Types of Real Estate

The Different Types Of Real Estate – Discover The Best To Invest

Research shows that real estate is the prime and most aged asset classes. However, what many people do not know is that there are several types of properties. Well, it is important to note that each class of realty investment contains its own benefits and limitations; including unique twists in the money transfer system, lending protocols as well as its standards for what is thought of as reasonable or appropriate.

Therefore, it is not unusual to find someone who has built a fortune by adapting to specialize in a certain real estate sector. Well, there are generally three types of real estate which are:

1.    Vacant Land
2.    Residential Properties
3.    Commercial Properties

Vacant Land

Many people think that real estate investment refers to buildings only (i.e. Commercial and residential). However, land or vacant land is also a type of real estate, which actually requires a huge investment amount. This type of investment is popular and mainly used in the rural area. Generally, the property price and size are quite large, with consistent commissions.

Land investment can also be broken down into several different categories. These are:

•    Brownfields land: These are pieces of lands that were previously used for commercial or industrial purposes, but currently available re-use. These types of properties are generally environmentally impaired.

•    Infill Land: This kind of land is located in a city, which was previously developed, but currently vacant.

•    Greenfield Land: This refers to undeveloped lands like ranch, farm or pasture.

However, before investing in this type of real estate, it is important to understand specific buying requirements as well as your motivation.

NOTE: land properties can be both commercial and residential depending on what you want or your investment plans.

Residential Properties

This type of assets is by far the most popular with both experienced and newbie agents. This is not a surprise because ever since men started living in houses and not caves; houses have become one of the most essential or basics requirements to man.

Residential properties can also be broken down into several different categories.

•    Single-Family Home: These are types of homes built in a single unit, with no shared wall.  Most often, they come with a garage that is attached to the building.

•    Condominium (Condos): Condos are quite popular especially top people living in urban centers. This is a type of real estate where a person owns a single unit within a larger building or community. It is common to find condos on Seven Mile Beach in Grand Cayman.

•    Town Houses: Townhouses are a hybrid between condos and single-family homes. They often come with multiple floors, with one or two shared walls.

•    Cooperatives (Co-op): This type of residential investment is slightly different from a condo. However, with condos, you own the space within your unit. With Co-op, everyone owns the building because they have a shared title.

•    Multi-Family Homes: These are the least common types of residential investment. They are generally homes that have been converted into two or more units.

When you have decided to invest in this real estate niche, it is important to identify what you want, what is available as well as your expectations.

Commercial Properties

Commercial real estate can be either land based or building based investment. Its valuation requires a more sophisticated technique while taking into account the income potential of the property, cash flow, historical revenues and much more.

Commercial real estate can be classified into different categories including:

•    Offices: Offices properties are classified into two types (suburban or urban). They are great property investment but require an enormous financial backing.

•    Industrial: This type of building operates a variety of tenants, and they are mostly located outside of urban areas.

•    Rentals: These types of property house the retailers and rental homes. If you are looking to invest in commercial real estate, then this is a great way.

There are many categories of commercial real estate and some fall under the special purpose category. These are properties that are owned by commercial real estate investors, but they actually do not fall under any sector mentioned.