What Exactly Is Real Estate?

Real estate investment is basically buying a piece of property for the sole purpose of using it for investments, earning money or for living expenses. It involves making an arrangement to acquire a piece of property either for personal use or for letting others use it for their personal purposes. In layman’s terms, a real estate investment is all about buying, possessing, renting or leasing a piece of real estate. Real estate is basically land consisting of the structures and property on it, and its accompanying natural resources like water, crops or other minerals; immovable real property of this kind; an ownership stake in such an item of property, whether buildings or houses in general. Investment in real estate can also involve purchasing shares in a corporation, investing in the stock market or any financial instrument, acquiring property through financing options, etc.

The purchase of real estate involves two distinct kinds of transactions: acquisition and disposition. Acquiring a piece of real property includes both the process of acquisition and the disposal of it; in the case of dwellings, this involves the construction of the dwelling, furnishing it with appliances and fixtures, and finally, converting it into an abode suitable for living. On the other hand, when dealing with real estate, the process of disposition involves the freeing of the said real property from obligations connected with the acquisition or financing of it. For instance, when building a home, the homeowners may sell or exchange their houses in order to be free of mortgage payments or dues.

The sale of real estate can either be domestic or international. In domestic transactions, it usually involves the transfer of possession of one’s personal property to another party who is willing to assume the said obligations. Examples include the exchange of real property between spouses who are getting divorced. On the other hand, international real estate transactions involve the transfer of possession of one’s immovable property or personal property between countries and jurisdictions.