Commercial or Residential Real Estate: Which is Best for Your Portfolio?

Winter Park is one of the most luxurious mountain towns in Colorado. Centered around the Winter Park Resort, Winter Park is known for some of the best skiing and snowboarding in the world. Nestled in the Rocky Mountains west of Denver, Winter Park offers incredible terrain for skiing and riding and an all-year adventure in the mountains. With over 3,000 skiable acres, over 170 trails, and 28 different lifts, there’s terrain for every ability level at Winter Park, making it a favorite destination year after year. The mountain town not only offers incredible opportunities to enjoy winter sports, but it’s also a prime destination in summer with hiking, mountain biking, climbing, and other outdoor adventure sports.

Winter Park has incredible opportunities for real estate investment. It’s a year-round vacation destination and a thriving mountain town for locals. There are stunning mountain homes, cozy chalets, luxurious ski-in ski-out properties, and fantastic business opportunities. Investing in Winter Park, CO, real estate can be an incredible and lucrative addition to your real estate portfolio.

If you’ve considered investing, you might wonder which type of property is best for you, commercial or residential. Our guide will cover the differences and benefits of both to help you make a decision.

To get started, let’s review the difference between commercial and residential real estate. Commercial real estate includes any properties that are used explicitly for business purposes. This might consist of retail shops, offices, apartment buildings, and condominium complexes with five or more units, industrial complexes, and anything else that might fall under the umbrella of a business. Daycares, movie theatres, parking lots, and shops are all included under the umbrella of commercial real estate.

Residential real estate is any property that is used solely for living. This can include properties that will be rented out in the short or long term, such as renting out a condominium for vacationers or long-term residents. Residential real estate and commercial real estate sometimes are combined into a multi-use space as well. Residential real estate includes properties like condominiums, single-family homes, and multi-unit complexes with four or fewer units.

There are key differences in the way that commercial and residential real estate perform in the market and the legislature surrounding how they can be leased. We’ll go into the benefits of each next.

Commercial real estate can be highly lucrative for the investor. Commercial properties tend to have higher returns when compared to residential properties, justifying the sometimes higher cost. It can also be easier to find qualified tenants. In residential properties, it can be challenging to find tenants that will keep the property in good condition and pay their rent on time. With a commercial property, however, you are typically leasing to businesses that will be able to maintain the property and ensure a solid cash flow. Commercial properties also tend to have longer leases, which can mean less turnover and, thus, less hands-on time for investors.

Commercial real estate is also a good option because it can easily increase the property's value. The value of commercial real estate is primarily tied to its revenue. Increasing the property's revenue will increase its value and thus create a higher return on your investment. Commercial real estate in Winter Park can be a fantastic investment that can bring stable returns with long lease terms.

Residential real estate can also be a great investment. There are lots of Winter Park properties that fall within the residential real estate category. One of the main benefits of investing in residential real estate is the large buyer and renter pool. Everyone needs somewhere to live, and the homes in Winter Park are in demand. This means that there will often be buyers lined up should you choose to sell your investment, and there will also be plenty of renters. Locals who work in the mountain town need somewhere to live, and there are always plenty of guests and tourists looking for short-term rentals to enjoy their vacation at the Winter Park Resort.

Another great benefit to investing in residential real estate is the low cost of entry. Investing in residential properties is typically more affordable compared to commercial properties. This can be a great way to get started investing or continue to grow your investment portfolio. Residential properties typically have less red tape and legislature governing them, which makes managing and acquiring the property easier.

Residential properties also tend to perform better during an economic crisis. Typically businesses are hit first when there is a downturn in the market, and having residential real estate as an investment can help you weather the storm.

In Winter Park, residential real estate is always a great investment. The mountain is one of the best in the world, and people enjoy vacationing in Colorado all year long, providing a large stream of potential buyers and renters.

When investing in residential or commercial real estate, you should consider which property type will be better for you based on your experience investing. You should also consider the financing options you’ll need. Commercial loans are handled differently than residential loans and may have higher mortgage rates and shorter terms. There also can be differences in the rate and ways that utilities are managed depending on the property type. Make sure you consult with a qualified professional before making a decision either way.

If you’re ready to search for a home or land for sale in Winter Park, Colorado, then you’re going to want to work with an experienced Real Estate Agent. John Sanderson is a luxury real estate agent who specializes in both commercial and residential properties. No matter what investment you choose, John will be there every step of the way to guide you and ensure you’re getting the best deal possible.