A property condition assessment provides your buyer the opportunity to evaluate the physical condition of a building in relation to the expected income.
Similar to comparing the CAP rate between investment opportunities, a property condition assessment identifies where the building’s systems are in their expected life cycles and how the expected expenditures will impact your client’s return-on-investment.
For example, a building built 20 years ago should be up for a new roof system, heating and cooling system and possibly other needed investments for the building to remain in serviceable condition.
The cost of maintaining a building over the life of your loan will one way or another impact your cash flow, so why not take the prudent path and incorporate these costs into your purchase decision.
Property condition assessments can provide your clients the information needed to make sound business decisions.