The word estate means land or property, no doubt about that. But, what is the meaning of the phrase real estate? No, this real derived from the Latin root res, which means physical things. Many says, the word real from the phrase real estate, came from Latin word rex, which means royal. Now the doubts are clear we assume as the word royal refers to the property that is owned by the Kings.
So, phrase that we frequently hear but don’t know the meaning i.e. real estate means any kind of property, land, home etc. along with all the resources buried underneath or floating above the specific ground. And real estate market refers to the market where real estate properties are traded.
Real estate has 4 specific categories.
1. Residential real estate
This is the most common type of real estate. This not only includes residential homes under construction, but also includes sales of ready-made homes. From single family homes, to high value homes, multi generation homes, duplexes, quadplexes, double decker, triple decker, townhouse, vacation home and every other kind of homes build for residential purpose falls under this category.
2. Commercial real estate
Commercial real estates are those which are for commercial purpose. Well, rental apartments are also called commercial real estate though they are used as residents. Shopping centers, malls, office space, urban and semi urban office accommodation, educational institutions, hospital buildings, hotels and every other commercial properties and constructions fall in this category.
3. Industrial real estate
Obviously this category is for industrial and manufacturing purpose. All types of industrial and factory buildings, warehouse, manufacturing facility, distribution unit, storage building, are categorized as industrial real estate. Besides, research facilities and production facilities are also classified as industrial real estate.
4. Land real estate
Lands are the most basic real estate properties. Any vacant land, farms, ranches fall to this category.
Real estate industry
Real estate industry constitutes of various components. Most basic components are construction firms, brokerage firms and agents.
Construction firms or industries are one of the most basic components of real estate market. Construction industry is also an important part of the economy for any developing or developed nation. Construction of newer buildings or infrastructures is important in numerous ways. It increases the beauty of a country, urbanizes more and more areas, creates work opportunity for numerous unemployed peoples, creates investment and startup opportunities.
On the other hand, construction of residential homes is a critical economic indicator for any country. More people building new residential homes mean more people are gaining economic stability. That is why governments of different nations put much emphasis on construction sector. World’s biggest economy America’s GDP’s 6.25% (numbers from 2017) is contribution of construction sector, which shows how exclusive the sector is.
Brokerage companies and agents
Real estate agents are self-employed professionals who provide assistance to the buyers and sellers of real estate property. They are called brokers too in many countries. Agent for seller and agent for buyer work differently.
Sellers’ agents assist in selling a real estate property and do everything needed to sell it. Sellers’ agents provide buyers list or find buyers from their personal contacts. A seller’s agent can help the seller in getting the highest possible price for his land through bargaining, convincing the buyer about the property and other necessary steps.
On the other hand, the buyer’s agents try to reduce the price as much as possible. They are well familiar with the local market and work on finding suitable and budget friendly property for their buyers. Both types of agents charge significant amount of money after the transaction is completed.
Nowadays, many people opt for brokerage companies rather than individual agents. Brokerage companies cost significantly lesser than individual agents.
Into the world of real estate
One can jump into the real estate market for 2 reasons, either for trade and profit, or for permanent settlement. Everyone who buys or sells real estate properties join this market and becomes a part. It is easy to buy or sell a land or other type of property, but bringing the highest possible profit from that is not easy.
It is important to gain some knowledge on the sector before engaging, especially for those who invest here to earn some good amount of return. Investment in real estate properties can be very tricky. One should follow some tips and strategies and also take professional advices. Overall, real estate market is not something complex like stock market, which many find difficult to understand.