Investing in real estate can be a good way to make a profit, but requires much thought and research. Here are three of the main types of real estate.
- Commercial Real Estate
Commercial real estate involves property that is used to house businesses or otherwise make a profit. Commercial real estate may include hotels, business parks, industrial complexes and retail venues. This can also include multi-family housing complexes with five or more units that are rented out to tenants. Various types of commercial real estate investments include:
- Wholesaling, where you sell your property contract to another real estate investor
- Development, where you tear down a building and construct a new building for a business
- Owner-occupied, where your business occupies at least 51% of the building space that you own
It is wise to seek a professional to help with acquiring commercial real estate, as you will need to know about local laws and ordinances.
- Land Real Estate
Land real estate overlaps with but expands on commercial real estate to include:
- Farmland real estate New Jersey, which refers to the land, machinery and livestock of a farm
- Property that has not been developed or prepared for any kind of construction
Although land is a scarce resource, investing in land real estate can be risky.
- Residential Real Estate
Residential real estate refers to property that is used for residential purposes, such as single-family homes, duplexes, condos, townhouses and multi-family complexes with fewer than five units. Like commercial real estate, it is possible for residential real estate to generate a source of income but still remain in the residential category. An example would be a homeowner renting out a second home to an individual or family.
Before you invest in one of these types of real estate, do some research and get to know the surrounding business environment.