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Types of Real Estate Investment

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Real estate (also Realty) is property consisting of land, the buildings on it, its natural resources, as well as air rights. The term "real estate" also refers to the business of real estate and the profession of buying, selling, or renting land, buildings or housing. 


The real estate industry is very large and lucrative, covering areas like buying and selling or leasing real estate, managing residential, commercial, and industrial properties, as well as the provision of other real estate related services.


The importance of the real estate industry to the economy of a nation cannot be overlooked. It provides shelter while also creating jobs, eradicating poverty, ensuring social security and promoting sustainable economic development. 


There are three broad categories of real estate namely,

Residential Real Estate: These are properties used for residential purposes. Examples include undeveloped lands, flats, multi-story detached buildings, and terrace houses.

Commercial Real Estate: These are properties that are used for commercial purposes. They are leased as work-spaces and not as living space. Examples of properties in this category include shopping centers, offices buildings, buildings used for medical purposes, gas stations, hotels, and warehouses.


Industrial Real Estate: Examples in this category are manufacturing buildings, farms, and mines.



Real Estate Investing


Real Estate Investment involves engaging in buying and selling or leasing of real estate. For most people, investing in real estate is just about owning a home, but there are other highly profitable real estates investments. Individuals can buy terrace houses, duplexes single-family homes, which can be renovated and rented out.

Large real estate property investments are usually attractive to individuals with high net-worth and institutions, such as life insurance companies, real estate investment trusts (REIT) and pension funds. Common examples of investment properties that can be used to generate ongoing rental income are residential units, event centers, and office buildings. Investors can also expect to generate capital gains as the value of a property increase over time.



How To Invest In Real Estate


One way to invest in real estate is buying or building a home to live in. A home is truly an asset. Home-ownership provides substantial benefits to families including privacy, the pride of ownership, freedom of control, financial stability, strong credit base, and much more. Most average earners are able to afford a home from accumulated savings. There is also the option of taking a mortgage to enable you to own a home.

Another way to invest in real estate as a beginner is acquiring a land. Individuals can choose to build a home on the land, farm on it, lease it or resell it at a higher price. With the growth in population experienced in Nigeria, acquiring a land is almost always a wise investment.


Another way to invest in real estate is to purchase or construct housing units and office buildings for lease. With the housing deficit in Nigeria placed at 17 million, the real estate sector is definitely a good place to invest in. Also, the constant migration of people from the rural villages to urban cities has increased the need for more residential units and office space in the cities.


Investing in real estate is a great way to go, especially if you have the capital. But if you don't have enough money, you can still invest in real estate by investing in real estate investment trusts (REIT), home or estate construction companies, or real estate mutual funds.


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