Real estate is a term used to define a piece of land along with everything that forms a part of that land, like a building. Investment in real estate involves a lot of risk. But it is one of the easiest ways of multiplying your income. With property touching the skies and showing no signs of going down, if your luck clicks, you may end up making more money than you could have ever dreamt of in your wildest dreams.
Real estate investment includes the following things:
a) Property Investment and associate risk or Speculation: Real estate can generate substantial rental income. The income from the rental property may also come from the resale of the property. For this speculation is a necessity. The speculation related to a real estate sale and resale, is all about predicting the rise or fall in market values. Simply put, speculation is a calculated assumption. It may be right or wrong. When it is right, the investor/ owner would end up with significant profits. However faulty assumptions may lead to huge losses which could include loss of the concerned property. Therefore investment in real estate is a risky prospect, and is dependant upon market conditions.
b) Broker and his function: A broker is one of the most important individuals involved in a property deal. During most transactions, the broker acts as the mediator. For his/her services, the broker earns a commission. In many deals the broker earns a commission from the investor as well as the seller.
c) Real Estate Investment Trustee: Most countries have a real estate investment trustee. This is a body or corporation that looks into all the matters affairs relating to real estate transactions or property estate transactions. This body has the power to eliminate corporate income tax. For this, the real estate investment trust is required to distribute 90% of their income to the investors. The income of RIET or Real Estate Investment Trustee is usually taxable. In countries like India, the Real Estate Investment Trustee or REIT has not yet been set up.
Investors around the world are often eager to invest in property estates or rental property. This is because such investments have the potential of being highly profitable. At present real estate investment is a booming industry. Though there are high stakes and risks involved, real estate investment is a very good way of making money.
Investing Real Estate
