Real estate is the exchange of a parcel of land with the rights to occupy and use it. Real estate is any property consisting of the buildings and land on it, and its accompanying natural resources including water, minerals or plants; or an interest in it, buildings, housing or real estate in general. In the United States, real estate comprises almost eighty percent of total residential sales, and almost half of total commercial sales. It is important to note that real estate does not include property such as vacant land, manufactured homes, agricultural land, undeveloped land, and structures like barns, granary buildings, storage sheds, office buildings, hotels, motels, military barracks, military housing, government offices, schools, hospitals, and trade unions. These are all included in the category of personal property.
While real estate investing can be lucrative, there are also several pitfalls involved in the process. One of the most common and serious pitfalls for investors is the investment’s tendency to take too much of a dip in value in a relatively short period of time. Investors are at risk of purchasing properties that are not worth what they paid for, especially when these investments were made in the early stages of the market. Another disadvantage of investing in real estate involves the high cost of maintaining the property. Maintenance costs can quickly add up, particularly if there are significant changes in the location of the property or the amount of traffic that the property sees during different times of the year.
Residential Real Estate Investing deals with land that is used exclusively for residential purposes, such as apartments, houses, townhouses, condominiums and other types of residential real estate. A typical residential piece of property is one that is built on a piece of land that is owned by one party. Unlike commercial real estate, residential properties do not have to pass through a series of financial and legal inspections before being released for resale.
Industrial Real Estate Investing deals with land that is used for building structures. This includes both residential and commercial structures, including warehouses, garages, storage units, manufacturing plants and other types of facilities. An industrial plot of land is generally purchased with the intent to develop it for various uses. Although development of the plot of land may require the removal of existing buildings and other features on the land, it does not have to do so. There are real estate brokerage firms that are designed specifically to assist investors in purchasing parcels of land with the intent of developing them into productive business properties.
Rental Property Investing deals with properties that are actually used for rental purposes. This type of real estate investing involves taking a piece of property and renting it out on a regular basis. The different types of rental properties that can be handled by a property management company include vacation homes, apartment complexes, furnished rentals and other types of temporary property management arrangements. Property managers deal with all of the legal issues that come along with renting from a landlord. A property manager can also help to find tenants and can help to oversee the property so that it remains safe and is able to maintain its value over time.
Many different types of Real Estate transactions can be handled through a real estate brokerage firm. These firms are well-known for their ability to find buyers and sellers that are looking for a property that meets their criteria. They also have the ability to purchase properties for resale purposes as well. Whether the investor is looking to make money on a commercial real estate market or to buy rental property for business purposes, the broker can help find the perfect property that meets their investment goals.