Popular wisdom would have you believe it’s better to own than rent.
But does that rule still apply when deciding whether to lease or buy your medical office space?
The pros and cons of leasing vs. buying are similar for medical entrepreneurs as they are for the general population, with a few important distinctions:
Just like with residential leasing, leasing your office space offers more flexibility and a lower upfront investment than buying.
But buying office space may provide more significant benefits down the road.
Buying allows you to…
Control rising costs and more accurately predict your monthly operations expenditures…
Complete expansion and construction projects as your practice grows…
Establish your practice in a location where no rental properties are available, and…
Take advantage of certain tax breaks and write-off’s not available when renting property.
But buying is not automatically better than leasing. While net income generated from real estate is not subject to certain taxes, it’s also no longer possible to ‘hide’ taxable income under the umbrella of a real estate purchase.
Consult an experienced CPA before deciding if leasing or buying is right for your practice, and remember that there is no one-size-fits all solution to finding the perfect property for your growing practice.
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