Residential and Commercial Properties: 5 Most Commonly Asked Questions

The property market is a dynamic industry that can be both exciting and challenging for buyers, sellers and investors alike. Whether you're considering purchasing your dream home or exploring investment opportunities in commercial properties, you likely have some initial questions. 

In this blog post, we'll address five of the most commonly asked questions in the world of residential and commercial property.

1. What is the Difference Between Residential and Commercial Properties?

Residential and commercial properties differ primarily in their intended use.

Residential Properties:

These properties are designed for individuals and families to live in.

Examples include single-family homes, apartments and townhouses.

Residential properties are registered in planning law for housing and are often located in residential neighbourhoods.

Commercial Properties:

These properties are intended for business or profit-orientated activities.

Examples include office buildings, retail spaces, warehouses, industrial facilities and hotels.

Commercial properties are registered for commercial use and are typically found in industrial estates or business parks.

2. Can Commercial Properties Be Used for Residential Purposes?

In most cases, commercial properties cannot be used for residential purposes without obtaining the necessary permits and planning changes. Planning permissions are established by local governments to ensure that properties are used in a manner consistent with their intended use and lending terms. Attempting to convert a commercial property into a residential one without proper approvals can lead to legal issues and fines.

However, there are instances where mixed-use developments combine both residential and commercial spaces within the same building or complex. These developments are designed to create a blend of living and business opportunities, providing convenience for residents.

3. Are Commercial Properties Cheaper Than Residential Properties?

The cost of commercial properties can vary significantly depending on factors such as location, size, condition, and the type of commercial property. In general, commercial properties tend to be more expensive on a per-square-foot basis than residential properties. This is because commercial properties are typically larger and require specialized features and infrastructure to accommodate business operations.

Residential properties, on the other hand, are often more affordable for individual buyers and investors. However, the cost of residential properties can also vary greatly based on factors like the housing market's demand and supply dynamics in a particular area.

4. What Is Classed as Commercial Property?

Commercial properties encompass a wide range of property types. Here are some common examples of what is considered commercial property:

• Office buildings: These are used for businesses, professional services, and administrative work.

• Retail spaces: Locations where businesses sell products or services to consumers.

• Industrial facilities: Warehouses, factories, and manufacturing plants fall into this category.

• Hospitality: Hotels, B&Bs, and resorts offer accommodation to travellers.

• Multiple-unit housing: Apartments with multiple units can also be classified as commercial properties.

It's important to note that the classification of a property as commercial can depend on local planning permission and the property's intended use.

5. Can I Run a Business from Home with a Residential Mortgage?

Running a business from your home while holding a residential mortgage is possible in some cases, but it depends on several factors. Here are some key considerations:

• Planning permission: Check and apply for planning permission to ensure that running a business from your home is permitted. Some properties have restrictions on the type and scale of businesses that can operate from the property.

• Business type: The nature of your business matters. A small home office for freelance work is typically more acceptable than running a commercial storefront from your residence.

• Tax implications: Running a business from home can have tax implications, so consult with a tax professional to understand any tax changes or deductions that may apply.

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