Real Estate – Major Categories

Real estate is property consisting of the structures and land on it, and its accompanying natural resources like water, plants or minerals; immovable property consisting of the same land and buildings on it. immovable real estate can include personal property like a house or a building, which may be used for business purposes. An immovable real estate usually cannot be converted into personal property. A lien is placed on the property by a legal instrument called a mortgage. The title to immovable passes under the control of the lender and passes on to the purchaser at the time of sale.

Real Estate

The major parts of real estate are: land, which include buildings and permanent fixtures such as houses, garages, sheds, office buildings, barns, and pools; structures such as fences and garages; personal property including furniture, antiques, art, records, musical instruments, appliances, household furnishings, equipment, automobiles, and vacations; and fixtures and utilities such as heating, drainage, water and sewer lines. Immovable real estate comprises the whole of the real estate owned by a person, irrespective of the ownership of other real estate properties. A lien is placed on immovables for security against a loan. Lien on immovables varies in nature from simple lien to full foreclosure. Real estate investments include buying, selling, renting and leasing of properties.

Real estate investments include purchasing a single-family residence, apartment building, condominium, townhouse, mobile home, modular home, office buildings, warehousing, manufacturing facilities, office buildings, warehouses, trailers, buildings with permanently attached furnaces, iron plant, processing and assembly plants, power generating plants, railroads, highways, parks and recreational lands. Besides these, other types of real estate investments include agricultural land, block and reed land, manufactured homes, estate holdings, mining areas, commercial and industrial lands, private lands used for grazing, forestry, spring lands, sports and business developments, undeveloped lands, pergolas, arbors, fences, sandstone and rock walls. The total value of all types of real estate owned is greater than six hundred billion U.S. dollars.

In the past few years, residential and commercial property has emerged as the two fastest growing segments in the U.S. property management market. There has been an increase in the number of foreclosures and repossessions over the past few years which are largely affecting the property management industry. The increasing number of foreclosures has created a challenging environment for the property management professionals leading to a crisis in the property management industry.

The crisis in the real estate industry can be broadly classified into two broad categories, one is the permanent loss category, which includes foreclosures and repossessions, and the other is the temporary loss category, which includes leasehold improvements, disposition of personal property, leasehold capital improvements and disposition of vacant land. The permanent loss category includes a wide variety of issues, including acquisition by an individual or company for investment purposes, disposition of property to a third party and sale of real estate. The temporary loss category includes examples such as leasehold improvements, disposition of residential and commercial real estate property. The above mentioned examples are just some of the common issues faced by most real estate professionals.

For all its complexities and issues, the real estate business still provides a lot of scope for profit making opportunities. Many real estate investors have made major profits from buying and selling residential and commercial properties. One of the most profitable investment opportunities in real estate today is real property owned purely for residential purposes, the second most lucrative category is that of commercial real estate owned purely for commercial purposes.