Do you know real estate? If not, you should read this guide to understanding real estate industry basics how the industry works.
Before to start the discussion about property’s management we should need to know about real estate. Real estate is a property, land or building which present physically. As the name indicated that property is real and present physically. Property management departments provide services to real estate owners. There are different ways to make money through Real Estate.
The basic or main idea on which persons work is that they purchase a property at low prices and sell after a few months or years on very high prices and make their profits from them. This strategy can also be used to purchase properties during times of low prices and then sell them later when prices have risen.
Nowadays mostly individuals also make money in real estate by purchasing properties and after to build renting them out to people or business offices for long-term benefits. This strategy involves having a certain amount of property management skills to be successful since you or your agent will need to vet potential renters, receive their rent payments, and then clean up and fix things after they have vacated the property.
Types of Real Estate
There are also several types of real estates which are;
So, for you to understand well there explanation may be a helpful guide.
- Land typically refers to undeveloped property and vacant land. The land comprises all naturally occurring resources.
- The residential real estate consists of housing for individuals, families, or groups of people. This is the most common type of estate in this type one can buy or take on a rent your assets for his use.
- Commercial refers to a land or a building that used to carry business. Commercial land refers to shopping malls, banks, Cafeterias, medical centres, and office buildings.
- Industrial real estate refers to an industrial business or large scale working areas. Industrial estate refers to Factories, Mechanical production, and Research and development centers.
The Real Estate industry most common and spreading a lot nowadays. There are many ways to be involved in this business; you can become a real estate investor, a real estate agent, broker, wholesaler, you can manage real estate, or even lend money to someone else who buys and sells real estate. The Real Estate business can be divided into several areas which also need to explain shortly.
- Sales and marketing
- Property management
- Professional services
Real estate developers are persons who buy lands at low prices and develop/build them to make a building. After this, they sell this property with high-profit margins. Developers earn a profit by adding value to the land (creating buildings or improvements) and taking the risk of financing a project.
- Sales & Marketing
Sales and marketing firms or persons are work with Developers to sell their properties with high profits and take commissions for this. These firms earn a commission for creating all marketing material and using their sales agents to sell the inventory of completed units. They provide intermediary services. In the United States of America, these intermediary is referred to as Real estate broker (A Realtor).
A real estate brokerage is a firm that employs a team of real state agents who help facilitate a transaction between the buyers and sellers of property. Their job is to satisfy both sellers and buyers with the best possible terms.
- Property Management
Property management is a service provides by agents who help Real estate owners in finding customers for renting out their properties. Their job to showing units, Fix rents and fixing deficiencies. They charge a fee, typically a percentage of the rent, to property owners.
- Real Estate Lending
In real estate business lending plays an important role. Most buyers do not make the full amount, so they take money from lenders. Lenders may be a Bank official, Credit unions or private lenders.
- Professional Services
There are a variety of real estate professionals who work in the industry and help make it function. The most common examples are accountants, Real estate expert lawyers, interior designers, stagers, general contractors, construction workers, and tradespeople.
From them, we need to discuss Property management with details. So, let’s start to discuss this. Property management, as a name, indicates that it’s a management of the property. In this agents manage the property, equipment, and physical assets and make the property more eye-catching. Property management involves all the processes and systems required to control, maintain, responsibility, and utilization of property.
For example, an owner of a single family may engage the services of a property management company. The company will then advertise the rental property, handle tenant inquiries, screen applicants, and select suitable candidates into the property and collect rental income. The company will then coordinate any maintenance issues, supply the owners with financial statements and any relevant information regarding the property etc. So, basically, this is the working format of Property management service providers.
In the United States, Government issues a License for property management companies. If the owner manages his own property then owner does not need to hire any licensed real estate agent. But owners who do not live near his rental property, they need to manage his property. So, they hire a property management company for this purpose. Here, if we talk about a career in real estate then there are a lot of jobs. So, this is valuable and concise information regarding real estate business.