What does real estate mean?

Real estate is land and anything that is permanently fixed to it, like buildings or houses. It can cover everything from a small plot to large commercial skyscrapers. Real estate as seen in land and buildings is different from stocks and bonds which are not physical assets but investments.

Types of real estate:

• Residential Real Estate: These are properties where people live such as single family homes, apartments, condos. Be it purchasing a house for living purposes or just renting an apartment, the latter instance concerns residential property.

• Commercial Real Estate: These include office buildings, shopping malls, restaurants and other places used for business purposes.

• Industrial real estate may be utilized for manufacturing, warehousing and distributing goods; in factories, warehouses and distribution centers.

Key concepts in real estate industry:

• Property: In real terms this means ownership rights over asset meaning land or building.

• Lease: You can use a rental property by signing a lease agreement with the owner for certain period during which you shall be required to pay rent.

• Mortgage: A mortgage is simply a loan taken out to purchase real property; where the property itself serves as collateral i.e., the lender can take possession of the property if the borrower fails to make his monthly payments on time.

• Equity: What you actually own of your property is equity i.e., what remains after subtracting that amount still owed on your mortgage from its market value (property’s worth).

• Real Estate Agents/Broker: Those licensed professionals arrange selling/buying/renting deals with clients helping them navigate through complicated procedures ensuring all legalities are met; they also work within a brokerage firm.