Importance of Real Estate

Importance of Real Estate

Real estate refers to land, as well as any physical property or improvements affixed to the land, including houses, buildings, landscaping, fencing, wells, etc.

Ways to Invest in Real Estate:There are a variety of ways to invest in real estate, ranging from real estate investment trusts (REITs) in buying a rental property or multi-family housing. Vacant land and residential lots, houses, outbuildings, decks, trees sewers and fixtures within the boundaries of the property are examples of real estate. Furniture, cars, paintings, jewelry and boats are examples of personal property rather than real estate.REITs offer the opportunity to participate directly in the ownership or financing of real estate projects. REITs are tradable interest in a pool of real estate related assets. REITs own and often operate, income-producing real estates such as office buildings, apartments, shopping centers, warehouses and hotels. Many REITs specialize in one property type, such as offices, apartments or regional shopping malls. Most investors buy REITs for their rich dividends. Each real estate sector is affected by different economic cycles which then govern the market. Larger, diversified, or geographically dispersed REITs are less exposed to regional weakness and major economic cycles. On the other hand, smaller, more specialized REITs often provide the greatest growth potential in a niche market. Types of Real Estate:There are several types of real estate properties, each with a unique purpose and utility. The main categories are:

1. Land
2. Residential
3. Commercial
4. Industrial

• Land

Land is the baseline for all types of real property. Land typically refers to undeveloped property and vacant land. Developers acquire land and combine it with other properties called an assembly and rezone it so they can increase the density and increase the value of the property.

• Residential

Residential real estate consists of housing for individuals, families, or groups of people. This is the most common type of estate and is the asset class that most people are familiar with. Within residential, there are single-family homes, apartments, condominiums, townhouses, and other types of living arrangements.

• Commercial

Commercial property refers to land and buildings that are used by businesses to carry out their operations. Examples include shopping malls, individual stores, office buildings, parking lots, medical centers, and hotels.

• Industrial

Industrial real estate refers to land and buildings that are used by industrial businesses for activities such as factories, mechanical productions, research and development, construction, transportation, logistics, and warehousing.Examples of Real Property:There are some specific examples of different types of real property.

• Single-family dwelling: Any home designed for only one family
• Multi-family dwelling: Any group of homes designed for more than one family
• Attached: Any unit that is connected to another
• Apartment: An individual unit in a multi-unit building. The boundaries of the apartment are generally defined by a perimeter of locked or lockable doors. Often seen in multi-story apartment buildings.
• Multi-family house: Often seen in multi-story detached buildings, where each floor is a separate apartment or unit.
• Condominium (Condo): A building with individual units owned by individual people.
• Detached house: A free-standing building not connecting to anything else
• Portable house: Houses that can be moved on a flatbed truck
• Mobile home: A vehicle on wheels that has a permanent residence attached to it.
• Hut: A dwelling typically made of raw materials such as bamboo, mud, and clay.

The importance of location in real estate purchase always seems to be overestimated. The reason is that the location is what translates into profitability for the investment. Location, primarily, creates the desire for purchase. So it is important that the buyers end up choosing the right location and that makes the real estate more valuable but suitability and liking towards the property plays an important role. Whichever be the country of residence, a buyer makes a decision based on the home, an ideal place for them to live for a long time, that they are going to purchase and not the area that it is located in. A lifelong investment for a Home will definitely be influenced by a myriad of factors which shape a family’s future.

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