Imagine that you're planning on opening a salon and spa. Edmonton or possibly Saskatoon are your ideal locations. You've got your business plan ready and your funding secured. Now it's time to look for office space. Once you find it, the question becomes: should you buy it, or should you lease it? To help you make your decision, we'll list the pros and cons of each way of doing things so you can see what would be best for you and your business.
Buying: Pros
The advantages of buying office space are the same as upgrading your rented apartment to a house from Royal Lepage Windsor: your payments are actually leading to something. When you buy, once your mortgage is paid off you own the property, while leasing leaves you paying endlessly. You'll also have a lot more freedom to do renovations and make changes to the interior and exterior of the property if you are the owner. Plus there's the added advantage of having your rate negotiated beforehand and not being at the mercy of landlord rent increases.
Buying: Cons
Buying office space is tremendously expensive, especially if you're hoping to buy into a popular location. You'll have to have a long consultation with your mortgage brokers in Toronto to see if you can afford it, and what's more, whether your business will be able to support it. There's also the chance that after buying your business grows or shrinks and then the office space is no longer suitable, which means you either have to make do or go through the whole rigmarole all over again. On top of running your business, you'll also be responsible for maintaining the property.
Leasing: Pros
Leasing is the most flexible option, which makes it the best one for new businesses than can change a lot in the early days. If in a few months you find that your Canadian resume service has outgrown its offices, you can cancel your lease move to another office with a minimum of hassle. You can also focus all your energy on growing your business, as the building owner will be responsible for maintenance. And if the worst happens and your business folds, you won't be stuck trying to unload the office space.
Leasing: Cons
As a long term solution, leasing is not as economical since you will continue to make payments but title will never transfer to you. Leases are tenuous things that can be broken by the landlord as easily as you. This could cause some trouble for you if you've just spent a lot of money outfitting the space into a clinic for naturopathy. Toronto's popularity is high, so you can expect your rents to go up as well.
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