As you may not know, Singapore is ranked to be the 2nd best in the world when it comes to returns on investments. Whether you should lease or buy an office space, you should do the research ahead of time on the choices you have while considering your long term plan for your business.
A business that plans to expand in terms of employees and space may consider leasing an office space as buying one could mean more costs and hassle when it comes to selling.
Advantages of buying office space
Being aware of the advantages and disadvantages of buying office space can help make you make an informed decision for your business. Here are a few advantages of buying office space:
You’re in control
Since you own the office space, you are in full control. There are no surprise costs or fee’s so you know what to expect for your own office space.
Renting out for additional income
You’re able to rent out your office space for additional income if you wanted to. Being a landlord means you have the power to rent out your space.
Demand is always there
With Singapore’s limited land, there is always someone looking to rent out or buy office space. So you can be sure that you can always sell your space when you don’t need it, depending on the location of course.
Tip: Always ascertain that the space on lease can indeed be used for purpose of office use. Check out this website for guidelines for approved use of commercial buildings in Singapore.
Disadvantages of buying office space
You need time to manage your space, and you have to maintain it in order to keep it running the way you would like it to.
If something happens to the property, damage or something like that, you have the responsibility to repair it before more accidents happen.
More cash upfront
Buying office space means you have to pay for the full price of the space. If you’re leasing, you would only have to make small payments or a deposit. You need more capital if you’re buying a office space in Singapore.
Leasing an office space
There are many advantages to leasing as you don’t have to commit to buying it. With leasing, you can always expand into a bigger space, whether there is more space in the same building, or if you would change to a different office space.
The rates are negotiable: depending on the availability of the office spaces in the area, the rate can easily be negotiable as the supply is all over the place.
Fewer responsibilities: without buying the property, there is no need to maintain the office space as you would if you bought it.
If you have a small business, it is surely a good idea to lease unless you’re absolutely sure of your long term plan. Keep in mind that you should always be proactive and prepared for any changes if your needs for the office changes.