1. Lease or Buy: Carefully Consider the
Pros and Cons

2. Retail businesses require specific
features such as foot traffic,
adequate parking and ample
interior space to showcase
goods, but whether to lease or buy is a complex
issue for business owners. Below are some pros
and cons of leasing and buying.

3. Leasing
Pros: Your credit rating will be less important.
And this is of particular benefit to newer
businesses with limited credit histories.
Rent can also be used
as a tax deduction, and
business owners can sublet
or move at the end of the
lease term.

4. • Cons: You won’t build equity on the property.
There is less security; your lease may not be
renewed or your rent may be upped
substantially. You remain responsible for the
rent until the end of the lease term.

5. Buying
Pros: Mortgage interest is tax deductible
and your accountant can
use annual depreciation
on the building as an additional
deduction. Owners can alter the
building to their specifications.
There is greater security; owners
don’t have to worry about rent
increases and can lease unused space
for additional income. The property can
be sold at any time.

6. Cons: Ownership requires a substantial initial
capital investment to acquire financing.
Property values may decline, and the owner is
subject to legal liabilities associated with the
property. Owners may also have to invest
additional time and energy that isn’t part of the
day-to-day operation of the business.

7. Randy Bett
www.BetterGroupRealEstate.ca