Real State is a term used in English speaking countries to refer to the real estate market, both for hiring and buying and selling real estate and other non-residential properties.
What is the Real State?
Real State means real estate, which are by their nature can not be changed in the place they are located. These are attached to the ground, physically or legally, from there its name as real estate, that is to say goods impossible to move.
This concept covers everything that is related to the supply and demand of real estate of any type: residential, commercial, industrial, urban, among others. It also includes processes for rent or sale, promotion, investment, and financing real estate projects. In other words, when we mention Actual State we are talking about all the actions that involve the acquisition of these as:
- The process of buying, selling and renting real estate.
- Real State investment.
- Real estate agencies.
- Real estate agents.
- Construction of new homes.
- Taxes applicable to real estate.
Definitely, it is a term widely used in the area of real estate business. Although, every day is more present in the everyday, especially in the media since the investment in Real State are the most sought after.
The 4 categories of the Real State:
Because one of the meanings of Real State are the real estate, we can divide them into 4 categories:
- Land: this is the basis for any property. Usually, when we talk about land, we are referring to the lots, which can be found with or without development. Example: the vacant lots.
- Residential: this is the personal properties that are not predestined to economic activity. Example: the properties of new building or second hand.
- Commercial: it is non-residential buildings which are intended to produce income. Example: shops, offices, hotels, shopping malls, etc
- Industrial: it is property with large dimensions that are used for productive purposes. Example: industrial buildings, farms, factories, etc
Operation of the Real State:
Sometimes, it may be difficult to understand how it works in the Real State; however, it may be easier to understand if you pay attention to its main components.
- Land: As mentioned above, the land is the basis of all real estate. Then, according to the earth, it sets the real estate market as a whole. This way, you can make a profit during the process of purchase and sale. In the same way, to be the owner of land, you can build houses. Another alternative is that the batch is part of a company and this use for commercial purposes to generate income. Companies of real estate developments can also use the land to build an apartment complex and finance for a project in well. From here you leave the main activities that explain what it is about the Real State:
- The possession and use of land.
- The construction and development of real estate.
- The purchase and sale of properties
- The rental properties.
- Investment in Real State.
- Buyers and sellers: In the real estate trade there are three protagonists: real estate, buyers, and sellers. This market is where these three factors are found to perform some operation in the sector: to buy or to sell. Therefore, in order to understand the functioning of the Real State, must be present to these actors, that is to say, there must be a demand and supply of real estate.
- Agencies or real estate agents: The real estate agencies are those that have as a job to mediate between two or more people in operations that have connection with the sale, lease, exchange or transfer of real estate.
Your goal is to attract owners who seek to sell or rent their properties, and to find their respective customers for them. The purpose is to achieve close to a deal where both of them are satisfied with the conditions set forth. The role of an agent in Real State is to provide management services, counseling, and mediation in real estate transactions.
- Investors: Any person who buys or sells a property, investing in Real State. To perform this action you need to consider many factors and is always looking to make a good investment, whether to live in the home or invest in an asset that yields a rate of return. Because of this, so that the Actual State to work you need of investments that move the market and produce supply and demand in their search for investment opportunities in the real estate sector.
How to invest in Real State?
1. Buy and sell:
Is one of the most common ways to invest in real estate as any purchase of a property is an investment. Therefore, if a person buys a property to live in it, you are putting your capital in a real estate investment. There are two ways to capitalize on that:
- The owner decides to retain the property until their value increases. It's used a lot by this method in periods of economic crisis already that the price plummets in the housing. It is important to know the market and be aware of the fluctuations in the prices.
- The owner can modify the home to increase the value. It is the most used, because you can buy a property that doesn't cost much and fix it to sell it at a higher price.
2. Buy-to-let:
With this alternative, the inverter ensures income each month in a safe manner. However, the returns on the investment will recover more slowly. Some ways of applying this method are the following:
- To rent a property as a residential dwelling. So you can get secure income every month, and seek to receive that amount of money for a certain period of time.
- Holiday rental. This can be an opportunity to receive income, weekly, fortnightly or monthly to tourist destinations. This is not a fixed, but depends on a certain time of the year.
- Rent student. You can rent a home student for the period of time studying in the city. This allows you to have a fixed income during the cycle elective and in the high season change for a holiday rental, earning an income variable.
3. Invest without buying:
You can allocate your capital to different financial instruments that have real estate as protagonists. For example:
- Real estate investment funds: it is a collective investment in which money is directed to the investment in real estate. The profitability is generated by means of a rental, the revaluation of assets, or in publicly-traded companies and working in the real estate sector.
- Crowdfunding real estate: these are companies that present a project on a crowdfunding platform and real estate investors put their money to finance it and get you a return.
- Stocks of companies of Real State: is the purchase of shares of construction of houses or companies that form part of the real estate market. The price of the shares rises and falls along with the property market and, hence, depends on the profitability is obtained.