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4 Types of Real Estate

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4 types of real estate

Real estate is land, buildings, and immovable property, such as crops. It also includes the air above and the ground beneath. The word ‘real’ refers to ‘physical’ or ‘tangible’ property.

There are many kinds of real estate – shops, cottages, airstrips, mansions, etc. But all of them fall into four major categories of real estate. This post will walk you through the four main types of real estate and give you a few examples of each type.

1. Residential

The most common example of residential real estate is a single-family house. This also includes buildings cut up into apartments, such as duplexes, triple deckers, and quadplexes. Vacation and generational houses are residential as well.
There are also condominiums, which are divided into units that can be sold independently. Typically, condominiums have shared common areas that are jointly owned.

Townhouses are also considered residential. This is a row of houses that share walls. They’re a form of terraced houses, which are sometimes called row houses.

2. Commercial

Commercial real estate is property used for business purposes. This includes malls, educational buildings, offices, shops, hotels, and medical buildings. Apartment complexes are considered commercial since they’re used to generate income.
Commercial real estate companies own property and lease it to companies who want to use the space. A lot of small businesses can’t afford to buy a building, so they start out renting. Buying property and renting it out to businesses is a great way to make money.

3. Industrial

Industrial real estate refers to properties tailored to specific goals for businesses. Usually, this is where products are created and shipped from. A common example is manufacturing buildings. These facilities house specialized equipment and produce materials and goods.

Warehouses and distribution buildings are also examples of industrial real estate. These buildings typically have one story and significant space. Since these locations dispatch product, they have loading docks and parking for large trucks. They can also be connected to the rail system.

Research and development (R & D) buildings also fall under the industrial category. These facilities are highly specialized and hold various kinds of equipment. This is where products, such as electronics, are developed and tested.

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4. Land

This refers to large tracts of land, such as farmland and ranches. They can also be vacant lands like a forested area or a plot of ground. The most coveted land are the tracts near the borders of fast-growing cities. In some regions, significant amounts of land are purchased for hunting purposes.

Land that is in transition or being developed also falls into this type of real estate. Some investors purchase land with plans to cut it up into lots and sell it away. They’ll get approved for road construction, utilities, and infrastructure. Essentially they’re creating a neighborhood.

Whenever buying or selling land, one must consider the weather patterns and quality of the land. Other important factors are zoning laws and environmental regulations. These variables affect the price and can make or break deals.

Keep learning

There’s a lot to learn in real estate but keep at it. Knowledge empowers us to make the right decisions in our lives and in our careers. If you’re considering a real estate career, knowing the types of real estate can help you.

Sometimes a real estate niche is perfect for you, but you don’t realize it because you haven’t heard of it. By knowing your options, you can narrow in on your niche.

You can stick common practices like renting out apartments or flipping houses. But you can also try something more unique, like investing in industrial real estate.

What kind of real estate would you invest in?

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