Real estate is an immensely lucrative venture if handled informatively but for a newbie, you have to learn your way around the wobbles of it.
Certain questions must be asked before venturing into Real estate. Please follow closely.
- What is Real Estate?
Real estate is defined as land and any permanent structure, like a home, or improvements attached to the land, whether natural or man-made.
Real estate is a form of real property. It differs from personal property, which is not permanently attached to the land, such as vehicles, boats, jewelry, and others.
- What Are Types of Real Estate?
Residential real estate: It refers to any property used for residential purposes. Examples include single-family homes, condos, duplexes, townhouses, and multifamily residences.
Commercial real estate: This is for any property used exclusively for business purposes, such as apartments, complexes, gas stations, grocery stores, hospitals, hotels, offices, parking facilities, restaurants, shopping centers, stores, and theaters.
Industrial real estate: It refers to a property used for manufacturing, production, distribution, storage, and for research and development.
Land: Includes undeveloped property, vacant land, and agricultural lands such as farms, orchards, ranches, and timberland.
- The Economics of Real Estate
Real estate is a critical driver of economic growth in Nigeria and the world at large. The Real Estate sector dominates about (6.85%) of the Nigerian economy.
Investors and analysts keep a close eye on housing statistics because the numbers can provide a general sense of economic directions within a twinkle of an eye. It can give clues about how the economy is developing geometrically.
- How to Invest in Real Estate
Some common ways to invest in real estate include homeownership, land banking, investment or rental properties, locking up shops, and house flipping. Also, a type of real estate investor is a real estate wholesaler who contracts a home with a seller, then finds an interested party to buy it. Real estate wholesalers generally find and contract distressed properties but don’t do any renovations or additions.
The earnings from investment in real estate are garnered from revenue from rent or leases, and appreciation of the real estate’s value. Real estate is dramatically affected by its location and factors such as employment rates, the local economy, crime rates, transportation facilities, schools or Institutions, municipal services, and property taxes imposed on properties in a particular locality.
- When Will I Start Seeing Returns on my Investment?
Real estate investing isn’t like trading stocks or buying mutual funds. It’s neither like buying a container load of home theaters or a truck full of foreign doors from China or Singapore. Depending on the type of real estate investment vehicle you are operating, you are probably going to wait for a little while before your returns start flowing in. However, If you invest in a great deal, the returns are massive and second to none.
Conclusion
Real estate has its pros and cons, notwithstanding it is a highly viable investment that will yield fruitful returns when done appropriately and with uttermost guidance.
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