Leasing vs. Buying: What's the Best Option for Retail Space in Pune?

Pune has always been a residential and commercial hotspot for homebuyers, businessmen and smart investors. Having said that, we can not deny the fact that the demand for a shop on rent in Pune, and a shop for sale in Pune has grown manifold in the past decade or two. Much of the credit for the ever growing demand for a shop on rent in Pune, and a shop for sale in Pune goes to the emergence of Pune as an IT hub, and the growing number of people migrating to Pune from different parts of the country. Pune offers a world of opportunities for businesses, especially for retailers who wish to cash in on the number of footfalls, cosmopolitan crows, and the growing spending capacity of their prospective customers. But one major question everyone faces at the initial stages when looking for a commercial property in Pune is whether one should look for a shop on rent in Pune, or a shop for sale in Pune. Well, this is a tough decision to make as it depends on several factors such as your business's goals, financial situation, and long-term vision. In this blog, we will explore the pros and cons of leasing and buying retail space in Pune, which will help you come to a fruitful conclusion and decide whether you should look for a shop on rent in Pune or a shop for sale in Pune. Read on! 

Let’s first take a look at what happens if you decide to go for a shop on rent in Pune. 

The Pros of Choosing a shop on rent in Pune 

1. A shop on rent in Pune will offer you the advantage of lower initial costs 

As compared to a shop for sale in Pune, leasing it will need a lower upfront investment. This works for businesses who wish to preserve their capital and utilise it to fulfil other requirements such as inventory, marketing, staffing, office equipment, etc. 

2. Enjoy flexibility with a shop on rent in Pune

When you choose a shop on rent in Pune, you could go for a short-term lease, which typically ranges from 1 to 5 years. You could then enjoy the advantage of flexibility and adapt to transforming market conditions or even explore a new location and look for a suitable shop on rent in Pune. 

3. A shop on rent in Pune keeps you away from maintenance responsibilities 

When you take up a shop on rent in Pune, you won’t have to worry about its maintenance, as this responsibility is typically shouldered by the developer. 

4. Access to prime locations made easy 

If you think that owning a shop for sale in Pune, in its prime locations is out of your reach, you could then opt for a shop on rent in Pune’s upmarket locations. This will add less burden on your finances and offer you access to your desired target group.

5. Tax Benefits

Lease payments for a shop on rent in Pune are tax-deductible business expenses. 

Cons of choosing a shop on rent in Pune 

1. A shop on rent in Pune won’t build you any equity 

Since your lease payments will contribute to the builder’s or landlord’s equity, you will have no gains from it. 

2. Limited Control is one of the disadvantages of going for a shop on rent in Pune

If you wish to go for renovations and modifications, you will require your landlord’s approval. This will be a barrier if you plan on creating a unique retail experience.  

3. Rent Appreciation 

Lease agreements often include rent escalation clauses that allow landlords to increase the rent annually. 

Now, let’s take a look at the advantages of going to a shop for sale in Pune 

1. Appreciating asset - one of the major advantages of choosing a shop for sale in Pune

When you purchase a shop for sale in Pune, you are also building equity in a property, or rather we should say, an appreciating asset. This allows you to benefit from a financial cushion, as the property becomes more valuable in the future. 

2. A shop for sale in Pune offers you full control 

A shop for sale in Pune allows you to go for renovations and customisations as per your will. You won’t have to worry about approvals, except from the concerned district administration authorities. 

3. Predict your costs 

Even if you are availing a loan to buy a shop for sale in Pune, EMIs are fixed in such cases. This offers you the advantages of predicting your total cost, and not worrying about rising rents. 

4. Potential Rental Income

If you wish, you can rent or lease the property to other businesses in the future, creating a potential source of passive income.

Now let’s take a look at the cons of a shop for sale in Pune

1. You will have to deal with higher initial spends 

A shop for sale in Pune will require a significant upfront investment. This includes a down payment, closing costs, and potential renovations.

2. Relocating might turn out to be a tedious process

One thing you will have to keep in mind is that going for a shop for sale in Pune is a long term commitment. If you wish to relocate in the future, selling the property might turn out to be a complex and time-consuming process.

3. Maintenance will be your responsibility 

As the owner of the shop for sale in Pune, you will have to shoulder the responsibility of the maintenance and repair costs, which could at times turn out to be costly.

4. Limited Location Options

Choosing a shop for sale in Pune may limit your choice of location, as the prices in prime areas are often on the higher side. 

 

Kohinoor Group

If you are looking for a commercial property in Pune, take a look at the commercial projects by Kohinoor Group Pune. To know more about Kohinoor Group Pune, and choose between shop for sale in Pune and shop on rent in Pune.

Related Post - Commercial Office Space Leasing: A Step-by-Step Guide for Businesses

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