In a proper location, for the product and/or service offered, the added overhead is small - as compared to the added revenues. Also, still agreeing with Doug, a good part of a business' value does entail property and/or leases.
On the other hand, as in Arlo's situation, it sounds as if he has primarily worked from home. This does come without its advantages (like going to work OP style). IMO, it is a habit thing. Once a person gets into tht habit, it is hard to avoid the "draw". Overhead is only one of the factors that keep people at home.
Arlo - What are the odds that you would really leave the signage business? I am not talking extended vacation - I mean walk away and never look back. I am only guessing, but the answer is probably never.
Therefore, IMO, you actually need to build two businesses. One that is retail, in a productive location - and another that is specialty or wholesale (preferably things that require a shop & expertise, not a store), operating out of the backyard.
If it did not break the bank - I would build - unless you plan on moving.