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Types of real estates investments

Real estate is property that involves land and improvements, including buildings, roads, structures, utility systems, among many others. It is one of the most popular asset classes, and while many know this, not everyone knows the different real estate investments there are. A person who invests in real estate, that is, the buying and selling of property, is called a real estate investor. Each investment type has its unique benefit and demerits, so you should study them well before you begin to invest in real estate. If you are interested in acquiring and developing properties, you might get a better knowledge of the complexities involved by understanding the different categories. These categories are;

· Land

This is the baseline for all types of real estate property. It refers to undeveloped and vacant property—that is, land. People acquire land and combine with other properties so they can increase the value of the property.

· Residential

Properties such as houses, apartment buildings, townhouses, and vacation houses where you are paid to live for a fixed amount of time are called residential structures. In North Seattle, you will find many luxury homes for sale and for lease. The length of stay of the occupant to whom the house is leased or rented must be specified in the lease or rental agreement—most times, residential leases are on a yearly basis.

· Commercial

Office buildings and skyscrapers are types of buildings categorized under commercial properties. You can lease out a small building with individual offices to companies and businesses, who will pay rent for using the property. Unlike the residential real estate category, commercial real estate involves multi-year leases, which results in greater stability for cash flow and protection for the building owner. The disadvantage with commercial real estate is that rates cannot be increased as long as the property is still locked into older agreements. This is a disadvantage because the markets fluctuate, and rental rates can increase substantially over a short time period.

· Industrial

Everything from industrial warehouses, storage units, car washes, or special purposes for real estate that generate sales who use the facilities is classified under industrial real estate. They often have massive fees and revenue streams. An example is adding coin-operated vacuum cleaners at a car wash to increase returns for the owner.

· Retail

Properties under real estate are shopping malls, supermarkets, and other retail storefronts. Sometimes, you, as the owner of the property, can receive some percentage of the sales generated by the tenant. This is besides the rent that they have to pay to keep the property in an excellent condition.

· Mixed-use

These are the properties that combine any of the above categories into one project. One advantage is that they generate significant income for the owner. It is an attractive venture for an individual with massive assets, as they can diversify, an important quality for controlling risks.

Real estate sales can be hectic, so you must have the best hands on deck to ensure you get the best deal possible.

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