The Real Estate Sector

Real estate involves an investment in land and the immovable property located on it as well as the resources contained therein. The property on the land could be used either for residential or commercial purposes and the resources contained therein may include water, minerals and crops. People will therefore invest in real estate for different reasons.

Services required by people in real estate sector

There are so many professional groups within the real estate sector including quantity surveyors, real estate agents, architects and engineers among others. These groups require such services as financial planning and analysis, accounting for architects and construction firms, legal assistance, strategic management services, office administration and procurement that can be provided by other professionals in the market.

Read more about accounting for architects

Why do people buy land?

Land is one of the most risk averse investments. It also has great potential with respect to return om investment since it appreciates continuously. Unlike other investments that can either be profitable or accrue losses, land is the only investment that guarantees an increase in value over time.

Once land has been bought, there is no need to worry about management since the land can be left bare. This eliminates the need to worry about acquiring and managing tenants, dealing with agencies, management companies and other stakeholders in the market. This makes it ideal for people who do not have so much time to spend on investment activities or those who do not have the skills and patience to deal with stakeholders in the investment world.

Land can also be put into different uses depending on its location and the owner's goals. It can be leased out for different purposes, used for construction of commercial or residential property, used for agricultural purposes, used as recreational parks for a fee and so on. These uses are both short and long term and the owner has the freedom to change the intended use as his or her goals change over time.

Given that land is an exhaustible resource, it is prudent to purchase some. Land can be passed down from one generation to another securing the future of your children and grandchildren. This is especially important in areas with rapid population growth. Besides, land can be used as a store of value.

Why do people buy land to build property?

Buying land to build property is a great speculative investment where the property is sold at a higher price than the cost of construction upon completion. In addition, it can also be a long term investment where residential or commercial property is put up and leased out.

If you are contemplating an investment in real estate or in land, you should carry out in depth research on the areas of interest in order to ensure that you invest in areas or countries with the highest return on investment. This is important given the capital intensive nature or the real estate sector. If you are not sure about anything, consult the appropriate agencies or professionals for sound advice. Besides, you are advised to avoid rush decisions and investments especially when debuting in the sector.