Let’s face it: you can only work out of your home for so long. At some point, you’ll begin to recognize (if it hasn’t happened already) the need for a separate space. But with that comes a tricky question: should you buy or lease your office space? There are pros and cons to both situations, and one answer isn’t right or best for every person. So let’s take a look at the facts.
Pros Of Leasing Office Space:
Less Commitment
When you’re just starting out with your business, it can be difficult to predict the exact size you’ll need for the foreseeable future. Leasing a space is less permanent, so it’s much easier to move out and find a new space as needed.
Tax-deductible
When you lease your office space, you can claim it as a deductible in your taxes. Need I say more?
Landlords Are Usually Flexible
If you have any requests or need need to remodel, most landlords are willing to work with you. And you won’t have to make those changes out of your own pocket!
Cons Of Leasing Office Space:
Landlord Makes The Rules
While landlords are usually willing to work with you, it’s still their rules you’ve got to stick with. So while you might have less commitment, you might also have less freedom if you lease.
Prices May Vary
It’s pretty common for rent to increase once your lease expires. When you lease your space, you can’t always count on consistency.
Unpredictable Changes
When you need to make changes or fix damages, you have to wait for it to fit in your landlord’s schedule.
Pros Of Buying Office Space:
Set Mortgage Payment
No matter what happens, you can count on your mortgage staying consistent. So if your space rises in its value, that’s all yours in the long run.
You Can Make Changes As You Like
…and when you like (within ordinance codes.) You get to make all the decisions for the space and make it completely your own.
You Can Lease Out The Space
If you have extra space, you can rent it out and add to your revenue.
Cons Of Buying Office Space:
Growing Out Of Your Space
If you do end up growing out of your space, getting out of it can be a lot more difficult than getting out of a lease. You’d have to sell the property, which can cost you real estate fees.
You Pay The Expenses
Owning a space can be a total money pit. You’re responsible for paying maintenance fees, remodeling and repairs.
Initial Expenditures
Starting off the process of you owning office space can be expensive. You have to pay real estate fees, closing fees and more.
While there might not be one right answer, it’s up to you to determine what the best choice is for you, your team and the future of your business.
by: Emily Brady
Emily Brady received her Bachelors at Brigham Young University Idaho where she majored in Communication Sciences with an emphasis in journalism and professional management. She has written for Scroll News and Deseret Digital Media and is currently a freelance writer. In her free time she enjoys hiking, reading and swinging in her hammock.
