Canadian Money Forum banner

1 - 9 of 9 Posts

·
Banned
Joined
·
1 Posts
Discussion Starter #1
I'm looking to purchase a rental property ( or a couple) Just wondering if there are big advantages/disadvantages to purchasing the property under my name versus a business name?
 

·
Registered
Joined
·
6,866 Posts
If you are taking a mortgage, then putting it in your name will make it easier, unless the business has a track record.
 

·
Banned
Joined
·
429 Posts
I think I've written about this before.

Even with a business mortgage, it's going to have to be personally guaranteed, unless you have enough capital from the business side of things.

In general, business has higher loan rates, and more reporting difficulties. However, the benefits are lower tax on profits, ability to defer, and a reduction in legal liability. Also, it's easier to structure further purchases off a business (in general).
 

·
Banned
Joined
·
688 Posts
My business just qualified for a mortgage as we want to buy a building rather than leasing for the next 20 years. We have a very profitable business and three years of solid growth. They still want to see 30% down which is fine as we have been saving for this purpose.

The thing that I find incredible is the price of commercial real estate. A crappy old house converted to offices with commercial zoning is worth close to double what it would be if just zoned residential.
 

·
Banned
Joined
·
429 Posts
Really? I find that commercial property values are actually lower, due to higher commercial taxes for the same property. i.e. in our work, live, loft, the commercial property values are 20% less than a similar size property that is deemed to be residential.
 

·
Registered
Joined
·
2,054 Posts
I also agree with Genius boy

Commercial space, industrial space and mixed use commercial buildings are cheaper compared to houses in the area.

Interest rates are higher. Taxes are higher. Once you get past the million $ mark (not all the time sometimes lower) prices become linked to income.
 
1 - 9 of 9 Posts
Top