What Is Real Estate?

For millions of Americans, real estate represents one of the largest investments and

single most valuable assets they will ever own. It is also a leading economic

indicator, driving jobs in home improvement, development, lending, insurance and

business.

In simple terms, real estate is land and anything that is permanently affixed to it.

Unlike personal property, which includes everything from furniture to farm

equipment, real estate can be passed down through inheritance and is considered

an integral part of the family’s net worth. Real estate is classified as either

residential, commercial or industrial.

Residential real estate is land used for dwellings such as homes, apartment

buildings and duplexes. It can also include multifamily housing units, like condos and

co-ops. Commercial real estate is land used for office space, retail stores and

warehouses. Industrial real estate is land used for manufacturing, processing and

storage such as power plants and factories.

All of the above types of land are considered real estate and can be purchased, sold

or leased for use. In some cases, a government agency may hold title to a piece of

land and it is then called public real estate. This type of real estate is not subject to

public auction and usually has very few restrictions on how it can be used.

A real estate agent is a licensed professional who arranges real estate transactions

for buyers and sellers. They can be found in offices, brokerage firms and online and

are often specialized in certain areas such as residential, commercial or industrial

real estate. A good real estate agent will know the local market, laws and common

For example, a realtor who specializes in residential real estate will have an intimate

knowledge of local neighborhoods, schools and transportation facilities. They will be

able to advise their clients on the most suitable property for them and their families.

A knowledgeable agent will be able to explain the ins and outs of home ownership

including taxes, insurance and homeowner association fees.

In addition, a good real estate agent will understand the complexities of a mortgage

and be able to provide advice on how to qualify for one. They will also be able to

guide their clients through the process of buying or selling a home, from start to

finish.

Anyone interested in investing in or owning real estate will benefit from learning as

much as they can about the industry. It is essential to take stock of a person’s

financial standing before getting involved, since a mortgage will require a significant

investment of money and time. In order to be approved for a mortgage, a potential

borrower will need to have a credit report that indicates an acceptable debt-toincome

ratio. It is also important to have a steady source of income and the ability to

pay mortgage bills. This will help ensure that a person can keep up with payments

on their new home or investment property.