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Leasing vs Buying
 
The Question
 
The question is being asked more than ever before: should my business lease space or purchase our own building? This is not an easy choice as there is no simple answer. The truth is there are advantages and disadvantages to both and a number of factors must be weighed while making this decision. Listed below are the primary factors that should be taken into account while making this important decision.
 
  Lease:   Buy:
 
Longevity: Start-up companies or those that are likely to relocate within the next 10 years should lean towards the flexibility of leasing space.
 
Flexibility: Leasing space may provide a business with more flexibility as office space needs change.
 
Responsibility: Business owners should take into account the added responsibility that comes with owning a building. Leasing space allows an owner to focus more attention on their company’s performance instead of utilities, repairs, and remodeling.
 
 
Longevity: If your company is established and plans to keep your business in one location for at least 10 years, then purchasing your own building may be the smart choice. For a growing company, it may be wise to purchase a larger building and sublease any excess space that could be expanded into in the future.
 
Building Requirements: If your business location has a number of unique requirements, constructing your own building could be a wise investment as opposed to the high cost of reconfiguring leased space.
 
Tax Advantages: Purchasing your own building will result in more fixed expenses and overhead costs, as well as a number of tax advantages. See your tax advisor about your specific tax situation.
 
       


 
 
 
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