{"id":6582,"date":"2015-12-10T01:00:23","date_gmt":"2015-12-09T14:00:23","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=6582"},"modified":"2015-12-10T01:00:23","modified_gmt":"2015-12-09T14:00:23","slug":"residential-vs-commercial","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/residential-vs-commercial\/","title":{"rendered":"Residential vs Commercial &#8211; Jan Somers"},"content":{"rendered":"<p>&nbsp;<br \/>\nIn today&#8217;s show\u00a0<strong>Jan Somers, <\/strong>the author of the book \u201cMore Wealth\u201d,\u00a0details her reasons for advising investors to look first at investing in residential property and not commercial property and she has a one word reason.<br \/>\n&nbsp;<\/p>\n<h4>Transcript:<\/h4>\n<p><b>Kevin<\/b>:\u00a0 Inside Jan Somers\u2019 book \u201cMore Wealth,\u201d chapter eight actually deals with a very interesting subject, and it\u2019s a question we get asked from time to time: why should investors choose residential property rather than commercial property?<br \/>\nThe author of that book joins me. Jan Somers, hello. How are you?<br \/>\n<b>Jan<\/b>:\u00a0 Hello, Kevin. How are you?<br \/>\n<b>Kevin<\/b>:\u00a0 Fantastic. Thank you, Jan.<br \/>\nNow, the reasons behind that?<br \/>\n<b>Jan<\/b>:\u00a0 Well, there\u2019s probably just one word and that\u2019s called risk.<br \/>\n<b>Kevin<\/b>:\u00a0 Yes.<br \/>\n<b>Jan<\/b>:\u00a0 Risk, just like the insurance ad, things become risky and they\u2019re not worth doing. Now, it doesn\u2019t mean to say you can\u2019t make money out of investing in commercial property, but in my experience and my observations, it\u2019s a lit bit hitandmiss \u2013 not a little bit, very much hit and miss.<br \/>\n<b>Kevin<\/b>:\u00a0 Do you need a different mindset for it, Jan?<br \/>\n<b>Jan<\/b>:\u00a0 Yes, you need a personality that can cope with the ups and downs of a commercial market.<br \/>\n<b>Kevin<\/b>:\u00a0 Yes. Because unless you get that tenant and property mix right, you can have some pretty long vacancy periods, can\u2019t you?<br \/>\n<b>Jan<\/b>:\u00a0 Very long vacancies. In fact, I can pinpoint back in 1992 when I was traveling a lot and back and forwards to Brisbane and Sydney and Melbourne. I don\u2019t think I\u2019ve ever seen so many vacancy signs in my whole life. In fact, I was virtually paying people to come and rent their commercial premises in Melbourne.<br \/>\n<b>Kevin<\/b>:\u00a0 When you have to cut deals in commercial, as well, because you go into such long leases, these deals can really drag their heels for you for quite a number of years. It also impacts the value of the property, as well, Jan.<br \/>\n<b>Jan<\/b>:\u00a0 Well, exactly, because the value of a commercial property is based on its actual lease, so if you have a property that\u2019s vacant for a long period of time, that certainly isn\u2019t worth very much as far as the value of that property.<br \/>\n<b>Kevin<\/b>:\u00a0 Is it wise, do you think, Jan, to have a balanced mix, or do you think it\u2019s either one or the other?<br \/>\n<b>Jan<\/b>:\u00a0 I tend to go for one or the other. I would probably put some even holiday units and apartments verging on that commercial rental frame, because it\u2019s very much up and down, too, and depends very much on the economy. It doesn\u2019t matter whether the economy is up or down; people need somewhere to live, but they don\u2019t necessarily have a place to go to work.<br \/>\n<b>Kevin<\/b>:\u00a0 Yes.<br \/>\n<b>Jan<\/b>:\u00a0 I tend to stick to residential. I would have to admit, whenever I ventured any further, I can\u2019t say exactly I\u2019ve got my fingers burned, but then the pie hasn\u2019t grown, either.<br \/>\n<b>Kevin<\/b>:\u00a0 Yes. Is there a better time to be looking at commercial rather than any other time, or does it depend on the marketplace?<br \/>\n<b>Jan<\/b>:\u00a0 Yes and yes. There is a better time, and it does depend on the marketplace; but I don\u2019t know when that time is, and I doubt that anyone knows when that time is. I guess the time to buy is when the prices are down, and that\u2019s when no one is renting.<br \/>\nIf you could have bought those properties that I saw vacant in Melbourne back in 1992 and held on to them for a few years, you would have made significant gains. But, of course, no one wants to buy when the place is vacant, and of course, that\u2019s the time to buy because the value of the property has been deflated so significantly.<br \/>\n<b>Kevin<\/b>:\u00a0 I wonder how many people actually are in business and decide that it would be a good idea to buy their premises, and it probably is for that reason.<br \/>\n<b>Jan<\/b>:\u00a0 I think it is. I think it is. It\u2019s probably about the only time that it is a good time to buy property \u2013 when you have a business and you\u2019re the owner of that premise, because you get control over it. You don\u2019t get told what to do, what you can do, what the rent is.<br \/>\nPeople who do own their own land and buildings, when they have a business, it\u2019s probably one of the few times I\u2019d recommend that you do own commercial property.<br \/>\n<b>Kevin<\/b>:\u00a0 Indeed. It\u2019s a great read. It\u2019s called \u201cMore Wealth.\u201d It covers a whole multitude of topics, and you can access that book by going to Jan\u2019s website, somersoft.com.<br \/>\nJan, always a pleasure talking to you. Thanks for your time.<br \/>\n<b>Jan<\/b>:\u00a0 My pleasure, Kevin.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&nbsp; In today&#8217;s show\u00a0Jan Somers, the author of the book \u201cMore Wealth\u201d,\u00a0details her reasons for advising investors to look first at investing in residential property and not commercial property and she has a one word reason. &nbsp; Transcript: Kevin:\u00a0 Inside Jan Somers\u2019 book \u201cMore Wealth,\u201d&#8230;<\/p>\n","protected":false},"author":176692471,"featured_media":6583,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[10,11,13,17,18,25],"tags":[101],"class_list":["post-6582","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-kevin-turner-sponsored-channels","category-kevin-update","category-latest-story","category-property-investment","category-property-management-topic","category-sponsored-channels","tag-podcast"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Residential vs Commercial - Jan Somers - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/residential-vs-commercial\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Residential vs Commercial - Jan Somers - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"&nbsp; In today&#8217;s show\u00a0Jan Somers, the author of the book \u201cMore Wealth\u201d,\u00a0details her reasons for advising investors to look first at investing in residential property and not commercial property and she has a one word reason. &nbsp; Transcript: Kevin:\u00a0 Inside Jan Somers\u2019 book \u201cMore Wealth,\u201d...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/channels.realty.com.au\/realtytalk\/residential-vs-commercial\/\" \/>\n<meta property=\"og:site_name\" content=\"Realty Talk\" \/>\n<meta property=\"article:published_time\" content=\"2015-12-09T14:00:23+00:00\" \/>\n<meta name=\"author\" content=\"rolanrush\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rolanrush\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/residential-vs-commercial\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/residential-vs-commercial\\\/\"},\"author\":{\"name\":\"rolanrush\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/384a57ac9e52cb9bf19896cb15eaa52d\"},\"headline\":\"Residential vs Commercial &#8211; 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