When you invest in commercial real estate, you need to understand that there is a vast difference between commercial real estate and residential. Not only is the market different, but so are the laws. Due diligence in commercial real estate is different than that in the residential market. You still want to make sure you get an inspection of the property prior to the settlement as well as a survey of the property. You also have to make sure that you get any easements included in the sale if they are needed.

Most people think of easements as those that burden the property, such as those for utilities and sewer. With commercial property, there are often easements that benefit the property. In some cases, in order to get to a property people have to drive their vehicles over other property owned by other people. In such a case, the person who purchases the commercial real estate will want to make sure that they get the easements needed for parking or entering and exiting. These can be included in the deed or in an easement agreement.

The only way to see if you need easements is to get a survey of your property depicting not just the property but any easements that pertain to the property. The title insurance commitment should also reflect a legal description of the easements. The title company needs to search not only the commercial real estate property that you are purchasing but also any other property in which you are receiving an easement. The reason for having this property searched includes the following points:

You need to know that the person who signs the easement agreement or deed is legally entitled to convey interest in the property. You need to know that there are no burden on the easement property that would prevent you from using it. You need to know that the taxes on the easement property are current. It would be unfortunate to purchase commercial real estate property that is dependent on easements and discover that the property is in a tax sale. A person who purchases the property could insist that you pay money to use their property; they may even erect a fence to prevent you from using the land.

A home inspection performed by a knowledgeable inspector can be one of the best pre-sale investments you make on a real estate transaction. The inspector’s work benefits both the buyer and the seller, sometimes in similar ways, but often the inspection takes care of opposite sides of the same coin. If the seller orders the inspection, the cost of the process can be added to the asking price of the house. If the buyer demands the inspection, it is usually up to him to pay for the costs, so either way, the seller is not out the cost of the inspection.

The information gathered during a home inspection can be invaluable to the buyer. The location of shut off valves, pump switches, heating and cooling filters, and breaker panels are all information that will be found in a comprehensive home inspection. This information will make it easy for the buyer to locate such necessities quickly in an emergency. Sometimes valves and switches are located in unusual places, particularly in older houses. The inspection process identifies and maps such important items.

The buyer’s home inspection limits surprises that can crop up during the initial period in a new home. Maybe there are shaky areas in some of the home systems that could easily fail early in the new ownership. Making use of a home buyer’s inspection will let you know what the tentative areas are so that you can be prepared for the cost or surprise that may hit you. By knowing exactly where the problems lie, the buyer won’t need to worry about ‘what if’s’. The buyer will know precisely where unexpected system failures are likely to show up.

By completing the buyer’s inspection prior to making the finalizing the Offer to Purchase, the buyer will know which items in include as contingencies or special clauses in the sale agreement. The offer can focus on precisely the items that need to be covered. For example, if the roof is fine, as shown by the buyer’s inspection, there will be no need to mention that in the sales agreement.

The home inspection done by the seller is also highly beneficial. By completing a seller’s inspection, the seller knows precisely which repairs need to be made before listing the property for sale. There will not be the necessity of repairing or replacing a roof if the inspection shows it to be in good shape. If the chimney needs to be cleaned, that can be accomplished before placing the home on the market.