Is it even worth considering commercial with a $180,000 deposit in the current market?

Hi All,

I've got a deposit of $180,000 + change and was considering putting it towards a commercial property but factoring in the 30% deposit requirement + costs, is it enough to secure a decent asset in today's market? From my research, it appears to be increasingly difficult to find a quality sub-million commercial property.

Perhaps a better play would be to go residential with focus on CG and consider commercial in a few years?. As it stands, I'm in my mid-30's with 2 IPs (fixed for the next three years) and a PPOR (variable, from which I'm releasing the $180,000 in equity).

Any feedback would be much appreciated!

Z.

 

Depends which part of Australia.

You could look at mixed use properties where you could get resi loan and resi LVR. This could be shop top housing or buying a small unit complex. Again depends which part of Australia.

Sydney? Fuggedaboutit.

 

I purchased a commercial, one of two offices/retail on ground floor of an apartment building.
Listed as unit 19 (of 19), I never said it wasn't resi and the bank never asked
So ended up at 10% deposit

 

Surely you could find some retail space for circa $500k, especially out of the 2 big cities. You'd just need to find one with a good tenant/fundamentals

 

Nice, had a similar outcome with serviced apartment a few years back using a desktop valuation.

 

Depends on what type of Commercial you are buying...Retail properties are record low in some states due to Covid, meanwhile, the Industrial properties market are growing crazy, just make sure you have the capability to afford the mortgage when the property is vacant, as Commercial properties take longer to secure a tenant, sometimes it can be vacant for 6 months or more

Just my opinion, hope this helps

 

I have a retail/office for sale currently (outer Sydney suburb)
Have had lots interest from owner occupiers
When I bought I paid less than a 1br apartment in the complex, rejected an offer this week that was the same as a recent 2br sale price
Larger offices may be struggling price wise but there's LOTS of consumer confidence out there currently

 

Good work mate! City Fringe offices are going down but suburban areas are other way around....most people are sick of working from home and want a small office space to work and have some personal time instead of being home 24/7 - Good luck with the SALE!!