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What Is Real Estate?

Real estate refers to land and any structures attached to it that have a measurable

value. For example, a garage attached to a house would be considered part of the

real estate, while a movable picnic table in the backyard would not. Real property

can be used for commercial or residential purposes. It is the foundation of the

American economy, and real estate investors have made fortunes by buying and

selling land and buildings.

The real estate market includes new construction and resale homes, commercial

property and industrial property. The most familiar form of real estate is residential,

which encompasses single-family homes, condominiums, co-ops, townhouses,

duplexes, triple-deckers, quadplexes and high-value vacation houses. Commercial

real estate includes shopping centers and strip malls, medical and educational

buildings, hotels and offices. Apartment buildings are usually considered

commercial, even though they’re used for residences, because they generate

income for their owners. Industrial real estate involves manufacturing facilities,

warehouses and distribution centers.


Investors can make large profits in the real estate market by purchasing properties

that are positioned to appreciate. This is known as “house flipping” and requires

careful research to identify locations that have the potential to appreciate. In

addition, homeowners can also add to the value of their property by making

improvements. For example, adding a swimming pool or a fence may increase the

resale value of a home. Also read


While real estate is an important investment, it is also a highly competitive industry.

Whether working as a broker or a homeowner, real estate professionals must be

able to market their services and build a network of contacts. They must understand

the local market and be able to negotiate prices and terms. They also must be able

to locate suitable financing and meet regulatory requirements.


In the business world, real estate plays a critical role in a company’s ability to

operate effectively and compete successfully. Yet corporate real estate often falls

short of its potential because it is often viewed as a second-order function that

focuses on discrete projects and transactions rather than on the broader strategic

issues that are at the heart of effective business strategy.


For example, a company’s decision to relocate to a new city might impact its bottom

line, while an expansion into a foreign country could have global implications. Real

estate experts can help companies develop a strategy to maximize the value of their

real estate investments. They can advise on a range of issues, including location and

layout, facility management, capital structure and the development of real estate as

a strategic asset. These five maxims, based on the experiences of leading real

estate organizations, can serve as a guide for companies looking to improve their

performance in this critical area.