find its way in bringing up its value while buildings may hold their value but are bound to fall overtime and when they do, they lose their value. In reality, it’s not really about paying too much. It could be paying beyond one’s budget but it’s actually more on paying the commercial property rightfully for its land value.