Most daycare centers aim to have their own property that they can have as their own. They have dreams of owning their own building so that they will have less cost in running their business. Owning you own real estate also provides you with total control over the place. But because of some factors, businesses do end up continuing lease rather than buying the property.
The decision to just lease their centers has been the most popular choice made by the owners. After some time of running the business, they end up with the decision that they are financially unable to pay for the ownership of their property. Here’s the difference:
1. What makes the daycare owners decide on leasing their property is the lesser payment that they will make in renting the place. If an owner decides to pay for ownership of a certain building, they will shell out a minimum of $1,000,000 for the construction, land, franchise and equipment costs. Compared with leasing the same property, they will only need to shell out half of this amount for the franchise, capital and equipment costs. If you are a business owner, it is more likely that you will choose the second option.
2. For the advantage of your daycare business, financial advisers will actually advise you to own your business property rather than renting it. This will not be so much of a hassle for you and the owner of the building because all you need to do is to come up with a fair agreement that will benefit both of you so that it will be easier to own the property.
3. There are so many things which you can get if you own your own property. The list can go on and on this is why it is better to own your building rather than paying lease monthly. You will be able to earn more money through property appreciation. You can eventually sell the building or even have it rented by other businesses. As with paying lease, your mortgages are reduced so you will also lessen the costs that you will have to pay.
4. What makes buying the building so convenient is the ease of paying your property. If you have already rented the place for quite some time, you can now make the decision to buy the property. Offer a selling price which will have you attribute your rent with the price that can cover your down payment. The value on appraisal has always been higher than the purchase price. Usually, if the property was appraised, you can minus the total rent and with the 15% down payment which will only cost you half the price compared to when you pay out the 15% from the selling price without having to deduct the rent.
Choosing to own the property can really help you in your business. This actually reduces your cost. Do not be afraid to learn about principles in leasing to own property because it can only cause you to financially benefit for your daycare center.
For more:
How to start a daycare business by OwnADaycare.com
